Warren Savage On: Catching up with Hal Barbour
We continue to explore the changes in recent years in the semiconductor and IP industry in this third segment of my Industry Insider Interview Series. This week I sat down with Hal Barbour, President of CAST, Inc., to ‘take the temperature’ of semiconductor IP and pick his brain about some of the biggest issues facing the industry today.
Warren Savage: Hal, good to talk with you again. Can you give me a little background on yourself and how you got into the IP business?
Hal Barbour: I spent my first few years after college in radar circuit design, then fifteen years in sales and marketing for ATE, followed by about ten years in EDA marketing. From there, I moved to IP as the IP market began to open up in the late 1990’s.
WS: So, how would you rate the experience of working in IP versus other jobs you’ve held?
HB: IP is by far the most enjoyable. I’ve always felt that a market in its infancy or early growth phase is a lot more exciting than a more mature business. It’s an area where innovative ideas can flourish and intra-organizational politics are at a minimum.
WS: There has been tremendous consolidation of the IP market in recent years, with a number of the small and medium players getting gobbled up by the big guys. What does this tell us?
HB: It’s exactly the same pattern that occurs in most markets as they transition from embryonic to growth to maturity. It happened in ATE, then EDA, and now IP. However, IP is much broader than most other electronic design & production businesses. There’s an incredible range of IP businesses from digital (soft, firm, and hard IP), to mixed-signal, to analog, to software, to patent licensing. There’s also a growing area of architectural design consulting and solutions creation. This involves deciding what aspects of a system design are done in hardware vs. software, and integrating the consequential IP blocks to create the optimal solution.
WS: The tech media of today, at least in the US, seems to have drastically shrunk. Famous editors are now working for product companies. How do you get your message out to customers in such an environment?
HB: It’s true that the traditional electronic press has undergone incredible change, but what hasn’t changed is the huge appetite for information on the part of engineers, and their desire to get differing perspectives that impact their choices. That has given way to the rise of a variety of new sources, such as IP portals, blogs, social media, video, and web-based instruments such as webinars. Today, potential customers have far more efficient and effective information-harvesting tools at their fingertips than ever before, so it’s easier for the user to do the research than to rely on editorial experts. That puts the responsibility squarely on the shoulders of the marketing professionals to generate information of value rather than traditional “Marketing B.S.”
WS: What’s the biggest change you’ve seen in the market since the meltdown of late 2008?
HB: I think that customers are still more cautious than before the recession. But the primary difference has been the shift in funding away from semiconductor startups to less capital-intensive ventures, such as social media and mobile apps. I have talked to quite a few people that have really exciting systems ideas that would have been quickly funded before the crash, only to run in to a brick wall today.
WS: It wasn’t long ago that many IP companies were worried about licensing IP to China. Has that changed post-2008?
HB: While it’s still an issue, it’s far less of an obstacle today than in the past. Semiconductor design IP has some immunity from piracy due to the fact that the IP is only as good as the expertise and support behind it, and the downstream cost of design errors is truly punitive in terms of respin costs. Most responsible companies are not willing take the risk of saving the relatively small cost of IP at the potential expense of astronomically higher respin costs that can result from unsupported or illegally licensed IP. China is a huge growth market and IP providers know that. Some may attempt to add protection via encryption or other means but, at the end of the day, China is a huge growth market and an IP company ignores it at their own peril.
WS: Let’s bring out our crystal ball for a moment. What you predict will be the biggest, most disruptive change in semiconductors in the next three years?
HB: Crystal balls are always tough. In my opinion, ‘infinity’ in this business is only a year to 18 months out. Trying to see out three years is nearly impossible. It’s not only a matter of technological opportunity, but perhaps more difficult is the judgment of how quickly human beings will adopt entirely new concepts.
My guess is that disruptions are more likely to occur as semiconductors play the key enabling role in addressing the global problems such as energy, healthcare, human longevity, and other issues that impact people’s lives worldwide.
WS: It seems like there just aren’t any hot new startups anymore, while even industry titans are merging, as we saw with Texas Instruments’ recent acquisition of National Semiconductor. Are you apprehensive about such consolidations in the semiconductor industry?
HB: Consolidations or not, they still require IP and IP-intensive systems solutions. Semiconductors are not going away. Perhaps the landscape will change to emphasize lower-power and more configurable devices so that the number of ASIC design starts will continue to decline. But these devices will still require systems-level solutions to address market opportunities.
WS: What woul d be your recommendations for new EE grads coming into the semiconductor world today?
HB: First, they should endeavor to understand the full range of electronic system composition: from analog to digital design, from hardware vs. software optimization, and from design, to test, to production. It needs to start with a thorough understanding of the problem to be solved.
Quite a few years ago, I had the pleasure of discussing this topic with Bernie Gordon, founder and former President of Analogic. He told me that it depressed him, when interviewing employment candidates, to hear one claim to be a digital engineer, or an analog engineer, or a software engineer, etc. In Bernie’s words, “It takes a lifetime to become an engineer, and it’s a complete cop-out to look at oneself in a narrowly-defined discipline of the engineering spectrum. You’re not really an engineer until you understand the full range of system engineering.”
WS: Before we go: three words that you would use to describe the semiconductor industry today.
HB: Exciting, boundless, and crazy—as in, “still crazy after all these years.”
WS: Thanks very much for your insight, Hal, always a pleasure.
About Hal Barbour, President, CAST, Inc.
Hal earned a BSEE and worked several years as a circuit designer before moving on to technical sales and marketing positions with GenRad, Intergraph, and HHB Systems (later acquired by Racal-Redac). Witnessing both stunning successes and colossal managerial failures, he has applied those lessons to leading semiconductor intellectual property provider CAST, Inc. over the past thirteen years. Pioneering a successful virtual and distributed organization model and using a lean, customer-oriented operations philosophy, Hal has helped CAST succeed and thrive in a volatile and challenging market.