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22 The PCB Design Magazine • December 2016 for your buck. Today, the PCB design process entails much more than just schematic capture and PCB layout. With increasing complexity in electronics systems, engineers need to develop with the whole product in mind. Having access to a design tool that encompasses PCB design, coupled with comprehensive simulation and analysis, really gives design engineers the con- fidence that their products will be delivered on schedule and at the highest performance and reliability. Also, as electronics becomes smaller, faster and more densely packed, engineers are compelled to consider virtual prototyping to meet stringent schedules. Small and medium enterprise (SME) com- panies now dominate the EDA market and as the number of global customers builds, the pric- es of the technology drop as it can be spread across the larger user base. Over the years, the cost of ownership has dropped from ~$100,000 to ~$15,000 per seat with even more advanced features. This is no doubt great for the custom- er, but not so for the EDA company and their global reseller network. From a salesperson's point of view, they now have to put in a similar amount of effort for far less reward. Price competition in the EDA industry is in- tense, which can lead to price reductions, lon- ger selling cycles, lower product margins, loss of market share, and additional working capital re- quirements. If competitors offer significant dis- counts on certain products, then other vendors may need to lower their prices or offer other fa- vorable terms to compete successfully. Any broad-based changes in pricing policies could cause new license and service revenues to decline or be delayed as the sales force imple- ments these changes and the customers adjust to the new pricing policies. Some of the compet- itors may bundle certain software or hardware products with other more desirable products at lower prices or no marginal cost for promotion- al purposes as a long-term pricing strategy, or engage in predatory pricing. EDA vendors promote their products and services through advertising, marketing auto- mation, trade shows, public relations and the internet. They generally market their products and provide services to existing and prospective customers through a direct sales force consist- ing of sales people and applications engineers. They also selectively utilize value-added resell- ers to broaden their reach (especially interna- tionally) and reduce cost of sales. At the enterprise level, where huge profits can still be realized, months of sales and engi- MARKETING IN THE MATURING EDA INDUSTRY Figure 2: Technology adoption life cycle (source:Crossing the Chasm).