A picture is worth a 1,000 words so take a look at quarterly EDA revenue as compiled by EDAC:

Ron Wilson of EDN has a good summary of Q3 2009 noting that revenue was down 3.3% compared to Q3 2008.

Typical explanations for a decline in EDA revenue include:

  • Decreasing number of ASIC starts
  • Increasing number of FPGA starts (where tools are free to low-cost)
  • Tight budgets at IC design firms, making do with old tools
  • Increased use of IP instead of designing from scratch
  • Reluctance of IC design companies to use the newest, small geometry nodes, because the older nodes are more cost effective
  • Lingering global recession
  • Business models of EDA companies to license “all you can eat” deals have diluted the value of tools

My personal hope is that device physicists invent a replacement for silicon-based CMOS.

I’ll never forget the transition from NMOS (which was burning up chips) to CMOS, and I’d love to see this new generation of nano-technology design continue to eclipse our limited imaginations. This new device technology will certainly require a new generation of EDA tools, then we’ll see the good-old days return to EDA revenue.