On Target: Embedded Systems

Embedded World Bulletin – March 2010

VDC attended the 2010 embedded world Exhibition & Conference in Nuremberg, Germany March 2^nd and 3^rd. This bulletin presents a summary of the event.

 

This is the first time VDC Research has attended embedded world and according to the show closing report, there were 730 international exhibiting companies and 18,350 trade visitors. Both represent a record number of exhibitors and visitors participating in the exhibition and conference over previous years.

 

The show floor consisted of four interconnected halls with exhibitors logically grouped by the type of products offered. Over the course of two days VDC met with over 20 exhibitors and stopped in to chat with a number of others.

 

Wow! What a high energy event! The exhibitor halls quickly filled up with attendees in the morning hours. Many booths were filled with engineers presenting opportunities for exhibitors. Most exhibitors had big broad smiles when asked about the potential for quality leads. All and all, an exciting show for all participating in the conference!

 

However, these types of shows also offer an opportunity for exhibitors and non-exhibiting companies to examine their strategic partnerships including strengthening, expanding, and establishing new alliances. It also serves as a checkpoint for scoping out your competitors as well as new potential entrants. 

 

The 2010 Embedded Systems Conference/Silicon Valley is just around the corner. We hope that embedded world is a prelude to the type of energy and interest to be expressed by attendees at ESC/SV. If so it could just be the medicine that the embedded market needs for growth in 2010!

 

The complete press release and more information & downloads for embedded world can be found here.

 

WALKING THE FLOOR

 

Atego announced that it had acquired Blue River Software, a provider of embedded software development tools and related services based out of Nuremberg, Germany. This is just the latest in a recent spree of M&A activity undertaken by Atego/Artisan’s leadership.  To see our coverage of this and their previous moves, including a Q&A with Atego Chairman James Gambrell, please visit the links here.

 

Auriga, Inc. was co-located in the Birdstep Technology booth and was demonstrating with their partner the Raima Database Manager Embedded on Android. Auriga is an IT outsourcing services provider with operating software development centers in Russia since 1990 and was incorporated in the US in 1993.

 

dSPACE announced that the company is cooperating with Elektrobit in offering a coordinated AUTOSAR tool chain for developers of automotive electronic control unit software. In addition the company announced that they are also working NAVTEQ to create an integrated development platform for digital map-enhanced driver assistance systems.

 

Enea announced their hypervisor that implements multiple high performance computing environments on top of multicore processors. The hypervisor is based on OSE micro kernel technology and runs OSE applications at native speeds. In addition the company announced that they had been selected by FatSkunk, a supplier of anti-malware technology for mobile phones, to ensure delivery of its Android proof of concept.

 

Esterel Technologies featured announcements around their upcoming release of SCADE, version 6.2 which will incorporate enhancements to both SCADE Suite and SCADE Display with respect to integration with other tools in the development tool chain. The release features support for the SCADE Suite Rapid Prototyper and enhancements to the SCADE Suite Model Test Coverage. In addition the company announced that it is launching the Aerospace and Defense DO-178C Readiness program where Esterel will assist companies in their preparation for development of safety critical software under the pending DO-178C standard.

 

ETAS, a subsidiary of Robert Bosch GmbH, conducted a number of product demonstrations at the conference including a prototype of their RTA operating system for multicore CPU’s and AUTOSAR.

 

GrammaTech, Inc. announced that CodeSonar, the company’s flagship source code analyzer, has been selected by major U.S., European and Asia/PAC medical device manufacturers.

 

Green Hills Software had several announcements at the conference. On the first day the company announced that the INTEGRITY RTOS received CENELEC EN 50128 (railway industry standard) SWSIL 4 certification. This press release was complemented by an announcement that Bombardier had selected the Green Hills Platform for Industrial Safety which will be used in the development of their next generation train control management system. Other announcements at the show included a partnering agreement with IS2T to provide their hard real-time Micro-Jvm for use with the INTEGRITY RTOS and the availability of the INTEGRITY RTOS for the CPU Tech Acalis CPU872 secure processor.

