Silicon IP is 'immature,' execs say

Silicon IP is 'immature,' execs say
By Nicolas Mokhoff, EEdesign
June 3, 2003 (6:21 a.m. EST)
URL: http://www.eetimes.com/story/OEG20030602S0119

ANAHEIM, Calif. — The silicon intellectual property (IP) business is "immature," according to two executives speaking at a Monday (June 2) open forum on the Design Automation Conference exhibit floor.

The business of IP has two components, according to R. Vijayaraghavan, chief executive officer of Comit Systems, a contract engineering company. "One is content, and the other is the delivery of the IP as a component that will suit the methodology of the customer's design flow," he said.

"This is a highly immature business, and IP is hard to implement," said Dan Ganousis, president and chief executive officer of AccelChip, Inc. "IP providers need to understand that the actual IP is only part of their business. Servicing the IP to make it work in the customer's design flow is on top of that."

Ganousis said that it is no good to entice customers to pay $1 million for a piece of IP and then tell them they need to spend another $2 million to match his design flow. "Until we can accept the fact that IP is never going to be perfect, we need to find a way to mitigate the risk that is inherent in the business of IP," said Ganousis.

"From a provider's point of view, he's out there to make money off the IP, but from the customer's perspective, he's looking to find a design solution that will be the most cost-effective and one that can bring out his product out the door faster," said Vijayaraghavan. "We need to work toward predictable transactions. Unless you know what you are going to pay for it, you can't expect the IP to be a real business."

"Working with someone else's IP is hard and it's a risk that designers need to understand," said Ganousis. For those who think that they can handle the risk, it's a no-brainer, but selling IP to a risk-averse novice is "like giving an AK-47 assault rifle to a first-grader. He's liable to shoot himself in the foot before he can do damage to others," according to Ganousis.

The two executives could not suggest what the future of IP will look like, but agreed that the IP business is an immature market, and it will probably be called something else by the time it is commoditized. "Nobody thinks twice about Windows as an IP component in the office software market," said Ganousis. "We live with its imperfections and are satisfied with its functionality as far it goes."

Ganousis said that semiconductor IP needs to be treated in the same manner — as a solution to a design problem, and not for its own intrinsic value.