April 24 - 28, 2006 by Jack Horgan
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Introduction

The Printed Circuit Board Market is an important albeit a small part of the overall EDA market. The table below shows the size of the PCB and MCM market for the last two years.
$M
2005
2004
Change
PCB+MCM 343 341 0.6%
Total 4,575 4,437 3.1%

Table PCB+MCM Revenue
Source EDA Consortium


The combined PCB and MCM revenue accounts for about 7.5% of total EDA revenue. This market is flat. The market is dominated by Mentor Graphics, Cadence and Zuken. I had an opportunity to interview representative of two of these firms.



Mentor Graphics

I spoke with David Weins Director of Business Development before Mentor's April 10th announcement of XtremeAR, its new autorouting product for large PCB boards.

There are two different methodologies that have been used over time for PCB design. There is the automated approach which you would think everybody would want to do. Then there is the manual approach. What we continue to see is that there are certain designs that kind of defy the automation that we would like to see everybody using. We sell tools for both interactive and automatic use. We are not trying to sell one over another. While automation is a beautiful thing in that it really shortens up design cycle time and minimizes resources, there are still some designs that can't be done with automatic routing. These include PDAs, cell phones and also PC mother boards, particularly for laptops where form factors are critical. Boards where autorouting has done a good job are monster sized boards, things like network switch cards, servers, mainframes, and big backplanes.

Would you expand on the types of products that have these complex form factors?
It's purely a function of visualization of the problem. Both automatic and manual tools are highly driven by constraints. The problem is that when you look at a board, designers can visualize where the best paths are for a parallel bus, where the components would go next to each other that most optimize. That's the sort of thing when you are in a very tight space. Human skill has an edge over the machine. The human can do things that the machine can not do as efficiently as possible. In these cases designers tend to choose the interactive approach as opposed to the automatic approach. I would point out that it is not a hard and fast rule, one way or the other. Most people are doing a combination of the two. Typically on a very dense design, they will lay it out or rather place it by hand so all of the components are in place. Then they will automate fan out and do a little bit of automated routing just to see how things are going to look. Then they come back and either manually clean it up or decide that they want to rip up a whole bunch of stuff and reroute it manually. It is kind of an iterative approach between automatic and manual tools. The reason we distinguish is because the automated layout side those boards are the ones where you tend to be able to push the button and get fairly close to 100% without a whole lot of manual cleanup.

Xtreme technology is the technology in play as it is with XtremePCB. The same patented technology is underneath both products. It allows simultaneous processing by multiple users on the same database. This is the unique thing within the PCB layout space that we have, namely the ability to automatically let multiple users work on the same database without having to go through a manual partition of the design and manually gluing back together at the end of the process. This solution can work across the network either locally or wide area, single continent or multiple continents. The server looks at what is happening with each of the users, receives their edits back, performs some rule checks to determine if they are still valid, makes modifications if necessary and then sends them back to each of the clients in real time. It is a very dynamic process to sit there and watch multiple people working concurrently and see the edits of each of their peers showing up next to them. That's the underlying technology.

We launched XtremePCB in late 2004 for this predominantly manual mode where multiple layout designers can work on a design and get it done quicker. In that case we saw cycle times being reduced by 40% to 70%, fairly significant considering the densities and the times taken to get some of these boards done. The types of things users would most likely to do by hand include component placement, the interactive routing aspect of it and other tasks like documentation, manufacturing prep. In some cases engineers are virtually looking over the shoulders of the layout designer, potentially even making edits to insure optimized performance on a circuit.

Over the past year how many systems of XtremePCB have been sold?
The number of systems sold is in the dozens at this point. These are the sorts of tools that fit into large enterprises but we have also seen service bureaus because it can cut down their design time. This is a key element of competition.

Some customers have experienced 40% to 70% optimization of performance. We are seeing better in some cases but we haven't characterized all the data we have been getting.

The new product is XtremeAR?
XtremeAR takes the same methodology that is used for XtremePCB and applies it to distributed autorouting, people working off of a central network with a central server involved. In this case it is a single user driving multiple machines. It is utilizing the same patented technology with a limit of 15 CPUs. We are experiencing up to this point roughly 10X reduction in execution time. This is huge compared to the incremental improvement that we can make in tools over the year and get improvement of the order of 10% to 15%. Here you have an immediate 10X reduction in cycle time just be leveraging existing hardware. This is with 15 CPUs.

