Since then, Viewlogic Systems has emerged as the third in the broad-line supplier triumvirate through acquisitions and internal development, but it currently has a number of pressing problems these days.

Synopsys seems caught between the two camps: They are evolving through recent acquisitions from a niche vendor to more of a broad-line supplier and could even be characterized as an ASIC vendor now. The company so dominates its original niche, logic synthesis, that it has grown into the third largest vendor in the business.

Dataquest figures put the 1995 year-to-year growth for the big four EDA suppliers at: Synopsys, 35.6 percent; Cadence, 28 percent; Mentor, 3.6 percent; and Viewlogic, off 0.12 percent.

Talks with EDA industry leaders, and some of its top watchers, led to some interesting insights into what may be the most dynamic part of the semiconductor business today. Industry analysts sported a variety of opinions on the current state of EDA broad-line suppliers as opposed to niche providers.
“There are no broad-line suppliers, only large multi-point tool suppliers, but this could change,” said Gary Smith, Dataquest principal analyst. “We are moving into a point tool market where suites of tools like RTL virtual prototype and physical verification are needed. Standard industry practice dictates engineering-driven companies being absorbed before IPO within a three-year timetable. Financially-driven companies go IPO before selling out to get more money, while vision-driven companies just keep growing.”

Mr. Smith’s take on Windows broke it into a “cheap seat” market and a mainstream Windows NT arena, where Windows is making a difference in low-end mainstream, with VeriBest and Antares changing the distribution model through VARs like T.E.A.M.

“Service consulting has always been protection with two applications engineers per each sales engineer. Mentor’s insourcing makes it like a giant design house. Outsourcing only works well in the CAD area because CAD guys are so hard to find. Cadence is doing great now, but we’re in a bubble economy and everybody will need help soon.”

“It’s integration and services; broad-line suppliers are the place you go to get interoperability problems solved,” said Rita Glover, president and principal analyst, EDA Today. “They also provide good services. The service industry is consulting versus support. New technology is absorbed by start-ups; people spin out of companies with new ideas to make bigger financial gains and spend more R&D time. Within two years, they are usually acquired by a big company or go public with an IPO. Then, a big company owns the technology after the acquisition and the cycle restarts itself.”

Ms. Glover says the software distribution model is changing because of Windows, which is expected to cost less and is, in her opinion, as good as or better than Unix. “It won’t sell too cheaply,” she said. “The pressure is for Unix tools to come down in price. I think we’ll see a price parity.”

“It has been clearly demonstrated that no single supplier can provide the best tools in every area, or even be significantly competitive in every area,” said Ronald E. Collett, president, Collett International. “The marketplace, where customers purchased from most of their tools from one vendor, has now recast its model into one in which customers can buy different tools from different companies. Acquisitions confirm this. Technology continues to emanate from small start-ups.”

He sees a natural evolution in software distribution, changing as the market becomes more sophisticated, needing less and less support to use EDA technology. “Leading-edge products will still be distributed by their original vendors,” Mr. Collett said before moving to the topic of Windows versus Unix software. “Assuming an underlying platform parity with equivalent hardware, the price of the software should be independent of the platform, with the price based only on performance of the software. This will happen.”

He concluded by calling service and consulting wholly independent from the EDA tools business, completely different although artificially coupled, adding that he thinks the industry will see a lot more of both.

Cadence views itself as by far the biggest broad line supplier. “But most importantly, we’re trying to change the industry and Cadence,” said Joseph Costello, Cadence’s president and CEO. “The EDA label is a broad brush covering many areas. Cadence’s first approach to doing business was in a very focused, healthy niche. We went for a broad-line set of capabilities when customer problems led us to other parts of the design process and the business model of being just an overgrown tool company quit working. So, we grew into a broad-line player.”