No more shopping for Virage as Synopsys becomes the customer

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After going through an acquisition spree of its own, Virage Logic has agreed to be bought by EDA company Synopsys for about $315m in cash. The move follows only a month after Cadence Design Systems’ announcement of its plan to buy memory-IP specialist Denali.

The rationale from Aart de Geus, CEO of Synopsys, in the conference call for the purchase is not all that different from Cadence’s. “Putting together these IP blocks and making sure they work together is essential,” he said.

Like Cadence, Synopsys is expecting an increase in the use of third-party IP by chipmakers. “The trend of IP outsourcing is a massive trend. People are moving towards using commercial IP where they can except where they can add differentiation,” de Geus said, adding that a growing number of companies are realising what they thought was differentiated home-grown IP could be just a millstone. “What companies produce is not necessarily differentiated. Some of the standards they need to work with are so complex, their own people can’t necessarily do a cost-efficient job there. The downturn has helped many executives realise that outsourcing these efforts makes a lot of sense.”

De Geus argued that very little of the IP produced by Virage overlaps with that created at Synopsys. The EDA company backed away from the acquisition of memory-IP specialist Mosys in 2004 and has not developed its own. Even earlier, a move into standard-cell IP through the acquisition of Silicon Architects in the mid-1990s ended when Synopsys wound up the operation. De Geus explained that the move was “premature” and that it had gone into the business before it had a place-and-route tool (later acquired through its 2002 purchase of Avant) that would make use of those cells.

Virage’s roots lie in low-level IP such as memory cores and standard cells but has, more recently, moved into larger cores through the acquisition of ARC International and NXP Semiconductors’ IP design group. Potentially, the addition of the Virage line-up brings Synopsys into conflict with ARM, with which Synopsys developed the verification reuse and low-power design methodologies.

De Geus argued that the processors from ARC complement those of ARM, agreeing with one analyst’s use of the term ‘ancillary’ to describe them. “ARM is one of our most important partners and is a friend of the company, a company around which we have built a number of our offerings. ARC is interesting because it so supports the ARM core processor. It provides a controller that can be used for subtasks to offload the main processor. It will be interesting to see how we can build solutions with ARM.”

ARM has gradually backed away from areas that Synopsys has moved into in the IP space. The ARM Primexsys portfolio of peripherals failed to take off but Synopsys’s main successes in IP lie in this area. Although ARM has tried to get into digital signal processing (DSP), it is another area that the UK company has discontinued its effort, choosing to focus on graphics instead. ARC has, in contrast, focused heavily on audio and similar DSP-based products.

Where ARM and Synopsys will compete head-on is in standard-cell libraries and it’s a business where ARM has spent heavily to keep up with process technology. Having Virage provides Synopsys with a way to align design-implementation tools with the cell libraries, something that is becoming more important as design rules get ever more restrictive. Will ARM engineers get the same access to the Synopsys tools people post-acquisition?