The reason why it doesn't achieve 100% optimization is because of that patented technology where the autorouter looks at the design and partitions up these nets and sends to each of these processors. The routes get done by those processors, are received back, design rule checks are done, modifications are done if necessary and then redistributed to the autorouter. That kind of pulsing process is what reduces the optimal performance from 100%. It is not bad by any means but it is not network traffic or anything like that, although that can impact it. It is the router itself crunching away on circuits.

Where are people doing autorouting?
Largely digital, high speed constrained nets where they can do that sort of push button autorouter. The other place is where they typically want to do designs by hand. Here's the crossover in methodology where they may say on that motherboard for a laptop, I fully intend to route this thing by hand because of the density but what I would like to do is to figure out roughly how many layers do I think I am going to need for the circuit. Because it is a high volume application for the consumer market, cost is everything. Going from 2 layers to 4 layers to 6 layers impacts cost significantly. They can use XtremeAR to autoroute, automatically to evaluate overnight. They kick off a run with 2 layers, one with 4 layers and one with 6 layers and run them overnight. In the morning they come back and see that the 2 layer run got only to 50%. They would say that I can't route that any better manually, so I have to throw that out. The 4 layer run got to 80%. That's looking pretty good. The 6 layer run got to 100%. In fact the autorouter did it all by itself. I am betting that if I cut it back to 4 layers, I can save myself some cost and hopefully get it done. It comes back to virtually prototyping of the layout to get the most efficient design.

What is the value proposition?
Cutting cycle times down from days to hours, really improving designer productivity overall, letting them do multiple evaluations so that they can get a higher quality product. But it is also a resource management tool because where XtremePCB allows teams and managers to efficiently utilize, to have as many people as possible on a critical design and offloading so that people can pulse in and out of a project. With this tool you can have a designer using all the unused CPUs. For example, people working in the UK getting things done but the CPUs in the US are unused because folks are still sleeping. They can flip it over when the opposite is true. Or they can do it within a single location when everybody goes home in the evening and the jobs are automatically kicked off. It is really leveraging existing hardware in an organization. Because hardware can be cheap relative to the end product you are trying to make, we foresee some folks deciding to implement CPU farms and really leverage this technology.

We have examples of cutting run times from 5 hours to 1 hour and from 2 days to 18 hours. This is clearly a case where a layout designer had to sit and wait for a couple of days for a route. Now they can punch a button and come back the next day and see what the results are and make better choices and move on from there without having to wait too long before getting their results back.

I would note that there are classes of boards where this technology is not applicable. First of all if an autorouter can get a board done in one hour, applying multiple CPUs to get it done in 10 minutes probably doesn't have as much value. The guys who are routing multiple days tend to see the most value in this thing. The other cases are boards that may route in 10 minutes. If you apply this technology because it is distributing across the network, it may take 20 minutes to route. Not a good application for this technology. We are looking for the monster boards to apply this technology.

Any customer experience with this tool?
We have had the product out in controlled release for a few months so we could get some customers hammering on it and determining the value of it. In this case the customer applied it to a large optical switch card of 36 layers. The board is roughly 0.5mx0.4m, a major board with a huge number of nets and high speed content. When they routed this board with an autorouter, it took 78 days to crank through. If they had an expected cycle time of two weeks, they have only one iteration to run on that router. Then they have to run with the results. They don't have time to take a second pass to see if he can do any better with the results. That may be just end up pushing the cycle time out. With XtremeAR they leveraged all 15 CPUs and cranked it down to 18 hours. So they could do multiple iterations to determine optimized performance with optimal numbers of layers as well.

What is the packaging and pricing of XtremeAR?
The beauty of the method we have used to license XtremeAR is that designers with XtremePCB licenses and that have an autorouter at their disposal, can also use XtremeAR at no extra cost. They can choose which method they want to use. The example I talked about of a laptop designer can now do some prototype runs overnight to determine optimal layout before they start actually laying out by hand during the day it is very possible. Use XtremeAR overnight and then XtremePCB in the day to really optimize the utilization of resources in that environment.

What are you charging people who do not have XtremePCB?
We charge $50K for server and about $20K for each of the clients. That's why you are not going to get everybody to go for 15 licenses automatically. They are going to be determining roughly what they need. That's why we have done a lot of work to determine the optimal configuration. We don't want them buying up 15 clients when they really only need 3 unless they wanted to run three jobs simultaneously. It is really a function of determining the type of server that is out there, the typical circuit they are running and then recommending the appropriate number if clients based upon that data.

