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Siemens’ Acquisition of UltraSoC Shakes Up EDA / SIP Markets

On June 23rd, 2020, Siemens AG signed a letter of intent to acquire Cambridge, UK-based 3rd Party Semiconductor Intellectual Property (SIP) vendor, UltraSoC. Terms of the transaction were not disclosed except to say Siemens plans to integrate UltraSoC’s technology into the Xcelerator portfolio as part of Mentor’s Tessent™ software product suite. The acquisition is expected to close in Siemens 4th fiscal quarter this year.
There are several areas where this acquisition is impactful to the SIP market, the EDA market and the broader semiconductor market.
SIP Market Impacts:

  1. Although small, UltraSoC was a growing SIP vendor with a very competent technical staff and was highly regarded in the SIP market. They have a unique product portfolio aimed at embedded analytics for life-cycle management of semiconductor products, functional safety capabilities and embedded Security SIP that offered both detection of external security threats and the ability to launch countermeasures against those threats.
    1. The ability to launch countermeasures, as part of the standard package of Security deliverables, is fairly unique in the Security SIP space. While others can offer the same type of functionality, this is usually on a custom basis and not part of the standard offering.
    2. The functional safety capabilities are especially interesting to the automotive and the industrial markets, making these products even more valuable to Siemens and Mentor since both of them are heavily involved with customers in both sectors.
  2. UltraSoC will continue to license its embedded analytic and Security SIP into the semiconductor market, now as part of Siemens-Mentor.

Security SIP Market Impacts:
The Security SIP market has been steadily growing as concerns have grown over the susceptibility of different semiconductor solutions to external threats and hacking. Awareness of these issues has grown to the point where the conversation is no longer about whether or not to have security functions but how much security we should have. There are many vendors in the market today and differentiation between the competitors is difficult to achieve. The feeling has been that the large number of competitors made it very difficult to survive in this market. The counter to this has been that the knowledge and expertise necessary to successfully design in security functions is fairly rare and difficult to find. This market will continue to grow as the need to secure SoC solutions for IoT, IIoT, Automotive and mobile systems continues to mount.

  1. Perhaps the largest impact on the market from this acquisition is the realization that innovative security solutions that are not strictly based on pre-existing standards can be accepted by the market and can be quite valuable.
  2. An innovative approach to creating robust security functionality that designers without specific expertise in security functions can use and succeed with is a welcome addition to the market.
    1. In essence, UltraSoC created a basic capability in the security SIP market that their customers can take and run with to adapt the security functions to their own specific applications – a very valuable feature since every application is different.
  3. In addition, since the UltraSoC SIP does not overly rely on pre-existing standards for Security SIP, each implementation can be somewhat customized to fit the specific application. This in itself is valuable since it keeps any adversaries guessing as to the specific implementation being used and makes it even more difficult to penetrate the security protocols since they are not explicitly known beforehand.

Figure 1: Comparison of Growth Rates for Total SIP Market and Security SIP and Logic SIP

Forecast*                                                                                                                              Source: Semico Research Corp.
As Figure 1 shows, the Security SIP market has a higher growth rate than the Total SIP market over the forecast period. Logic SIP, where the UltraSoC embedded analytics and functional safety capabilities reside also have a high growth rate. This would be another reason why Siemens-Mentor was interested in UltraSoC: their products align favorably with the higher growth areas in the SIP market. In fact, the UltraSoC embedded analytics could be considered as a distributed SIP Subsystem product when fully implemented around an SoC since their SIP touches all aspects of the part – the CPU core, the embedded memory, the memory controller, the SerDes channels, etc. This SIP is one of the very few examples of a distributed SIP Subsystem and could be considered as a platform to build on for future enhancements and additions.
EDA Market Impacts:

  1. Mentor is a big beneficiary of the UltraSoC acquisition because they have gained access to a type of SIP that is unique in the market and are entering a market that has a very high growth rate.
    1. Mentor is already a well-established vendor in the SIP market for embedded memory BIST products, so they are no stranger to the 3rd Party SIP market. This addition to their SIP portfolio is very complimentary since Security SIP and memory BIST products are usually found together in many SoC designs today.
    2. While there is plenty of competition in the Security SIP market, UltraSoC stands apart with its ability to detect intrusions and launch countermeasures to blunt or stop the intrusions.
  2. The capability of the UltraSoC SIP to perform analytic functions while the silicon it is designed into resides in the field to find and fix bugs or spot problem areas in real time and is a key feature that more and more semiconductor and systems companies are using to ensure the best possible operation of their products to their customers. This makes the Mentor EDA Tools more attractive to potential customers since more capability and functionality is now available to them from one source.
    1. Combined with the capability of AI systems to spot trouble areas in system operations, now there the possibility to also perform predictive maintenance on the system remotely using the analytics UltraSoC provides. This could be a very powerful combination and an added selling point for Mentor’s EDA tools.

