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By Scollag
September 21, 2006

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A couple of years ago, we were all sniffing around to see what we thought of the proposed Artisan acquisition. I dug up one of the periodic articles about the silicon IP business from a couple of years before, which was one of the few places I could remember reading about Artisan.

This was the article:

http://www.edn.com/index.asp?layout=article&articleid=CA200288&partner=enews&pubdate=3/11/2002

And this was my review of how the companies mentioned in the analysis had fared since publication:

http://boards.fool.com/Message.asp?mid=21207779

I thought it might be worth looking again at some comparative revenue data, since we have two more years' available now.

I was particularly impressed back then by Artisan's unmatched record of continuing growth, considering the state of the industry over that period.

Company         2001        2001       2002       2003
($M)         (Cahners)    (actual)
ARM            149.6       152.3      177.0      170.0  
Rambus         107.3                   97.4      118.2
MIPS            70.2        69.9       43.1       40.3 
Parthus (Ceva)  40.9        67.5       19.2       36.8
Virage          34.8                   47.5       40.0
Artisan         27.8                   43.7       74.6
DSP Group       26.6                   ----       ----
Synopsys        24.4        64.6       61.2       76.4
inSilicon       19.9                   ----       ----
ARC             13.5        11.5       11.7       10.7 


Well, to make a long story short, I have added a couple of columns, dropped DSP Group and inSilicon for reasons mentioned two years ago, and used actual data, rather than Cahners', where possible.

Figures are $M, for each calendar year, converted where necessary using rates applicable to each year. ARM's figures are for combined PD license fees and PD royalties only. Artisan's data are for PIPD, as provided by ARM since the takeover. Synopsys' (IP division) data are out of phase, and are for the year ending Oct 31. The companies listed are taken from the 2002 Cahners' study.

            2001      2002       2003      2004      2005       4-yr
                                                                CAGR %
ARM (PD)    152.3      177       170       212       255.1      13.8
Rambus      107.3      97.4      118.2     144.9     157.2      10.0
MIPS         69.9      43.1       40.3      56.9      59.4      -4.0
Parthus/Ceva 67.5      19.2       36.8      32.3      30.7     -17.9
Virage       34.8      47.5       40        58        51.3      10.2
Artisan/PIPD 27.8      43.7       74.6      83.5      91.1      34.5
Synopsys     64.6      61.2       76.4      65.6      69.4       1.8
ARC          11.5      11.7       10.7      18.7      15.8       8.3 


As ever, I recommend that these data are viewed graphically.

Of course, simple revenue figures can conceal some complexities and trade-offs in license fees and royalties, but overall I think these are surprisingly favorable to ARM. Artisan/PIPD has healthily overtaken Synopsys, Ceva, MIPS, and, most importantly, Virage Logic.

My main concern is that we need to see continued growth from PIPD, but I am cautiously pleased by the upturn in licensing last quarter for both PIPD and PD.

PS

As I was about to post this, I happened to notice the link from the old thread provided by DoubleTops on RB, and found this very recent article which covers much the same ground, albeit on a shorter-term basis and covering a slightly different set of companies, for historical reasons. Registration is required, but probably worthwhile, I think:

http://www10.edacafe.com/nbc/articles/view_article.php?section=Commentary&articleid=295570

Note that this article also provide access to a number of previous discussions.

Cheers,
Scollag.


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