Essential Electronic Design Automation (EDA)

EDA Business Models

Nora:

Do the business models for the EDA vendors vary as much?

Frank:

Well, they vary, but not as much. Developing the next leading-edge product while supporting your current products is a high-risk venture. Many large and small companies compete, but at any given time only one of them has the best-in-class product. Small companies are more likely to succeed since they can focus their resources on one product. (There is no cushion—they must sell the new-generation product or go out of business.) Moreover, vendors do not want to lose the revenue from existing products. In addition, customers are often slow to migrate and want continued support and upgrades. A large vendor has more support staff for existing products. That may ...