( ESNUG 519 Item 5 ) -------------------------------------------- [02/14/13]
Subject: Gary and Shawn school Brett on up-front vs ratable ESL sales models
> In Gary Smith's latest Market Share 2012 report, Forte is #1 for 2011 ESL
> synthesis.
>
> 2011 ESL Synthesis Market: $28.2 million total
>
> Forte Cynthesizer #################### $10.1 (36%)
> Mentor Catapult C #################### $9.9 (35%)
> BlueSpec ############# $6.5 (23%)
> SNPS Synphony (Synfora) ## $1.7 (6%)
> Cadence C-to-Silicon $0.0 (0%)
>
> See that? Forte was 20% in 2008; now we're 36% -- and at 1st place! CatC
> was 51% in 2008; now it's down to 35% -- and Catapult C fell to 2nd place!
>
> Allow me to gloat! The reality is that now we are both counting revenue
> using the SAME REVENUE MODEL and, had Catapult been using that model years
> ago, they'd have done a lot less bragging.
>
> And, we would have been recognized as #1 long ago.
>
> - [ Brett Cline of Forte DS ]
> http://www.deepchip.com/items/0516-01.html
From: [ Shawn McCloud of Calypto ]
Hi John,
Pushing the Brett entertainment aside, I'd like to set the record straight
and emphasize the facts.
In 2011, when Catapult merged with Calypto, we began the process of changing
our Catapult sales revenue model from up-front to ratable. Everyone who has
done this understands when you move from an up-front revenue recognition
model to a ratable business model that revenue is understated for a few
years while the multi-year contracts unwind. The effect is that revenue
drops, just like it did for Synopsys in July 2004.
Calypto is coming off its biggest year ever with 2 of its largest quarters
in history as well as the largest bookings year ever. Calypto currently has
over 120 unique customers including 12 of the top 15 semiconductor companies
by revenue. We added 14 new accounts in 2012 some of which are the largest,
most notable brands in consumer electronics today.
- Shawn McCloud
Calypto Design Systems San Jose, CA
P.S. And for RTL power optimization, our PowerPro marketshare last year
went from 8% to 21% according to Gary Smith. This market had a 28%
CAGR over 3 years making it one of the fastest growing segments in EDA.
---- ---- ---- ---- ---- ---- ----
From: [ Gary Smith of GSEDA ]
Hi, John,
As Calypto used a ratable system of accounting, and Mentor takes a sizable
amount of the revenue up front, there will be a 3 year period in which to
reconcile the differences. So Forte has 2 more years to take advantage
of the accountant's gift. It will be interesting to see who is #1 in 2015.
- Gary Smith
Gary Smith EDA Santa Clara, CA
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