On Cores
Meditations on the semiconductor and IP industries
By Warren Savage, CEO, IPextreme

Monday Aug. 10, 2009

Repeat after me: IP is a product business...

Well... That's a nice analogy, but let's get real. If the final baking (aka verification) and recipe (feature set) needs to be done with the help of the customer, that's more design services than IP. I have no issues with design service companies at all, except for they masquerade as IP companies. There is a real role for these companies in today's semiconductor industry because there is a need for the glue that holds together the real IP in the system. Use the same code once, that's "IP". Use it twice, that's IP.

You need only look at the most successful IP companies to see a product orientation. ARM, MIPS, Synopsys' DesignWare are all examples of a hardline product-orientation towards their business that allows those companies to scale to significant profitability. Its difficult (impossible?) for "IP" companies based on the service model to compete with those on the product model because of the need to rely on low cost labor.

Imagine there was a car company out there that was producing partially designed cars. Their selling proposition would be that it's impossible to design a car that can be used by more than one customer. So, they leave some details for the purchaser to specify, and they will quickly create a custom vehicle for you that has never been road tested before under real world road conditions. I doubt there'd be a line forming for these cars.

But seriously, we in the industry should be concerned about our stewardship of the industry and be careful not to regress to the missteps of the last decade when dozens of services companies added "IP" to their sign boards only to leave behind frustrated customers and a black mark on the industry that persists still today. If we follow in the footsteps of our successful brethren, we won't go too far wrong.

Posted by Warren Savage on Monday Aug. 10, 2009 | Add a Comment

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About the Author

Warren Savage, President and CEO of IPextreme, is a well-known and published authority in the field of semiconductor intellectual property. He has a long history of pushing the envelope of design methodology from his work in fault tolerant computing at Tandem Computers in the 1980's and driving reliable design metholologies into commercial practice at Synopsys for its DesignWare IP product in the 1990s. Much of his thinking became embodied in the seminal book on IP reuse, the Reuse Methodology Manual. Warren is taking his vision to the next level with his latest company, IPextreme, which is focused on enabling broad commercialization of IP captive in large semiconductor companies.