What changes to expect in Verification IP landscape after Synopsys acquisition of nSys?

Even if nSys acquisition by Synopsys will not have a major impact on Synopsys’ balance sheet, it is a kind of earthquake in the Verification market landscape. After the Denali acquisition by Cadence in 2010, nSys was most probably the market leader in verification IP, if we look at the independent VIP providers (excluding Cadence). The company VIP port-folio can bear the comparison with Cadence, as nSys supports: PCI family, Communication standards, Storage Interfaces, USB Port, DDR3/2 Memory Controller, MIPI, AMBA and some miscellaneous interfaces. nSys being privately owned, we don’t know the company revenue, neither if the company is profitable. Was this acquisition an “asset sale”, and just an opportunistic deal closed by Synopsys at low cost, with the side effect to compete directly with Cadence in a market where the company has heavily invested during the last three years? Or the goal is to consolidate Synopsys position in the Interface IP market, where the company is the dominant provider, present, and leader, in every segment (DDRn, PCIe, USB, SATA, HDMI, MIPI…), by adding “independent” VIP to the current offer?

Synopsys was offering “bundled” VIP, and this is not the best way to valorize the product, as the Design IP customer expect to get a bundled VIP almost for free. If Synopsys acquisition of nSys illustrates a real strategy inflection, another side effect will be the lack of accuracy of the “Yalta description”: Cadencedominant in VIP and Synopsysin IP market!

Only Synopsys and nSys management teams know the answer. Today we only can evaluate the impact of this acquisition on the day to day life of SoC design teams, when this SoC integrates an Interface IP… which happen in most of the cases.

I found an interesting testimonial on nSys web site: “We had debated using bundled VIP solutions, which were available with PCIe IP, but after evaluating the nSys Verification IP for PCIe, we dropped the idea. We were impressed by the level of maturity of the PCIe nVS. We also realized that the PCIe nVS provided us with the ability to do independent verificationof the IP that could not have been achieved with the bundled models. The nSys solution has helped our engineering team increase productivity too.” From Manoj Agarwal, Manager ASIC, EFI.

The important word in this testimonial is “independent”. We have expressed this concern in the past, when saying:

“Common sense remark about the BFM and IP: when you select a VIP provider to verify an external IP, it is better to make sure that the design team for the BFM and for the IP are different and independent (high level specification and architecture made by two different person). This is to avoid the “common mode failure”, principle well known in aeronautic for example.”

A SoC project manager will have the option to buy an “independent” VIP to run the verification of the interface function… to the same vendor selling the IP. He still can buy it to the main competitor (Cadence) or to one of the remaining VIP provider (Avery, ExpertIO, PerfectVIP, Sibridge Technology, SmartDV Technology), but the one stop shop argument (buy the Controller, the PHY and the Verification IP together) will be reinforced, especially because the VIP comes now from a real independent source.

Is Synopsys acquisition of nSys an opportunistic asset sale? Honestly I don’t know, but this is certainly a stone in Cadence’ garden (as the company has bought Denali in 2010 and products from Yogitech SpA, IntelliProp Inc. and HDL Design House in October 2008 to consolidate their VIP port-folio) and a threat for the remaining VIP provider. Is it good news for Synopsys customers? Yes, because the “one stop shop” will ease the procurement and technical support process. Synopsys customers should just make sure to buy at the right price… market consolidation can make life easier… and price higher!

Eric Estevefrom IPnest