The Linley Group Reports Processor IP Shipments to Double By 2012

CPU IP Shipments Surpass 5 Billion as Handsets Drive Rapid Growth

MOUNTAIN VIEW, CA—February 27, 2009—Highlighting the processor intellectual property (IP) market as a growth opportunity for the semiconductor industry, The Linley Group today noted that chip designers will continue to reduce cost and time-to-market by purchasing third-party IP instead of developing the technology in-house and forecasts the market will more than double by 2012. An in-depth analysis of the IP processor market, trends, and key players can be found in the firm’s latest report, "A Guide to CPU Cores and Processor IP." The report provides both a quantitative and qualitative study of CPU, DSP, and graphics (GPU) IP.

"Next-generation handsets and other digital systems are using multiple processors per device, driving market growth," said Joseph Byrne, senior analyst at The Linley Group and coauthor of the report. "Still, IP companies will be under pressure to sign new licenses and generate royalty income in order to sustain their costly design teams. Our report analyzes current market conditions and product offerings, describing the strengths and weaknesses of numerous companies and providing our opinions on which companies are in the best position to capitalize on anticipated market growth."

According to the report, handsets remain the largest target application for IP processor cores, as increases in functionality drive demand for multiple processors per device. For example, the Apple iPhone and other smartphones require multiple CPUs, DSPs, and a GPU to implement the complex capabilities of the device. Advanced handsets typically implement one CPU for the user interface and applications, and another for communications. Similarly, separate DSPs may perform audio multimedia processing and communications. Finally, a GPU is essential for processing 3D and vector-graphics images, providing slick user interfaces, gaming capability, and the high-resolution displays needed for GPS navigation and full-featured web browsing.

Another high-growth segment is home-electronics applications, including Blu-ray players, set-top boxes, and digital picture frames, which will create demand for processor IP to support high-definition audio and multimedia, advanced user interfaces, and Internet connectivity. Other markets spurring processor-IP shipments include Flash storage, hard drives, media players, smart cards, and microcontrollers.

Comprising the vast majority of the market, CPU core shipments reached 5.3 billion in 2008 and are expected to double by 2012. DSP and GPU IP ship in much smaller volumes, but shipments are growing quickly. DSP shipments will grow at a compound annual rate of 20 percent through 2013, and GPU shipments in that timeframe will grow at a staggering 60 percent per year.

As the leading supplier of CPU IP, ARM dominates the market and is expected to increase its position. Smaller players ARC and Tensilica offer customized solutions that should enable them to carve out niches. MIPS is well established and reaps among the highest royalties per core in the industry. The company uniquely offers a multithreaded CPU core and a CPU rated in excess of 1GHz. Ceva, the leading supplier of DSP IP, has secured many high-profile design wins, and this success should continue into a new generation of products as OEMs strive to maintain backward compatibility between 2G, 3G, and 4G designs. Pursuing audio and wireless-baseband designs, Ceva faces VeriSilicon, whose ZSP DSP has also gained wins in these areas. Early to market, Imagination Technologies is by far the leading supplier of GPU IP but now confronts CPU-leader ARM and upstart Vivante.

Availability

"A Guide to CPU Cores and Processor IP: Focusing on CPU, DSP, and GPU IP, First Edition" is currently available directly from The Linley Group and is priced at $2,995 for a single-user license. For further details, visit the web site.

About The Linley Group

The Linley Group, the leading provider of independent technology analysis on semiconductors for networking, mobile applications, and wireless communications, provides in-depth technology reports, strategic consulting, and interactive seminars. Watch for details of the Linley Tech Processor Conference to be held September 16 - 17 in San Jose.