Design costs are accelerating as projects move to 65 nm and below which has given rise to the growing use of third party intellectual property blocks. According to IBS, typical chip design costs for a project in 2004 were about $18 million. Just over $1 million of this went towards the licensing and royalties associated with IP blocks used in the design. Today, typical per chip design costs approach $50 million. More than 25% of this is allocated to semiconductor IP costs.
In working with Kilopass non-volatile memory IP customers, we find the strategic benefits of incorporating semiconductor IP are clear but the selection process can be challenging.
Design teams are under pressure to complete complex chip designs in an environment characterized by shrinking market windows and intense unit price pressures. The loaded cost of a two person semiconductor design and verification engineering team can run over $400k a year. This drives companies to focus internal design efforts on elements that leverage the organization’s unique core competencies. Where practical, purchased semiconductor IP blocks help efficiently complete the design.
In converging on the specification and identifying the best semiconductor IP choice there are a number of important factors for semiconductor architects, designers and IP sourcing managers to consider.
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