11 posts categorized "TMESE"


Converged Devices Cannibalizing Sales of Stand-alone Consumer Electronics Devices

But also driving the transition to multicore processors

The consumer electronics industry continues to foster a wide variety of innovations that bring cutting-edge technologies to the mainstream. Mounting demand for internet connectivity, inter-device communication, and device mobility have been the key factors driving this innovation. From televisions and set-top boxes to digital cameras and video gaming systems, the ability to access and share content via the web has become one of consumers’ primary device requirements. Similarly, growing interest in device mobility has fueled momentum behind handheld devices such as portable gaming systems, e-readers, and portable media players.

More than ever, today’s consumer electronics products are capable of serving a wide range of functions. Video game systems can play DVDs and Blu-rays, tablet computers can be used to play music, videos, and games, digital televisions and set-top boxes function as web browsers and media hubs, and so on. In many instances, this convergence of device capabilities has led to surges in demand for certain application classes while cannibalizing sales of others. Mobile phones have frequently been at the center of this phenomenon, as the growth of the smartphone market has in part come at the expense of digital cameras, stand-alone GPS devices, mp3 players, and other single-function products.

VDC believes this trend of device convergence is likely the primary determinant driving the growing adoption of multicore processors in this market, a topic which VDC has been following for a number of years. Clearly, single processor-based consumer electronics devices are on the decline, according to respondents to VDC’s annual Embedded Engineering Survey:

While multiprocessor designs exhibited the largest increase from 2010 to 2011, VDC expects that multicore will ultimately represent the primary architecture embraced by engineers in this space, particularly those developing devices with a broad range of capabilities. However – as VDC has noted in the past – the key question remains: how quickly will this transition take place?

VDC investigates this and other vertical market specific trends from across the embedded landscape in our upcoming report, Vertical Markets & Applications, from our 2011 Embedded Software & Tools Market Intelligence Service. This study will provide an analysis of individual vertical market standards, trends, current and emerging practices, and analysis of select applications within the following vertical markets:

  • Automotive/rail/transportation
  • Consumer electronics
  • Industrial automation
  • Medical devices
  • Military/aerospace
  • Mobile phones
  • Office/business automation
  • Retail automation
  • Telecom/datacom


Please contact us for more information.


Vertical Market Embedded Systems Market Statistics

VDC is preparing to launch research for a series of reports providing insight into the dynamics of different embedded vertical markets.  Reports will be published highlighting the following industries:

· Automotive/Rail/Transportation

· Consumer Electronics

· Industrial Automation/Energy/Power

· Medical

· Military/Aerospace

· Mobile phones

· Retail Automation/Digital Signage

· Telecom/Datacom

So what insights and statistics will be provided in these individual vertical market reports?

· Global number of embedded system project starts

· Global number and types of embedded system engineer

· Total Market for Embedded Software Engineering (TAM)

o    Total OEM Spend on Commercial Embedded Software and Tools

o    Total OEM Spend on Engineering Labor

· Statistics on engineering projects, technology use, solution selection, and developer preferences, among other factors

· Analysis of other leading business and technological trends affecting these industries

Please let us know if you have any questions on this research.  More information can be found here.


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Tool and Service Suppliers To Rebalance Their Offerings?

As the embedded markets emerge from the recession, we look for the shape and form of new revenue and profit opportunities. 


We see indications that some of the differences in technical requirement and commercial opportunity that differentiated (and insulated) the embedded markets from enterprise markets -- and the larger economy on some levels -- have been worn away by the latest recession. 


Indeed, the 'borders' of these markets have become quite porous during the past decade, with some transfer points created by the recession, and pre-existing others made wider by it. 


Each quarter brings another announcement of an enterprise vendor launching extended lifecycle support for one platform or another.


At the same time, embedded developer requirements for native, embedded 10G Ethernet, for example, highlights at least reduced resistance for, and more likely acceptance of, enterprise industry 'standards' for a broad range of capabilities. 


What does this mean for the business models of suppliers of embedded software platforms, tools and higher-level solutions?  We are not sure.  However, if the idea that broader requirements sets from the embedded markets are 'merging' with enterprise, we think it means some business model revisions may be required as well. 


Last week saw the release of a study of the broader outsourcing market that reported the vast, disparate community of companies offering technology outsourcing services, or products as services, would have a new name: External Service Providers.  And that this community would enjoy strong, stable, profitable growth opportunities for most of the next decade.


These companies would be offering hybrid combinations of standard service packages, customized services, traditional software products and products packaged as services (including SaaS and a host of Managed Services).


It all reads like a post-recession repositioning resulting from the re-aggregation of the IT services and communications industry, in the opinion of this reader.


But if we take this article as foundation for a future embedded market scenario, is it instructive?  And of what?


We met dozens of embedded software suppliers and services providers during our junket to Nuremberg.  Our teams exchange ideas with these companies daily.  What we know is a community of software companies that for more than a decade have been toiling -- driven by their own business models and by the demands of their clients -- to continue to explore productizing their capabilities and offer their clients' more powerful tools that they can deploy more independently.