 

IAR Systems had several announcements at the show including commercial-grade integration of Express Logic’s ThreadX RTOS and IAR Embedded Workbench IDE with support for 32-bit architectures, including ARM’s ARM7, ARM9 and Cortex-M3, Freescale’s ColdFire, NEC’s V850, and Renesas’s H8. In addition the company announced that their integrated development environment IAR Embedded Workbench has been selected as a part of Fujitsu’s SK-86R03 'Jade-L Starterkit' package.

 

IntervalZero announced that Acontis Technologies GmbH released its EtherCAT Master Stack AT-EM for IntervalZero’s RTX hard real-time software for Windows.

 

Keil, an ARM Company announced the release of MDK-ARM v4.10 which is the first software development tool to support the ARM Cortex M4 processor.  In addition the company announced the C51 V9.01 Professional Developer’s Kit with support for the Infineon XC82x and XC83x series. The XC82x and XC83x series expands Infineon's 8-bit XC800 microcontroller family to provide more scalable performance for cost-sensitive automotive applications.

 

LDRA and Visure Solutions announced the release of Embed-X, an end-to-end application lifecycle management (ALM) system for the embedded space. Embed-X, like other ALM solutions, merges product requirements, business objectives and metrics in a uniform actionable perspective. Embed-X also delivers these ALM objectives with full certification support for critical development standards in the avionics, defense, automotive and medical markets.

 

Mentor Graphics received the embedded award 2010 in the software category at the show for their Inflexion GUI Technology for Android. The Inflexion GUI is comprised of an embedded user interface (UI) engine and designer tool for the rapid creation and customization of visually rich, highly-usable GUIs for all types of Android devices featuring a graphical display.

 

QNX Software Systems, a Harman International (NYSE:HAR) company, announced its new smart energy reference, a pre-integrated software stack that makes it easier to design, deploy, and extend smart-home energy management systems. The company also announced that Texas Instruments is providing pre-integrated hardware support for the QNX CAR application platform. The collaboration will allow QNX CAR participants to take advantage of TI’s AM3517 and OMAP3530 processors, both of which are based on the highly popular ARM architecture.

 

Real Time Systems GmbH recently announced an alliance with QNX Software Systems and demonstrated their recently released RTS Hypervisor version 2.2 running the QNX Neutrino RTOS on the same hardware as Windows, and is also capable of running Linux and other operating systems.

 

SYSGO AG announced that B. Braun selected the company to develop the software application related to SpaceCom, one of the key components for its automated infusion systems. The company also announced the version 3.1 of their PikeOS that integrates multi-core support which is part of the DO-178B certified code base.

 

TenAsys announced the availability of eVM for Windows, an embedded virtualization manager that enables different RTOSs to run alongside Windows on the same multi-core processor platform. The eVM for Windows’ embedded virtualization technology utilizes hardware-assisted features built into Intel processors to allocate hardware resources and is available for download from the company’s new online store. In addition the company announced support for new Intel Atom processors with their INTime RTOS.

 

ULMA Embedded Solutions was present at the exhibition with their manufacturing partner Trelec. The company was founded in 2009 from the ULMA Group Business Incubator and focuses on providing embedded systems engineering services.

 

Wittenstein High Integrity Systems, a subsidiary of the German industrial technology group, Wittenstein AG, announced OpenRTOS support for the Renesas SH7216 microcontroller. In addition the company announced a SafeRTOS Design Assurance Pack for the SafeRTOS kernel that meets US FSA510 (k) Class III and European IEC EN62304 medical device certification requirements to run on Cortex-M3 and ARM7 based microprocessors.

