The IP Story: From Shaky Start to Bright Future

by Phil Dworsky and John Chilton

Over the last few years, the third-party intellectual property (IP) market has had all the ups and downs of a typical startup venture. Some early IP providers looked only at potential profits and promised more than they could deliver. Engineers eager to embrace the concept of purchasing ready-made IP blocks were often frustrated when the technology that was supposed to speed the design cycle ended up slowing things down. Many soon discovered that the promise of IP was overstated when it couldn't be readily integrated, verified and reused. This instability has substantially changed the market for third-party silicon IP. While the overall size of this business has increased (25 percent in 2001, according to Gartner Dataquest), there has been a shakeout of weaker players, leaving only a few key IP vendors who are successful in each market segment.