The buzz about showing and paying for value in EDA has been building over the past few years. People have complained about the high cost of tools and EDA vendors have complained about not getting enough value from the technology that can then be re-invested in the next generation tools. The same complaints can be heard from the foundries regarding their wafer pricing

Companies have tried royalty-based models before in the past (e.g., $/wafer or even profit sharing). But it hasn't been sticky. Is the industry ready for a new model?  I think sharing in the upside and potential downside of a particular design from inception to volume is fair. But it also would mean that EDA companies and foundries would have to participate even earlier (and later) in the product lifecycle - from design spec/marketing through product introduction.

That's a pretty big change that goes beyond just the business model. But maybe at 32nm and below, where designs cost upwards of $75M to bring to market, this type of collaboration and risk/reward model is required and desired

Anonymous