IP Market: CPU Still The Largest But Security Leads In Growth

The 3^rd Party Semiconductor Intellectual Property (SIP) market has seen great innovation in the products it offers to System-on-a-Chip (SoC) designers over the last ten years. If any market segment in the semiconductor industry typifies the intense evolutionary pressures that the entire electronics market has undergone, it is the 3^rd Party SIP market.

Most of these evolutionary forces are driven by the need to integrate more functionality in fewer devices at the system level and in ever-smaller footprints. The primary method to accomplish this today is through the use of 3^rd Party SIP. The SIP market has evolved to supply the solutions SoC designers require to craft their very innovative silicon products in response to ever-changing market requirements and to allow new capabilities and functionality to be incorporated in cutting edge silicon solutions.

As the semiconductor industry enters the latter half of the second decade of the 21^stcentury, substantial changes to the System-on-a-Chip (SoC) design methodology are taking shape. These changes will create a new standard for how these very complex silicon solutions are conceptualized, designed and implemented for at least the rest of this decade and possibly longer.

In the latest report published by Semico Research Corp., Licensing, Royalty and Service Revenues For 3^rd Party SIP: A Market Analysis and Forecast for 2016, SC105-16, data is broken out into categories by function.

Each category consists of licensing, royalty and service revenues with actual revenues tracked from 1Q06 – 2Q16 and a quarterly forecast out to 4Q20.

Semico’s data and analysis found the following:

• The CPU IP market is the largest IP category today and will remain so for the foreseeable future, accounting for 31.3% of total market revenues by 2020.
  • A new CPU IP architecture has been introduced by ARM that is focused on processing data around safety standards and implementing those protocols in a system. This continues the theme of developing CPU architectures that are not general purpose, but are specific in nature such as processors for vision, signal processing, graphics processing and video processing.
• Memory IP was the second largest IP category in 2015, driven by the need for increased resources on SoCs to handle the large number of CPU cores designers are employing in their silicon solutions today. By 2020, the Memory IP market will account for 13.9% of total market revenues.
  • New embeddable memory architectures are entering the market as licensable IP today. MRAM is being supported by TSMC and GlobalFoundries. Other non- volatile memory types such as STTRAM and ReRAM are poised to debut. In addition, a new memory type based around carbon nanotubes (CNTs) is also starting to gain some traction in the market.
• Interface IP is the third largest IP category in 2015, driven by the increasing need for SoCs to handle both high speed data and connect to the outside world. The Interface IP market will account for 10.9% of total IP revenues by 2020.
• The market for Security IP is small today but will grow in importance and necessity as portable wireless devices permeate our society and require increased protection from viruses and denial-of-service attacks. This will be especially true to secure data in the emerging IoT market.
  • The industry discussion surrounding the need for Security IP has resulted in a consensus: the industry needs more security. Now the discussion has shifted to how much Security IP in the silicon is enough.
• A licensable programmable logic fabric is entering the market from several different companies and could generate significant revenues in the SoC market as adoption increases and the technology matures.

Overall, the market growth rate for revenues from 2015 – 2020 is somewhat lower than in previous forecasts. This is due more to the law of large numbers than to a slowing of demand. Market consolidation will undoubtedly have some impact on revenues and growth rates in the future.

For additional information on Semico’s report, Licensing, Royalty and Service Revenues For 3rd Party SIP: A Market Analysis and Forecast, SC105-16, please contact [email protected].