Are these perpetual or time based licenses?
These are perpetual floating license but time based licenses are also available.

What percentage of boards are you targeting?
The beauty of this thing is that you can apply it to interactive type designs or automatic type designs. It's not the type of board. It is more a question of industry and the impact on time that these industries are faced with. Certainly consumer market is the highest priority followed by telecommunication which is a close cousin of consumer. If you look at those two markets combined and maybe mix in computers, you are around 70% of the PCB market. It depends on how you slice and dice this thing. There are industries but becoming fewer and fewer where time is not of the essence. But even the military is being crunched by constrained performance to the extent that we are seeing some military taking a look at this technology.

Is there any other vendor offering anything that overlaps either XtremePCB or XtremeAR?
No! It is a patented technology. We will protect it at some level. It is unique. We have another product called TeamPCB which is a simpler methodology that allows people to partition designs manually, distribute them, and bring them back together. That's the closest thing we have that anybody out there. The folks at Cadence have some tools. They are talking about automating a little bit to compete with that solution. But nothing on the order of XtremePCB or XtremeAR where you can have multiple users simultaneously working on the same design.

What is Mentor's marketshare in the PCB space?
It depends upon the region but overall we have 40% share. The market has been growing 1% to 2% a year. Number 2 is Cadence with their Allegro product line and then Zuken. Between the three companies, we form an oligopoly that owns about 70% to 80% of the market.

Between the three firms, is one company stronger in one geographical area or in one end user industry?
Tough question! Where the company started has an impact. Cadence and Mentor are strong in the US. Zuken started in Japan and has enjoyed good marketshare there. It is somewhat diminishing just because of globalization of industries. They have not been able to keep a hold on that unique space. Cadence and Mentor have been making inroads into that space. At the same time Zuken has been making some inroads in Europe. In Europe we have over 50% of the market. That's the market where we have the largest share.

The overall market is growing only 1% or 2% per year?
Yes. If it pops over 5% compound, we are happy for it. At the same time, it is a question of how you measure that market. We are seeing crossover in technology between IC and PCB that will fuzz up that measurement in the future. That's where we are seeing a lot of growth at the moment.

Is it that the number of users is flat or that the prices are dropping?
It's a mix. Certainly we are seeing the industry shifting a bit. US jobs are definitely going over to China. We are seeing that happen. The prices of designs are transitioning as well.

If you look at the market Dataquest has the traditional pyramid model where you have at the bottom about 70% of the seats in what they call the late adopter market, low end type designers. Up to 30% lies in the mid range and 10% at the top. But the revenue is spread equally between all three. What that points to is an industry where at the bottom you have high volume low cost per seat, at the high end you have low volume and high dollar per seat. Because of typical industry consolidation, you see some shift in that. But I can't say by and large that all of the independents are getting bought out and everybody is filling up on that top part of the pyramid. There are still plenty of smaller designers out there where the barrier to entering the design market is low enough that individuals typically spinning out from larger corporations can form their own businesses and be fairly competitive.

Any other observations on the future direction of PCB market?
It is continuing to evolve. I don't see PCB dying out any time soon. It's an evolution as additional circuitry hits the silicon side that makes for more complexity in designs, more functionality in designs. That always leaves the PCB as the interconnect mechanism.

There is even some pulsing backward from that silicon consolidation. We have seen some folks that have rejected the SoC concept due to cost and quality and are coming back to partitioning portions of the circuit onto multiple CPUs again. This again puts the PCB back as the interconnect medium and makes performance a critical function for the PCB. It's driving up requirements on the PCB side. That's where you get things like SERDES technology to really drive up performance on the PCB so that the PCB is not the slow dog in the overall circuit.



Zuken

I had a chance to talk with Wolfgang Heinrichs, GM of Business Development for Zuken Europe and USA

Would you provide an overview of Zuken?
We have a long history with PCB and MCM software (established 1976). In recent times we have been enhancing our portfolio in the direction of signal integrity solution, EMC solution and PLM for engineering, a product lifecycle management solution. This is because there is significant need around the PCB world on the one hand to manage all the high speed aspects coming along with the number of pins on the IC and on the board where the frequencies are increasing like hell and manage the lifecycle of the PCB.