Semiconductor Market Impacts:

  1. The addition of UltraSoC to Siemens-Mentor will be a boost to the industrial products Siemens produces for IoT, IIoT and automotive markets. The increased capabilities possible through adding embedded analytics and functional safety protocols to these market segments gives Siemens an advantage over other semiconductor vendors that don’t have a total ‘life-cycle’ capability for their customers.
  2. The added capability of Security SIP that offers countermeasure capabilities to its users could be a key differentiator in the race to ensure that IoT solutions are secure and have robust security features.
    1. It is not difficult to imagine that with the increased resources available by being part of a multibillion-dollar company like Siemens-Mentor, additional enhancements to the UltraSoC product portfolio will be possible in the future.
  3. In the emerging AI market, one key area of concern to designers is the issue of determinism in the operation of the AI-SoCs. Essentially, when running a set of data points through the AI architecture inference algorithm, it is possible to get two different answers. Much effort is going into determining why this occurs and the embedded analytic tools that UltraSoC has may be a key element in identifying the possible causes of this effect.
  4. This acquisition fits very well with the areas Siemens Digital Industries Software was already focusing on and should be highly synergistic to both companies product portfolios:
    1. Cybersecurity
    2. Digital Twin capability
    3. Product Lifecycle management

Semico views this acquisition and its impacts on the various markets profiled as very beneficial to Siemens-Mentor, to UltraSoC and to the customers of both companies. With access to the greater resources to be found within the Siemens-Mentor envelope, UltraSoC can continue to innovate and develop even more compelling products in the future.
Future Impacts on the Semiconductor Industry
Looking further down the road and speculating a bit, Semico can see a few areas where this new alignment can have big impacts on the semiconductor industry.

  • Given the fact that the embedded analytics SIP of UltraSoC has now been conjoined with the verification capabilities of Mentor, we could see a “razors and razorblades” scenario where products are created that allow the embedding of the analytics SIP tied to the verification platforms of Mentor. The end result would be to enable a total design to deployment to operation of SoC silicon lifecycle management capability where changes to the silicon can be made using the Mentor tools tied into the UltraSoC analytics SIP resident in the device. This would enable real time, in the field monitoring, configuration and reconfiguration of the silicon in response to changing conditions and market requirements. This goes beyond finding and fixing bugs in the field and enters the realm of true management of the silicon over its lifetime in all the areas of interest to designers and customers.
  • With this type of capability inherent in the devices, adding some AI capability to the SIP and to the EDA tools brings the possibility of predictive maintenance and response to changes in the environment where the silicon operates.
  • The expansion of the ‘digital twin’ concept into the security SIP area and also into the embedded analytics area gives designers new capabilities to use in creating safer, more secure and better performing silicon solutions.

There is no guarantee that Siemens-Mentor will pursue these areas of product development, but it seems likely that the combination of the different capabilities each company possesses could lead in the directions outlined above. The UltraSoC SIP lies in the arena of basic capabilities that are now available to designers and product developers and fosters innovation and inventiveness. These are good qualities to have in any product and we expect Siemens-Mentor to take full advantage of them in the near future.
Ultimately, the UltraSoC story is one of a company that had a vision of the value of embedded analytics and what potentialities it could bring to the market in terms of new capabilities and functionality. They executed on this vision and continued to create new capabilities in new areas not necessarily associated with the original product. Security SIP does not readily come to mind as something that could be combined with embedded analytics, but in thinking outside the box, they came up with products that are combinatorial in their features and additive in the functionality they deliver to their customers. At the end of the day, it is all about providing solutions to difficult questions and issues and Siemens-Mentor has recognized these qualities in UltraSoC.