Services remain a core part of the revenue profile of the most successful companies, but, the type of services migrated.  No longer was license maintenance the bulk of revenue for these companies.  In the eyes of the customer base -- the developers of the embedded systems -- services revenue migrated away from these pre-competitive, undifferentiated requirements, and moved up the value stack to enable developers to layer in more and better performance in their embedded devices. 


However, when the recession hit the embedded engineering community, and it did, they reacted with broad, swift, slashing strokes that eliminated perhaps billions of dollars in services contract fees for third-parties. 


Many projects were delayed.  Others scaled back.  Some cancelled.  And more than a few OEMs brought some of the outsourced services back 'in-house' in order to fill up some of their newly discovered excess capacity versus release talented developers. 


In response, a growing number of third-party embedded engineering service providers surveyed their proprietary toolboxes for marketable family jewels -- if you will.  After all, had the market not told the embedded tool service provider community that their preference was for much lower spending in attached services, tool products that they could operate more powerfully and with less dependence on fee-based support services from their tool suppliers?


What is a supplier of services to the embedded engineering community to do?  Invest in services capacity, for, as the enterprise market goes, and merges with at least the outer edges of the embedded market, so goes the larger embedded market?  Invest in productizing the most marketable and profit-potential proprietary methods and processes to meet, and perhaps accelerate the embedded market demand for software tool products?


It seems that the porous border between embedded and enterprise requirements definition can create as much potential for dissonance as for opportunity and profit. 


I think of the Slovenian firm, HERMES-Softlab, when I consider the implications for the community of companies that provide tool products and services to developers of embedded devices, systems and solutions. 


HERMES-Softlab has more than 1,000 developers, consultants and project managers.  The firm supports hundreds of projects annually.  Such was the strength of Hermes offering that the company's coverage area has grown far beyond its Balkan home markets to most regional markets between Russia and the Atlantic.  In fact, HERMES-Softlab business grew across the Atlantic as well. 


Until the recession, when third-party contracts came under the knife in the embedded markets. 


HERMES-Softlab responded with revised strategies that support two parallel approaches:

1.  Reinforcement for the primary value propositions of its core services:  proven time to market compression, 

cost reduction, design stability and client system performance

2.  Launch of a HERMES-Softlab-branded automated test tool suite, based on the accumulated experience and

intelligence of its 1,000+ organization of developers and managers


We like HERMES-Softlab's strategy, for it recognizes the duality of the new reality in the embedded markets.  As they emerge from what is clearly the worst economy since the inception of the 'embedded markets', software tool and service providers need to position themselves with products that continue to consolidate and automate lower-level, pre-competitive tasking, and higher-level services that enable embedded device suppliers to maximize their solution development capabilities and their return on assets. 


The embedded and enterprise markets may be merging and creating hybrid markets with blended product and service requirements from traditional embedded and enterprise markets.  Many in the tools and service supplier community may need to as well.


Total Market for Embedded Software Engineering Down in 2009 after a 4% Increase in 2008


VDC recently released a series of reports from Track 3: The Total Market for Embedded Software Engineering (TMESE) of VDC’s 2009 Embedded Software Market Intelligence Program. These reports include a total available market (TAM) analysis of OEM spending on embedded software engineering (including commercial products and software engineering labor spend).


Although growth slowed in the fourth quarter of 2008, many engineering organizations maintained their research and development spending rates throughout the majority of 2008.  The changing economic climate led to a more cautious development approach; whereas engineering staffs would have previously made more of the software purchasing decisions themselves, procurement has become more process-oriented and controlled by higher levels in the organizations.


The recession’s impact, however, became even more tangible in early 2009 as many OEMs began making significant cuts to their R+D budgets and engineering staffs as the potential magnitude and duration of the recession became more apparent.  With the total spend on embedded software engineering labor representing the vast majority of the overall TMESE as compared to expenditures on commercial embedded software solutions, the onset of project start delays and cancellations in 2008 had a significant effect on TMESE Labor spend in 2009 and will continue to impact overall embedded software market expenditures in 2010.


VDC explores the various trends impacting the Total Market for Embedded Software Engineering in greater depth within these four recently released reports:


  Volume 1: Global Embedded Software Engineer Census

§ Includes the global population of embedded engineers by type as well as segmentations of the total embedded engineer and embedded software engineer populations by region and by vertical market.

  Volume 2: Total Market for Embedded Software Engineering – Labor

§ Includes the total embedded engineering labor spend by Embedded Systems Manufacturers segmented by region and by vertical market.

  Volume 3: Total Market for Embedded Software Engineering – Commercial Products

§ Includes the total commercial products spend by Embedded Systems Manufacturers segmented by region and by vertical market.

  Volume 4: Total Market for Embedded Software Engineering – Aggregate

§ Includes the total aggregated spend by Embedded Systems Manufacturers on labor and commercial products segmented by region and by vertical market.


 All four volumes from the Track also include selected highlights from VDC’s Embedded System Engineering Survey Data as well as qualitative analysis of key trends affecting the topic under study in 2008, 2009, and beyond.


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?


