Dr. Wally Rhines on global semiconductor industry trends for 2013

April 22, 2013

It is always a pleasure speaking with Dr. Walden (Wally) C. Rhines, chairman and CEO, Mentor Graphics Corp. I met him on the sidelines of the 13th Global Electronics Summit, held at the Chaminade Resort & Spa, Santa Cruz, USA.

Status of global EDA industry

Dr. Wally Rhines.

Dr. Wally Rhines.

First, I asked Dr. Rhines how the EDA industry was doing. Dr. Rhines said: “The global EDA industry has been doing pretty well. The results have been pretty good for 2012. In general, the EDA industry tends to follow the semiconductor R&D by at least 18 months.”

For the record, the electronic design automation (EDA) industry revenue increased 4.6 percent for Q4 2012 to $1,779.1 million, compared to $1,700.1 million in Q4 2011.

Every region, barring Japan, grew in 2012. The Asia Pacific rim grew the fastest – about 12.5 percent. The Americas was the second fastest region in terms of growth at 7.4 percent, and Europe grew at 6.8 percent. However, Japan decreased by 3 percent in 2012.

In 2012, the segments that have grown the fastest within the EDA industry include PCB design and IP, respectively. The front-end CAE (computer aided engineering) group grew faster than the backend CAE. By product category, CAE grew 9.8 percent. The overall growth for license and maintenance was 7 percent. Among the CAE areas, design entry grew 36 percent and emulation 24 percent, respectively.

DFM also grew 28 percent last year. Overall, PCB grew 7.6 percent, while PCB analysis was 25 percent. IP grew 12.6 percent, while the verification IP grew 60 percent. Formal verification and power analysis grew 16 percent each, respectively. “That’s actually a little faster than how semiconductor R&D is growing,” added Dr. Rhines.

Status of global semicon industry
On the fortunes of the global semiconductor industry. Dr. Rhines said: “The global semiconductor industry grew very slowly in 2012. Year 2013 should be better. Revenue was actually consolidated by a lot of consolidations in the wireless industry.”

According to him, smartphones should see further growth. “There are big investments in capacities in the 28nm segment. Folks will likely redesign their products over the next few years,” he said. “A lot of firms are waiting for FinFET to go to 20nm. People who need it for power reduction should benefit.”

“A lot of people are concerned about Japan. We believe that Japan can recover due to the Yen,” he added.

Mentor and embedded
As for Mentor Graphics and embedded software and systems, Dr. Rhines said that embedded took off last year. With the Sourcery CodeBench, it is getting even more popular. Mentor Graphics will play a deeper role in embedded in future. It will be able to connect with a lot of India-based engineers who are already using the Sourcery CodeBench.

Embedded systems and software touches on industrial and other areas of telecom as well, along with analog, power and sensors, as they continue to become more intelligent.

Future areas of growth
Tablets are a growth market, especially, iPads. New products with added communications are evolving. There is also an amazing number of networking chips in design and production.

Analog is yet another area of growth. Hybrid chips, combining MEMS and ASIC is also a growth area. One other key growth area will be the stacked memory die. According to Dr. Rhines, dollar growth will be strong in memory next year.

Automotive is another strong segment. More and more automobiles are becoming mobile servers. Yet another growth area is the Internet of Things, followed by medical electronics. In the latter, implantable devices and hospital equipment are growing. As for skin-based electronics, self-healing devices and touch-sensitive films look to be interesting.

Finally, cybersecurity will go on to be a huge area of growth for semiconductors. Dr. Rhines concluded, “There is huge interest in how chips can be made more secure.”

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  1. Shetty, Veeresh
    April 22, 2013 at 8:10 am

    Thanks a lot and best regards.

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