Would you provide and quantitative data about Zuken?
The latest revenue number is roughly $156 million for the year. We have a bit more than 1,000 employees. We have 3,100 plus customers with 32,000 licenses in the field.

How is this distributed geographically?
The number for the US and Europe combined is roughly 30%. I don't have the split between the US and Europe.

How do you position Zuken against the two other players in the PCB arena, namely Mentor and Cadence?
Interesting question! From a revenue point of view I guess Mentor is number 1, Zuken number 2 and Cadence number 3. From a technology point of view I and Zuken believe we are more or less number 1 in this market due to our unique technologies that we have implemented over the last year which really allows us to have a fully integrated constrained PCB design from spec through the whole solution. I guess that this is unique so far.

Are there any end user applications where Zuken is particularly strong, say analog or high frequency?
It is in the area of high frequency and dealing with signal integrity issues. We have unique products. For example we have an EMC solution which no other vendor provides. This gives very quick EMC and signal integrity analysis to designers.

Would you provide an overview of Zuken's product offerings: Cadstar, Visula, CR-5000?
CADSTAR is our desktop PCB engineering solution for small customers to the lower end of mid-sized customers. Visula is our long standing solution which we started with. CR is our brand new technology which is our major business. Every customer is moving from Visula to CR-5000. That's our latest technology.

Would you describe CR-5000?
CR-5000 covers the front-end portion of the process which includes schematic design, scenario design for high speed PCB design, PCB verification post simulation, design for manufacturing and manufacturing integration.

Are these products all based upon a single integrated data base with a consistent user interface?
They are all based upon a single data base. It can handle small to large enterprise customers from this single environment.

Does this support multiple users working concurrently on the same design?
Absolutely!

How does that work?
In CR-5000 Zuken currently supports the ability to develop designs into a number of physical entities that more than one user can work on at the same time to layout that design within a constraint driven flow so that you can simulate different portions. At the end you can reconstitute that design to bring it back together as one single entity and then run post layout simulation and move onto post processing and manufacturing.

Can multiple users view and work on the same portion simultaneously?
Not currently?

Would you comment on CR-5000 Lightning, an optional module?
It is directly integrated into CR-5000 flow. It allows front end scenario generation. It allows you a prototyping environment for signal integrity and simulation tool suites. It is built with system designer tools and flow.

Lightning used to be the former HotStage solution, now integrated into CR-5000 so that we have a fully integrated design solution with unified constraints. The difference from the old HotSatge is that we have totally changed its architecture. It is now a fully integrated environment. It is no longer interfaced. It is no longer an isolated tool as it had been before. It has a single simulation engine. Everything is driven from the same database. That is the unique thing we have implemented over the last one and half to two years.

Inside the Lighting tool itself there are unique pieces of routing function; things such as trunking, interactive lengthening that allow you to easily design and modify things like busses. These types of things are manipulated as single entities.

Would you expand on trunking?
We have introduced what we call intelligent objects that have more knowledge than just the things that make it up. So we know a differential pair is a differential pair. Once you have placed and routed a differential pair, it remains a differential pair. When you move one, the other comes with it. It is very easy to modify them interactively. In the router itself things like changing layers become very easy. We have implemented various numbers of objects that you can use.

Would you expand on you EMC solution?
EMC design is our 3D offering for PCB design. It enables generation of things like flexible PCBs in a three dimensional view. This directly integrates things like the router so that you can flatten a three dimensional view of a PBC, route in two dimensions with automatic routing tools in Lightning and then read it back into the end design.

Does Zuken offer anything in the cable harness arena?
Our current solution is Cabling Designer. The idea behind Zuken is that we try to cover the electrical part as well as the mechanical part related to any kind of cabling. On the one hand you need to be able to drive the electronic portion, the electronic side, meaning being able to handle cabling schematics. On the other hand it is important that you will be able to drive this down to any kind of integration with a three dimensional environment like a CATIA environment. This is driving our whole process. Digging down a bit more into the detail of how this is going to work, we have various areas within cabling environment. Schematic is one area, topology is another verification is still another.

For the circuit design you need to have the logic connection design. From there we are driving the so called topology planning. From there we are going into a wire harness design. From there we are interfacing into the 3D world and CATIA where we have a close partnership and with other companies who are able to handle the three dimensional aspects of a cabling environment. In the 3D environment we are going to route the cable down to its final form, final room for enclosure. From there we are getting back information like real dimensions so that we can handle this data within the schematic and then we can drive the wire harness production design.