 

Other leading embedded systems exhibitors included aicas GmbH, Altera, Analog Devices, Arrow Embedded Solutions, AvNet Embedded, Birdstep Technology, CMX Systems, CoFluent Design, Coverity, Datalight, DENX, eCosCentric, Express Logic, Freescale,  GEENSOFT, IBM, Intel Corporation, itemis AG, Klocwork,  Kontron AG, Lauterbach GmbH, LDRA, LynuxWorks, Marvell, McObject,  Micrium, Microsoft, MKS GmbH, National Instruments Germany, Nokia Norge AS, Parasoft, Perforce Software Europe, PragmaDev, RadiSys GmbH, Serena Software GmbH, SparxSystems GmbH, Target Compiler Technologies, TASKING by Altium, Texas Instruments, The MathWorks GmbH, Vector Software, Willert Software Tools , Wind River GmbH, Xilinx Europe,  and many, many others.

Embedded Industry Expert Opinions Needed

VDC is conducting its annual survey of mobile and embedded engineers so if you are involved in the engineering of mobile or embedded systems/software, this is your chance to influence key solution suppliers.

 

The research covers embedded software, hardware, tools, and development practices. Your thoughts will improve our insights into the engineering community and help to influence next generation solutions.

 

In addition, VDC will provide all respondents who complete the survey:

 

* Instant access to a summary of VDC's 2009 survey findings;

* Entry into a prize drawing for one of five $100 Amazon.com gift certificates (drawing to be held August 15th, 2010); and

* A summary of the 2010 survey findings once the survey is complete later this year

 

 

To begin the survey, go to:http://vdcresearch.com/survey/10_esdt.html?RID=OT

 

 

Thank you very much for your assistance.

 

 

Best Regards,

 

The VDC Embedded Software and Tools Research Team

Bits and Bytes – In case you missed these announcements from the last week or so…

Green Hills Software Announces End of Embedded Industry Recession

 

Wind River Extends Virtualization Support with New Release of Wind River Hypervisor

 

Synopsys Acquires VaST Systems Technology Corporation

 

Green Hills Software Supports Freescale P2020 Multicore Processor

 

Wind River Delivers Suite of Multi-architecture Embedded Software Development Tools

 

Dell Announces Alliance with INTEGRITY Global Security

 

Synopsys to Acquire CoWare, Inc.

 

Enea signs partner agreement with Freescale

 

LDRA and Visure Partner to Offer Embedded Application Lifecycle Management Solution

 

Symbian Completes Biggest Open Source Migration Project Ever

 

Wind River to Add Virtutech Simics Products to Comprehensive Embedded Software Portfolio

 

Mentor Graphics Catapult C Adds SystemC Synthesis and Expands Full-Chip Capabilities

 

Nuance Voice Control for Automotive Powers Speech for Leading QNX Car Application Platform

 

Macraigor Systems Extends On-Chip Debug Support to Intel’s Atom Processor

 

Lauterbach, Discretix Announce Alliance to Provide Secure Chip Debug Capability

 

Wind River Updates VxWorks DO-178B Platform for Aerospace and Defense Systems

 

Apple Launches iPad

 

GrammaTech Achieves Record Growth in 2009

 

OpenTV and Coverity Announce Software Integrity Collaboration

 

Atego launches as the foundation for an integrated tool chain strategy

 

GNAT Pro support for PikeOS – New Safety-Critical RTOS Platform for GNAT Pro High-Integrity Edition

 

BAE Systems Selects MontaVista Software to Power New Artillery and Naval Gun Systems

 

 

VDC Research looks forward to companies contacting us for a briefing on new announcements around products, new partnerships and alliances, or other changes within your organizations. At a minimum please make sure that we are included in your press/analyst relations distribution list for new announcements as they become public.

Telephone: 508.653.9000.

Steve Balacco, Director, sbalacco@vdcresearch.com, x124

Chris Rommel, Analyst, crommel@vdcresearch.com, x123

Jared Weiner, Analyst, jweiner@vdcresearch.com, x143

The iPad, the iPhone, & the iFans

Driving the evolution of the mobile and embedded software engineering landscape

 

What happened?

 

On January 27^th, Apple (NASDAQ: AAPL) finally announced its not-so-secret new e-reader/netbook/tablet mobile device.  With all speculation about its name, price, and features now at rest, more questions about the iPad’s potential impact on the mobile and embedded software landscape have begun to rise to the surface.

