Have you ever heard an assertion that's so intriguing and farsighted that it sticks in your mind over a period of years; even decades? Imagine that the given thought is so resonant, that whenever a related innovation appears the idea is instantly recalled as if you were just talking about it. For me, one such notion is the "paperback computer" -- a computing device so cheap that it's as physically inconsequential as a common paperback book.
The most recent event triggering this memory was the release of the "EDA360" vision paper, where in a flash it was clear to me that this document is an official declaration that the paperback computer's time is near. In short, the manifesto describes the variety of transformative changes that will be required for the EDA industry to meet the emerging challenges of such "apps driven" devices. Allow me to connect some dots between EDA360 and this dynamic area of the consumer electronic space, using the concrete example of a paperback computer as the context. (Relax, this isn't going to be another veiled glorification of the iPad.)
This idea of a paperback computer was planted in my brain by the seminal 1992 PBS series "The Machine That Changed the World" (yes, *that* 1992 - when in order get an *ARPAnet* account you needed to be an EE student, or know someone). The series was a comprehensive documentary about the history of computing and information science, as well as some impressively accurate predictions of computing's future. Specifically, Episode 3, literally titled "The Paperback Computer", opens with a tour of a historic "chained library", where the books -- both handwritten by monks, and mechanically printed by "gen 1" printing presses -- are literally chained to the shelves to prevent theft.
The narrator goes on to state, "[at the time] the idea that regular citizens would own books was ludicrous." Pausing for a second to let the viewer chortle in self-congratulation that they already owned a Macintosh, IBM PC XT, or Amiga, the scene shifted to a contemporary university library where all the computers were chained to the desks to prevent them from walking away. The point was well made: while in 1992 computers had become personal, they were still expensive enough that it they still needed to be locked down.
Fast forward 18 years to the present day, and the vision of the paperback computer is clearly much closer to becoming reality. The many low cost netbooks, the resurgence of the tablet computer category, and the emergence of complementary/supporting secure cloud computing infrastructure are all evidence that we're getting close.
Specifically, machines at the low end of the market like the promised OLPC tablet -- or similar, commercially-oriented devices -- will be available for sale for a retail price of $100 within the next 18 months to 2 years. (Note: I'm deliberately ignoring "free with subscription" mobile devices. Of course they are not free in reality, since the device cost can be readily recovered with subscription revenue. Furthermore, for many reasons this business model is fading; hence my belief that it's safe to exclude them from consideration here.) Clearly the pressure on keeping the cost of goods sold (COGS) to a minimum is acute, leaving massive sales volumes as the only path to profitability.
So how does all this relate to the EDA360 vision paper? First, consider the following EDA360 observations:
- "Most of the newcomers [to established markets] are focusing their innovation and differentiation on ‘apps'".
- "Many of the newcomers are outsourcing hardware design. In addition, they are increasingly dependent on semiconductor providers to supply portions of the software stack, such as diagnostics, drivers, operating system (OS), and middleware. What they are demanding, in effect, are application-ready platforms with hardware and software for a given application."
- "System-on-chip (SoC) development costs at the upcoming 32nm process node will approach $100 million. ... To be profitable and to amortize this $100 million investment, a semiconductor company may need to ship 80 million units. Considering that Apple had shipped a little more than 40 million units of the iPhone by the end of 2009, 80 million units is a huge target."
- "If electronic design is only available to a handful of creators who can only make money by shipping 80 million units, few of these devices will be built and the diversity that consumers want will not materialize."
- "Some innovators will redefine themselves as integrators. They will integrate at the silicon, SoC, and system levels. They will make heavy use of externally designed silicon and software intellectual property, they will tend to stay at mature process nodes, and they will invest heavily in embedded software development. They will become application-focused platform providers, not ‘chip' providers."
- "Integrators want hardware that is ‘good enough' to serve application needs, but their biggest concerns are quality, cost, and time to market."
Working backwards through this list, several EDA360 -- paperback computer connections jump right out:
- As long as the desired apps are supportable; "good enough" hardware is OK
- Differentiation will be mostly through content and user experience, and not really from hardware.
- Depending on the COGS many millions, even billions, of units will be required for profitability
- Smooth integration of existing IP will be key to creating the desired apps platform
To be sure, there are a lot of caveats and exceptions behind this list of connections. For an example from recent consumer electronics history, one could argue the innovative addition of embedded 3 axis accelerometer hardware - and the unique apps it enabled -- has been a huge differentiator to the iPhone's market share gains vs. competitors that bet on higher resolution cameras with video capabilities. That said, if you buy into the central EDA360 assertion that it's primarily the apps that are in the value driver's seat, the integrator surely seems to have the upper hand versus the underlying hardware creator.
Adding up all of the above, consider some near term implications for the EDA industry in the paperback computer context:
1 - I believe verification will be the key to integrators' success - much more than people suspect. In my experience in verification -- as both an integrator myself, and as an observer of 100s of customer projects- - I've long since lost count of the number of times bugs turned up in "known good" or "production proven IP" when they were repurposed and integrated into new systems (I recall a specific case where Specman found a bug in IP that was in production use for 5 years, across several projects). From the end-users' perspective, the quality expectations for a $100 MSRP device will be low, but they won't be insignificant. In fact, I assert that a bug free user experience will be a major differentiator of such products.
2 - We [the EDA industry] need to avoid the temptation to over compensate for past sins of under-supporting integrators by over investing in this area. We can't drop the ball supporting the creators.
3 - Recalling a point John Bruggeman made in a recent video blog on the iPad launch, the main money making parties here are the "toll collectors." Apple collecting "tolls" via iTunes app, music, and video sales; and the carriers selling data plans. While there have been many, many attempts by the EDA industry to capture royalties on the devices we help create (most recently, "gain sharing" here at Cadence), I dare say we [EDA] need to rethink how we can get in on this action. I'm not suggesting this will be easy. To pull it off, it might require the formation of a 70s-style business conglomeration (recall the success of Harold Geneen forming ITT into a multi-faceted, $17 billion entity); or something along the lines of Cisco's evolutionary path from networking equipment producer to also becoming a provider of bandwidth consuming gear. (Truly this is the subject of several blog posts, at least. Interested?)
I'm curious to hear what memories and insights EDA360 and this post have triggered. Do you see the same trends, and reach similar conclusions? What's your company's EDA360 strategy? What would you like to see in a modern remake of "The Machine That Changed the World"? Please comment below, or catch up with me at the Sunday June 13 EDAC forum, at the Cadence booth 1334, Hall B from June 14-16, or at the Embedded SOC Enablement Day on Thursday June 17.
Joe Hupcey III
On Twitter: @jhupcey -- http://twitter.com/jhupcey
P.S. To put a finer point on it: a central premise of the paperback computer concept is that the device is so cheap that you don't care if it gets lost. (Assume for the moment all the data you care about is safe inside some secure cloud computing area; and thus only the loss of physical device itself is at issue.) Even though the OLPC tablet and inevitable knockoffs are being targeted for a retail price of $100, I'd still rather avoid losing $100, thank you. And even today, when you accidently forget your "free" a/k/a subsidized mobile phone on a plane/train/bar it's not the same pain free experience as leaving behind a $9.99 MSRP paperback book. So what is the ultimate COGS target for a $9.99, "I don't care if it gets lost" paperback computer? A cursory internet search of vanity publishers turned up the following: for a mere 10,000 units of a self-published, standard 288 page 5.5"x 8.5" paperback book, with a single color laminated cover, costs around $1 per unit. Yikes -- creators and integrators sure have their work cut out for them!