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Big Players and Smart BuddiesI've seen astonishingly little commentary on this statement in Mentor's recent financial results news release:
Yes, they are closing down their IP division! What does this failure of a major IP player say about the business? It says they played the wrong way. It may not be true in many markets, but for IP, smaller providers like CAST have real advantages over bigger firms like Mentor. Consider a designer trying to get a complex system done. Truth be told, he or she would really rather design everything themselves—or have their smart buddy in the next cubicle do parts—but these days the wiser approach is to design the unique stuff and buy the rest. Which vendor comes closer to that smart buddy, an intimate provider who connects the designer with the actual core developer with just an email or two, or a large provider with layers of AEs and support people and a large corporate structure to feed? Notice, however, I said "smart" buddy. The marketplace has learned that good, reusable IP takes a lot of preparation and packaging, and a larger firm might seem to have more resources for that. The bottom line, though, is that a brillant programmer who also documents their code is ultimately more effective than layers of formal procedure and shelves full of documents, and that's the caliber of people a small firm like CAST is able to attract and retain in all functions. (We've had zero employee turnover for thirteen years.) On the sales side, bigger IP providers also tend to sell to accounts not people, needing substantial orders and volume sales to maintain their overhead and infrastructure. We're lean and bootstrapped and many CAST front-line people still work from home, so we can give great value to small and medium-sized firms and still earn enough to keep on going. We've never strategically pursued them, but we're ironically finding that even large, "tier 1" customers now respect this value model, and are happy to do business with our distributed/virtual organization. That working from home factor ends up being another benefit for CAST customers. When the designer hits a snag they need solid help, immediately. An office culture with regular hours doesn't always meet this need, but an IM-networked team of IP zealots working odd hours all around the world usually does. It's not just CAST that enjoys these benefits over larger providers. PLDA, for example, is doing quite nicely with their focus on PCI Express IP—we wish they weren't!—and IP Extreme has a great example of IP business innovation in their new Core Store. I hear that Mentor is looking for a buyer of their IP portfolio and people, and that they're acting with suitable concern for their customers. That's great and I wish everyone well. We'll meanwhile continue to satisfy our customers as an independent, unencumbered, free-to-innovate smart buddy next door. Let me know what you think. Live Demos at DATEThe Design and Test in Europe show is in Munich this year, March 10 - 14. We have multiple stands within booth E14, the D&R Partners Pavilion, and will be showing two demos. One will help you see the versatile, high-quality image compression possible with our JPEG 2000 Encoder core. The other lets you exercise our new Embedded Internet Subsystem product (see more info to the right). Our friends and partners from Evatronix in Poland and Alma Technologies in Greece will be there, so stop by and see us. Get in touchGive us a call (+1-201-391-8300) or email if you'd like to comment on anything in this issue, or just to learn more about how our line of over 100 cores can work for you. |
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