There are some areas of verification and analysis. All of this is rule driven. You can monitor all of the results, cross probe between topology, schematic and 3D designs and see the results on the screen.

Would you talk about e-PLM?
Even a single PCB or multiboard PCB has a lifecycle. More and more customers have to handle the lifecycle of a PCB because many things are changing within the PCB. Components are changing constantly due to updates from the manufacturers. The Bill of Material has its own lifecycle depending upon what type of component is the preferred component in the company. This is changing all the time. Specifications are changing all the time. This may have an impact on the schematic or the PCB itself. A PCB is in constant change mode. Customers who have a very high number of products to maintain, the automotive industry for instance, have to maintain hundreds of different products. Each of these products has 100 to 500 different variants. This means that customers will never be able to handle all of this without an integrated lifecycle management approach for the engineering portion. That's what Zuken is concentrating on. Zuken has a truly integrated PLM solution around our CR-5000 architecture which allows our customers to handle all that change around a schematic, around a PCB and around a BOM. The unique thing is that these three areas (schematic, PCB and BOM) are fully under control and fully synchronized with each other. We call this three point comparison. This means it is independent from where the change is coming from. It doesn't matter. The database is able to handle these changes, track these changes and synchronize those changes to ensure before something is going into the product that everything is in synch.

What is the pricing and packaging for CR-5000?
The per seat cost is roughly between $30K and $100K depending upon which modules the customer wants in his PCB design system.

Perpetual or time based license?
We have several license models available for purchasing the product. There are rental models and lease models. It would depend upon the business case for each customer.

How does Zuken sell its products? Direct or indirect?
The CR-5000, e-PLM and 3D electromechanical products go direct through Zuken. The only thing that is distributed is CADSTAR.

What has been going on in the end user world recently? What challenges are there today versus the past?
I strongly believe that that there is nothing that is really new. We are facing the fact that PCB has become a highly constrained activity and is following a real design process rather than a tool focus, which means we are concentrating on how we can build a design architecture which follows a system design process, all the way through. This is not really a single schematic design or PCB design. I think that things like embedded components and HDI technology. This is something that is in the market for 10 years or more. The only thing that is really helping companies like Zuken customers is making sure the EDA design process is becoming a process and this process can be integrated into customers' business supply change.

Do today's higher speeds, more complex packages and so forth have a significant impact on your product direction?
It is an evolutionary thing but we need to make sure that we keep up with this evolution. This is the reason we have developed a fully constrained business flow, a simulation based flow. Many of the things like trunking where our customers need to be able to design quickly within time constraints and make sure these designs work in the end.

We are working into system designs. System design means more than one simple PCB. Customers, I don't want to stress automotive too much, but they are delivering a lot of example that are true for all the other industries to handle the entire system which has multiple PCBs, multiple systems inside. We are more or less forced or motivated to build solutions that will be able to handle multiboard approaches, especially the interconnect between those PCB. We have to provide those designs through more than one PCB. We have to simulate for signal integrity aspects for more than one PCB. We have to involve the interconnect whether it is a flat cable, a FPC, a round cable or whatever else it might be. This drives us immediately into the direction of 3D because as you can imagine a multiboard means interconnection between those boards. It could be a straight forward connection or it cold be a curved connection. If we have to handle those signal integrity aspects we have to make sure that it can be handled in a three dimensional environment. This is our future direction.

Do you see the PCB market in terms of revenue as decreasing, flat or increasing? Is this a function of the number of users or the price that can be demanded by vendors?
The PCB market is flat but it is increasing in other areas than the PCB itself. The market within the signal integrity world is increasing because the problems are now in this area rather than in the standard PCB area. PCB complexity is increasing in terms of process orientation. Front-loaded approaches is the area where the business is increasing rather than the PCB itself. The PCB tools market is flat. In other areas the market is really increasing.

Note: Since the interview with Zuken, they announced the impending acquisition of CIM-Team GmbH, a provider of software solutions for electrical engineering, fluidics, electronics and logical cabling. CIM-Team is headquartered in Ulm, Germany and has subsidiaries and branch offices in Hannover, Switzerland, North and South America, Scandinavia, England and Italy. CIM_Team had revenue of 8M Euros last year. They have a worldwide network of resellers.