 

VDC’s View

 

There is no doubt that the iPod helped revolutionize the way people buy, store, and listen to music.  Nor could there be much contesting that the iPhone/iPod touch further catalyzed the transformation of the ways that people interact with multimedia.  But arguably the most transcending effect of Apple’s successful innovation/marketing has been on consumers’ expectations for sophisticated and intuitive user interfaces and for their devices to provide them with highly customizable user experience.

 

Beyond the effects on the music business alone, the iPhone has helped stimulate the rapid expansion of third-party application markets.  Although the ultimate appetite of consumers for yet another device is yet to be determined, the iPad already has what WinMo, Symbian, Android, Amazon, and HP (just to name a few) could only dream of – over 140,000 compatible applications and the iFans, a sea of devoted evangelists, fans, and developers.

 

If the iPad is a commercial success, we expect that the iFans’ expectations for top-tier functionality and ubiquitous, real-time content will drive a greater formalization of the third-party application engineering community – especially given the iPad’s form factor, which opens the door for new applications classes and higher app price points.  Moonlighters and cowboy coders will certainly continue to contribute to the breadth of content and applications accessible, but we expect more, large institutional engineering organizations and ISVs to fuel the next generation of sophisticated apps that will raise the bar once again for the consumer experience.

 

Enter the Embedded/Mobile OS Market Players

 

The evolution of third-party application markets along with the growing adoption of non-proprietary, open source, and consortia-based operating systems have continued to squeeze the traditional value proposition offered by traditional OS vendors attempting to compete in consumer-oriented verticals.  We have already seen a number of these OS vendors race to strengthen their professional service networks and quick-start integration capabilities. 

 

As more OEMs and ISVs attempt to tap into the mobile application market’s power to create new revenue opportunities and/or to strengthen/maintain their brands with the next generation of consumers, application OS vendors just might find their salvation through the functional expertise that once built up a billion dollar market for commercial mobile OSs.

 

Related Posts:

 

• Nexus One Google Another Battle in the Mobile OS Wars
• Welcome, Mentor Graphics. Seriously.
• UPDATE: Nokia to Acquire Symbian Ltd. – Can you hear me now?
• Head for High Ground: Market Pressures Squeezing Value up the Linux Software Stack
• Linux Adoption in the Embedded Market Presents Challenges to Commercial Suppliers

Nexus One Google Another Battle in the Mobile OS Wars

The long-awaited announcement from Google was released today for the Android-based Nexus One smartphone (the first in a series of products to be released by Google) or what Google refers to as an emerging class of “superphones.”  The phone is initially selling through Google’s web store at a subsidized price of $179 with T-Mobile service, or for $529 unlocked.

 

Before we talk about what the Nexus One Does represent to the mobile and embedded community, let’s talk about what it Does Not.

 

Nexus One Does Not:

 

• Represent the long-anticipate “iPhone killer”.   With a feature set that is unarguable nice but by no means earth-shattering, the Nexus One represents just another potential substitute for Apple’s offering and, if nothing else, provides further validation of the achievements Apple’s iPhone made when it was first introduced into the market.
• Force feed users advertising as a means to further subsidize cost.
• Fundamentally alter mobile phone purchasing behavior – How many of you people are actually willing to buy the phone for $529?  My guess is that a lot of consumers will wait until it comes out at subsidized prices with other carriers in the spring.

 

 

What Nexus One Does:

 

• Provide further proof of the potential success and subsequent proliferation of an embedded Linux derivation (Android) within consumer facing applications.
• Represent another example of software functionality and brand promoted to the forefront of product marketing and consumer decision making.
• Raise (yet another) red flag in Redmond.  
• With Windows Mobile (phone?) already in a tailspin, Microsoft is watching its biggest mobile supporter, HTC, come to market with another new Android device.  
• Should Microsoft look to take another step away from its high per unit royalties in mobile?  If so, what type of pricing pressure could that subsequently cause in the rest of the device classes in which it competes.
• Perhaps drive the once unassailable leader in the smartphone OS market, Symbian, further behind in this rapidly evolving market.
• In its current state, Symbian Foundation just does not appear to have the resources available to effectively market Symbian OS and attract third-party application developers – let alone play catch-up within the US where RIM, Apple, and now OHA already have established themselves and saturated consumers with incessant marketing campaigns.
• Place further emphasis on software and tools vendors’ ability to offer OEMs premium development tools and experienced professional service organizations that can allow OEMs to quickly adapt their legacy software to new platforms and get their product to market as quickly as possible.

