IP Adds Long Revenue Tail to Semiconductor Chips

Helping start-ups and smaller companies productize and sell their unrealized but
licensable IP are the collective goals of IPextreme, the GSA and others.

By John Blyler, Editorial Director, Chip Design Magazine

Semiconductor IP touches every part of the supply chain, from foundries and chip design
companies to EDA tool vendors and IP service providers. IP-Extreme is in the later
space, enabling companies to extract value from the unrealized intellectual property of
their chips. Achieving this goal is no small matter as System-on-Chip (SoC) complexity
doubles every 18 months.

The potential revenue afforded by IP can not be ignored. Warren Savage, CEO and
president of Extreme, talked about IP’s long revenue tail at the recent GlobalPress
eSummit 2012. “Semiconductor IP adds a long tail to the SoC revenue stream while also
opening new markets,” explained Savage (see Figure).

IPextreme’s business model is built on enabling this long revenue stream by extracting IP
from chips. This may sound like a simple process, but creating licensable IP requires a
range of skills and activities, from potential IP assessment, product definition through
documentation creation and product packaging. [Software readers will find a parallel in
Brook’s discussion of productizing application code from, “The Mythical Man-Month.”]

Extracting a company’s licensable IP and turning it into a product is one thing.
Delivering it and providing technical support and bug fixes to customers is another
matter. That’s where IPextreme’s Xena can help by enabling IP companies to manage
and distribute their IP both internally and externally to potential licensees.

How can companies further realize the long tail of IP revenue by reaching potential
licensees? IPextreme is working the GSA create a website for start-ups to locate IP,
related tools and services. The GSA’s Capital-Lite Resource Portal is powered by Xena
to manage and use this IP, including packaging, cataloging, delivery and support.

It’s important to note that IP-Extreme is not involved in the actual design of
semiconductor IP. Still, one might wonder if there was any connection between the
company’s extraction technology and existing IP modeling and integration tools? I asked
Savage how the GSA website compared to the Chipestimate.com or Synopsys’s
TLMCentral.com sites. His response focused on the high-level TLM modeling portion of
my question, noting that, according to a recent GSA survey, very few people were willing
to pay for modeling of IP. (I’ll look at this issue more closely in a future blog.)

Savage emphasized that his company was not a representative for or distributor of
semiconductor IP. The company’s goal was to provide chip designers with additional
revenue from the extracting and packaging of their licensable IP. To further aid in the
goal, the company created its Constellations program to enable collaboration at both the
marketing and engineering levels for a collection of IP companies. Membership in the
program is open only to non-competing companies to encourage teamwork. Like many
similar programs, this one attempts to create an environment in which select companies,
“work together and share resources to promote mutual success.” (see IMEC, Minalogic,
GSA)

Constellations membership currently includes Analog Bits, Certus Semiconductor,
Northwest Logic, Sonics, Inc., and IPextreme itself. The collaborative program is aimed
at smaller companies that struggle to fund both marketing and technical resources for
their IP products. Xena is the tool that ties all aspects of this collaboration together.

Engineers are great at creating technology that works. They are no often as good at
marketing and selling the resulting products. The Constellation program addresses this
shortcoming by allowing members to recommend IP to anyone with an email address and
a Xena account (guests, customers and members). Prospects can follow-up on the
recommendation privately with the provider. Members are rewarded with a small credit
toward their Xena licenses for each referral.

Chip design companies can realize additional revenue by extracting licensable IP from
their SoCs. But successfully productizing and supporting that IP requires a workable
framework from companies like IPextreme and organizations like the GSA.

First published May 8, 2012 on Chipestimate.com

jblyler‏ @Dark_Faust
@globalpresspr   @ipextreme  Chip +  #IP  adds long tail on revenue stream and opens new
markets. @chipestimate   #semip