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

Click here to register


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



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



Click here to register


Over $25 Billion: VDC Research Releases New Metric Measuring the Total Size of the Embedded Software Engineering Market

VDC Research recently released a series of Embedded Systems Market Statistics reports providing a detailed, vertical-by-vertical analysis of key embedded industries. Within these reports, VDC provides estimates for the Total Market for Embedded Software Engineering (TMESE), which VDC believes represents more than $25 billion worldwide.

While spending on commercial software and tools for embedded software engineering represents a large portion of the TMESE, spending on engineering labor continues to represent a substantial piece of this market opportunity. VDC views this larger market size to be most representative of the total revenue opportunity for software vendors. Vendors who provide solutions able to increase developer efficiency, improve time-to-market, and reduce labor costs can potentially capture a greater portion of the value of the engineering effort that the software they provide replaces. 

The TMESE “Iceberg”    

The TMESE calculation stems from recent upgrades to VDC’s Embedded Systems Market Statistics Model. This model also provides key metrics regarding the global engineering population and embedded projects, with an emphasis on vertically-, regionally-, and task-specific analysis.

“Leaders within the embedded industry are looking for more segment-specific intelligence to inform their assessments of current market opportunities and better align their offerings with customer requirements,” says Matt Volckmann, Senior Analyst and Program Manager, VDC’s Embedded Software and Tools practice. “VDC’s latest Embedded Systems Market Statistics model provides our customers with a more detailed view into the embedded software market as well as improved access to data specific to certain segments of interest across geographies, industries, and engineer types. The model also puts VDC clients in a better position to address key questions about the larger systems engineering industry.”

VDC reviews these and other critical statistics by vertical within the recently released Track 3 Embedded Systems Market Statistics reports, Volumes 1 through 7, from VDC’s 2008 Embedded Software Market Intelligence Service.


Now Available: Embedded Systems Market Statistics

Embedded Software 2008 Market Intelligence Service
Track 3: Embedded Systems Market Statistics

VDC Research Group is pleased to announce the release of seven reports on embedded systems market statistics, as part its 2008 Embedded Software Market Intelligence Service. The statistics are based on detailed Web survey responses from hundreds of embedded developers and VDC’s proprietary embedded systems market statistics model. This model is a tool for estimating and forecasting the global population of embedded engineers, the global number of project starts, and the Total Market for Embedded Software Engineering (TMESE). Each volume focuses on one of the following key vertical markets:

Volume 1: Automotive/Transportation
Volume 2: Consumer Electronics
Volume 3: Industrial Automation
Volume 4: Medical Devices
Volume 5: Military/Aerospace
Volume 6: Mobile Phones
Volume 7: Telecom/Datacom

Research Highlights

Through a combination of modeled estimates and end-user data analysis, each Embedded Systems Market Statistics volume includes but is not limited to the following information:

  • Demographics (Geographic region, primary role, type of product developed, and application type)
  • Key Industry Trends (General market and system engineering trends)
  • Project Statistics (Number of project starts worldwide, average per company, project length, time-to-market, cost of development, percent of cost attributed to software development)
  • Labor Statistics (Number of embedded systems engineers working for embedded systems manufacturers, distribution by engineer type, average number of engineers working on current development projects, average age and years developing embedded systems, annual salary)
  • Solution Statistics (Total spend on commercial embedded software solutions and percentage by product type, average umber of units shipped by company for 2007 and distribution by operating system type, average number of lines of code developed in-house, number of commercial/third-party lines of code, type of operating system used in current project, type of processor used in current design, use of key programming languages, as well as annual tools budget for software/system engineers)
  • Total Market for Embedded Software Engineering (Total spend on commercial products and embedded systems manufacturers labor)

Report Scope

These reports provide key embedded system engineering statistics for seven key vertical markets. These reports rely on information from VDC’s proprietary embedded systems market statistics model. This model is based on information gathered through VDC’s primary and secondary research and includes detailed analysis of our 2008 Embedded Systems Engineering survey.

To access the full version of this brochure as well as other information on these reports, click here.





With the increasing complexity of embedded software and hardware designs, the 2008 end-user data books will 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 February to April 2008 timeframe from almost eight hundred embedded systems engineers worldwide that will 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.

VDC’s Embedded Software 2008 Market Intelligence Service includes Track 1: Operating Systems Used in Embedded Systems and Track 2: Software/System Modeling and Test Tools.
Both tracks include a volume and multiple modules of end-user data for the individual reports within the tracks that includes data for over 130 exhibits for:

· Linux Used in Embedded Systems
· Windows Used in Embedded Systems
· Embedded/Real-time and Mobile Application Operating Systems
· Multi-Core Components and Tools
· Virtual System Prototyping/Simulation Tools for Software Development & Verification
· Software and Systems Modeling Tools
· Static Analysis Tools

Subscribers to individual reports from either Track 1 or Track 2 receive end-user data specific to any report purchased at no additional cost. However, the end-user data is available for purchase separately for subscribers requiring the data only as well as unique data cuts of specific interest to solution providers.

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 their solutions, developing competitive strategies, engineering products that better meet current and future customer requirements, and/or supporting key marketing and sales claims.

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.

For further information about VDC’s Embedded Software 2008 Market Intelligence Service contact:

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



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