 

 

Stayed tuned as VDC looks to comment further on this announcement and other Mobile Operating System market trends here in our blog and in our upcoming report, Volume 3: Mobile Operating Systems from our 2010 Embedded Software and Tools Market Intelligence Service.

 

 

Related Posts:

 

• Welcome, Mentor Graphics. Seriously.
• UPDATE: Nokia to Acquire Symbian Ltd. – Can you hear me now?
• Head for High Ground: Market Pressures Squeezing Value up the Linux Software Stack
• Linux Adoption in the Embedded Market Presents Challenges to Commercial Suppliers

2010 Embedded Software & Tools Market Update & Outlook - Webcast Available

We want to thank everyone who attended our webcast, "Embedded Software and Tools Market Update & Outlook."  We hope you found the content both useful & interesting.  

In case you missed the live webcast, here is a link to its recording and slides.  Please note that registration is required to view the recording .

Please be sure contact us directly if we can help answer any questions you may have on the presentation or our thoughts on the 2010 embedded software and tools market in general.

2010 Embedded Software & Tools Market Update & Outlook - Webcast Today!

It is not too late to register for today's webcast!

During this complimentary webcast, we will discuss the challenges facing embedded device and systems manufacturers and their embedded solutions providers and offer our thoughts on how they will have to adjust given the current economic climate. Specifically, the webcast will address the following key questions: 

• How have economic conditions affected embedded software solution suppliers?
• What does the competitive landscape look like?
• How will supplier consolidation affect the market?
• How are multi-core requirements impacting embedded software development?
• What types of tasks are being outsourced by OEMs and what are the opportunities for embedded software solution suppliers and partners?

When?

Tuesday, December 8, 2009 1:00 pm
Eastern Standard Time (GMT-05:00)

Click here to register

2009 Embedded Engineering Survey Data ~ Available Now!

With the increasing complexity of embedded software and hardware designs, the 2009 end-user data books provide insight into the behavior, opinions, and demographics of embedded engineers, the degree to which embedded system engineering tasks are converging, and key system engineering trends likely to impact embedded systems manufacturers and solution providers over the short and long term.

This end-user data is based on detailed Web survey responses collected in the late May 2009 to mid September 2009 time-frame from over 780 embedded systems engineers worldwide and offer an understanding about the dynamics of the embedded market as they relate to current and future product development trends. This detailed end-user data provides access to VDC’s extensive knowledge of the embedded developer community and is intended to provide insight into specific embedded developer communities’ current development and future project trends based on the individual report topics.

The Embedded System Engineering Survey Data is available in reports offering segmentations by:

• Operating Systems
• Development Tools
• Vertical Market
• Region
• Processor Architecture
• Engineer Type

What’s new? different? the same?

• Although these reports are organized into six volumes similarly to previous offerings, this year’s reports also include PowerPoint presentations, highlight key findings and offering some analysis around the results and broader market trends.
• We continue to ask many of the same questions as previous years for year-over-year comparison.
• For a full the Full List of Exhibits from the 2009 and 2008 Survey Data reports, click here and here.

Who should be interested?

Software (ESW, ESL, and EDA) and hardware (silicon and board) solution providers (whether currently engaged in the embedded market or not) should find this information of interest, as these reports provide valuable insight into the types of current and future requirements and methodologies that companies are using to engineer embedded systems.

 

This information can be used to assist companies in differentiating solutions, developing competitive strategies, and engineering products that better meet current and future customer requirements. In addition, the data can also be used to support key marketing and sales efforts.

Systems manufacturers and semiconductor suppliers will also find value in this data in developing an understanding of key system engineering trends that will impact their business in the short and long term, gaining a perspective on the embedded software and hardware market, and an understanding of the vendor options available to them.

What information are we collecting in 2010?

 

VDC will be launching an update to this Survey in the Q1/Q2 time-frame of 2010 as part of our 2010 Embedded Software Market Intelligence Service.

 

With the 2010 Service currently under founding sponsorship, early subscribers can provide input into what additional questions are asked of the embedded engineering community. 

 

We are also interested in your general feedback and suggestions, so please reply with comments!

For further information about VDC’s Embedded Software Market Intelligence Service contact:

Steve Balacco, Director, 508.653.9000 ext. 124, sbalacco@vdcresearch.com

Chris Rommel, Analyst, 508.653.9000 ext. 123, crommel@vdcresearch.com

Cyril Bernard, Senior Account Executive, 508.653.9000 ext. 142, cbernard@vdcresearch.com

Or

Visit our website.

Webcast: Embedded Software and Tools Market Update & Outlook

The successful use of embedded software and system engineering tools is a critical requirement for companies across every market segment. Although the recession is expected to continue to impact the market for embedded software and system engineering tools, systems manufacturers will persist in requiring new solutions that help them create, test and manage the designs necessary to power the next generation of embedded systems.

Software and solutions suppliers that can sharpen their focus, value proposition and solution package to address market pressures and constraints will differentiate themselves in this highly competitive marketplace.

During this complimentary webcast, we will discuss the challenges facing embedded device and systems manufacturers and their embedded solutions providers and offer our thoughts on how they will have to adjust given the current economic climate. Specifically, the webcast will address the following key questions:

• How have economic conditions affected embedded software solution suppliers?
• What does the competitive landscape look like?
• How will supplier consolidation affect the market?
• How are multi-core requirements impacting embedded software development?
• What types of tasks are being outsourced by OEMs and what are the opportunities for embedded software solution suppliers and partners?

 

Who Should Attend?

Marketing, Sales, Product Management, and BD Executives from:

• Embedded software solution suppliers
• Semiconductor and semiconductor IP suppliers
• Board/Hardware suppliers
• Professional services firms
• Embedded system manufacturers

 

When?

Tuesday, December 8, 2009 1:00 pm
Eastern Standard Time (GMT-05:00)

 

Where?

Click here to register

Cavium Networks Signs Definitive Agreement to Acquire MontaVista Software: Part 2

 

Linux at the Core (or Multicore) of another Acquisition

 

 

What Happened?

Cavium Networks (NASDAQ: CAVM) announced that it has signed a definitive agreement to acquire MontaVista Software for $50 million. The acquisition is expected to close in December 2009 and is comprised of approximately $16 million in cash and approximately $34 million in Cavium Networks common stock.

 

Why…

Did Cavium buy MontaVista Software?

Cavium has maintained a significant growth rate in recent years, surpassing $86M in revenue after being founded just nine years ago.  However, Cavium’s business to date remains focused around the networking space.  Although there is a substantial customer overlap in this industry with MontaVista, MontaVista also provides Cavium with customer relationships in the mobile, consumer electronics, industrial automation, and automotive industries, among others. 

The acquisition of a software company also allows Cavium to diversify cash flow and recognize revenue beginning at the time of a design win, as opposed to just at semiconductor product shipment.  Additionally, the acquisition provides Cavium a way to earn revenue from projects even if they are not selected or in competition for the socket.

Access to a commercial grade distribution of Carrier Grade Linux (CGL) is critical to Cavium’s strategic plans to grow their business within the networking space.  We also expect that this acquisition is a defensive move on the part of Cavium  given that an acquisition of MontaVista Software by another company, semiconductor or otherwise, and a change in access to an Intel/Wind River CGL distribution could present serious risk around Cavium’s long-term ability to provide tightly integrated HW/SW solutions to their customers.

The importance of this relationship is amplified when comparing Cavium’s R+D resources to that of some of the much larger silicon companies.  As such, there is a much larger onus on Cavium to differentiate their solutions through software and integrations.  MontaVista provides Cavium with this opportunity, without applying the time and resources internally to ramp up their own software enablement products and services.

Did MontaVista sell itself to Cavium?

Although it was no secret that MontaVista has been up for sale, ever since rumors first emerged about a potential Sun Microsystems’s acquisition, the ultimate suitor and - even more so - the timing of the deal surprised many embedded market participants.

MontaVista was the uncontested pioneer in the commercial embedded Linux market.  However, over the course of the past four years, Wind River went from an assailant to a proponent of Linux, ultimately eclipsing MontaVista’s once dominant market share.  Over that same time period, VDC estimates that MontaVista was unable to capitalize on overall market growth and achieve profitability, even ten years after its founding.

That said, we thought MontaVista would emerge as one of the big winners following Intel’s acquisition of Wind River and convert the uncertainty in the market into increased revenue (perhaps to inflate a subsequent acquisition price tag).  Instead, Cavium’s acquisition registered in at less than 1.5x 2008 revenues (by VDC’s estimates).

In VDC’s opinion, MontaVista could not afford to shun another offer.  Their investors had shelled out more than $100 million over the years and were likely unwilling to miss another window to sell.  Perhaps more importantly, this is not Jim Ready’s first rodeo.  He previously steered Ready Systems of VRTX fame to merge with Microtec in 1993 and then to an acquisition by Mentor Graphics in 1995.  It is clear that Cavium provides an environment where MontaVista can enhance its financial stability, bolster its access to R+D resources, and can still materially contribute to the larger company’s bottom line.

 

 

Reaction and Analysis

 

Overall, the reaction to this acquisition was rather tempered compared to that after Intel’s acquisition of Wind River in June.  This sentiment is not surprising since MontaVista was less than 1/10^th Wind River’s over size from a revenue perspective. First off, the WinDTel announcement sent enough of a shock wave through the marketplace, that both Intel and Wind River have committed significant time and effort to ensuring their customers and partners understand and believe that they have every intention of maintaining the autonomy and neutrality between the two companies.  As a result, the spirit of much of the messaging that a Cavium/MontaVista is now delivering has already been heard in recent memory.

 

Cavium’s position as licensee of semiconductor IP from both MIPS and now ARM (after its acquisition of Star Semiconductor last year) also reinforces the need for it to maintain a strong ecosystem of partners with other software and hardware providers.  In addition, Linux is, by its nature, open, which ultimately compels similar advocacy and business development tactics by those companies trying to commercialize it.

 

So what can we take away from this continued consolidation and industry shake-up? 

 

Many semiconductor companies were more or less surprised by the emergence of Cavium as the final purchaser – but also more or less happy it wasn’t a larger market participant.  At least to date, companies we spoke with also reinforced their satisfaction with Wind River’s concerted efforts at ambassadorship and partnership since their acquisition and have similarly been pleased by the initial outbound communication and reassurances by MontaVista.  In addition, the acquisition also validates current and necessitates further investment in the software enablement strategies by semiconductor market participants

 

In the eyes of many software and tools providers, this consolidation presents, if nothing else, further incentive to strengthen partnerships with other embedded solution providers.  It also offers an opportunity for software and tool companies to expand or (regain) market share in the telecom/datacom market (not only from a Linux perspective, but also with respect to the RTOS and standalone development tools markets). 

 

It may be many more months or even years before the dust settles and we can judge the success these – and likely additional acquisitions occurring on the heels of this recent recession.  However, it is already clear that the days of standalone, best-of-breed solutions are waning – more than ever, as OEMs are looking for tightly integrated development solutions and platforms that can offer accretive benefits to their overall cost of development and improve time-to-market.  It is up to all market participants to react to this changing environment. 

 

 

One question remains: When the dust settles, who will be left standing?

 

 

Click here to read Part 1 of our analysis.