Concurrent Posts Loss - Bullish on SW Business

Concurrent has been emphasizing is software offerings recently:

• Reseller dealer withNovell to jointly sell and support Concurrent Real-Time Extensions Powered By SUSE Linux, a specialized Linux offering based on Novell's popular SUSE Linux operating system. (Jan 2006)
• Nighthawk development tools released to merchant market (Nov 2005)
• Several design wins for RedHawk RT Linux (2005/2006)

On software in the Q2 06 release:

Additionally, we achieved higher overall gross margins partly due to our continued evolution to a software company. These operating results combined with the anticipated growth of both the video-on-demand business and our real-time operating system business indicate improving results in calendar 2006. Our enthusiasm is due to the huge growth in content availability for VOD, the success of near network DVR applications like "Start Over," and our recent announcement of a partnership with Novell to sell our real-time Linux operating system on the SUSE Linux release. Our real-time Linux operating system continues to gain momentum as the best high performance operating system in the market. We anticipate growing revenues in the coming quarters which, coupled with sound fundamentals, should tend toward positive results."

The financial info is below


ATLANTA, Georgia, January 27, 2006 - Concurrent (Nasdaq: CCUR), a worldwide leader of on-demand and real-time computing technology, today announced its results for the second quarter of fiscal year 2006.

In the second quarter of fiscal 2006, consolidated revenue for the company aggregated $18.9 million compared to $16.2 million in the first quarter of fiscal 2006, an increase of 16.3%. Revenue from Concurrent's on-demand product line totaled $9.8 million for the second quarter of fiscal 2006 compared to $7.3 million in the first quarter of fiscal 2006, an increase of 33.7%. Revenue from the company's real-time product line totaled $9.1 million for the second quarter of fiscal 2006 compared to $8.9 million in the first quarter of fiscal 2006, an increase of 2.1%. Cash at the end of the second quarter of fiscal 2006 totaled $17.0 million, a decrease of $0.4 million from the prior quarter.

The net loss for the second quarter of fiscal 2006 was $1.6 million, or a loss of $0.02 per fully diluted share, compared to a net loss of $2.2 million, or a loss of $0.03 per fully diluted share, in the first quarter of fiscal 2006.

FSMLabs adds ARINC Support

Does FSMLabs have the most complete Embedded Linux solution package for a company that is not a household/industry name? Wind River and MontaVista get most of the press (here too!), but FSMLabs continues to innovate and expand its offerings. The release has a full list.

We would not count on this product in safety critical apps. FSMLabs has had a great deal of success in test bench applications for the aerospace market. This appears to support those efforts.

FSMLabs has the product line, but lacks the market presence and awareness that other companies have invested in with venture-backed capital. We believe the company has largely bootstrapped itself over the years and while this conservative approach has a number of benefits, it is difficult to achieve the market presence of a MontaVista that way. That said, the problems that MontaVista appears to have are only compounded by investors with high-return expectations. Maybe the folks in Socorro have a better plan?

The release is here:

Socorro, NM - January 23, 2006 - FSMLabs, (http://www.fsmlabs.com) today announced ARINC 653 scheduling is now available in RTLinuxPro. Designed for avionics control and advanced hardware-in-loop simulation, ARINC 653 provides a fully protected and partitioned scheduling environment configured using a standard XML format. The ARINC scheduler has been added to FSMLabs' industry leading PSDD user space real-time product for executing real-time threads in the address space of Linux or BSD processes.

Richard Bond, who developed an RTLinuxPro based simulator in his work as Principal Real-Time Specialist for Lockheed-Martin, says:
"RTLinuxPro and PSDD enabled a simple simulation framework, allowed me the choice to develop user-level I/O drivers, and provided outstanding performance. ARINC 653 support will make this tool even more useful.”

PSDD is especially well suited to large scale simulation and test applications.
Dean Anneser, a Software Engineering Fellow at Pratt & Whitney says:
"PSDD provides a very cost effective scalable multiplatform solution (x86/ppc) for our simulation, control, and data acquisition systems.”

The ARINC 653 specification requires both time and space (memory) partitioning and also calls for XML scheduling configuration. FSMLabs has coupled these standard configuration, scheduling and protection mechanisms with RTCore's POSIX compliant OS interface. ARINC users get the benefits of specific scheduling windows, easy configuration, and application isolation, plus POSIX threads, semaphores, shared memory and other standard interfaces. The system supports, “C,” C++, and FORTRAN. ADA support is planned.

Modern off the shelf processors can perform at many times the capacity of previous generation special purpose systems so ARINC 653 “cabinets” can share processors or multiprocessors with standard PSDD and RTCore real-time threads and ordinary Linux processes. For example, databases and graphical visualization systems can run in left-over time.

RTCore's built-in SMP support is inherited by the ARINC 653 subsystem. Multiple ARINC “cabinets” can be run on a single system, reducing management overhead, cost, space, and power requirements. Where the computing requirements of the ARINC partitions is exceptionally high, RTLinux's processor control and reservation technology allows system architects the option of running only real-time code on selected processors.

The PSDD component already supported time and space partitioning, but FSMLabs has now added an option to PSDD for ARINC 653 required limitations on interaction between partitions. The FSMLabs implementation provides user-defined timing windows for specific partitions enabling users to create multi-threaded simulation compartments that are bound to specific periods of time within a cycle. Threads within a partition are dependent on their priority level within that compartment and are completely independent of other ARINC threads at any other priorities that may run during other time-slices.

FSMLabs'ARINC 653 support comes as an option to the RTLinuxPro development kit, which provides all of the tools needed to build hard real-time applications out of the box, including:

• A full set of compilers, libraries, and build tools, plus debugger
  
• The RTCore real-time server and a ruggedized embedded Linux kernel
  
• An Eclipse based IDE
  
• A small embedded target file system
  
• Carrier Grade Linux as an option
  
• Full FSMLabs state-of-the-art testing and quality assurance
  

Availability:
RTLinuxPro and ARINC 653 support are available immediately from FSMLabs and its worldwide channel partners. For a complete list of supported hardware, contact FSMLabs.

Cyclades(?) acquired by Avocent

What does a console and KVM acquisition story have to do with embedded software? Other than the products containing embedded software, not much it would seem. However, Cyclades was an early and outspoken supporter of embedded Linux. Cyclades was also an early MontaVista customer.

The company has even put a Penguin/Linux logo on its products.

Mentor Q4 Results - ATI Highlights

Mentor Graphics finished 2005 on high note, posting record revenue of $221.3 million for Q4.

During the corporate presentation the Embedded Systems Division (ATI) was mentioned twice:

1. The operations in Mobile were disrupted by the hurricanes that hit the Gulf States.
   
2. Embedded systems customer count more than tripled in Q4.

Not much here, but encouraging news for a strong industry close for 2005.

Arrow, LynuxWorks, RTI, Motorola, Intel and Dot21 Partner on OA

This announcement came out yesterday from Arrow. Almost missed it.

Arrow Electronics Partners with Technology Suppliers to Deliver Open Architecture Solution to U.S. Armed Services

ENGLEWOOD, Colo.--(BUSINESS WIRE)----Arrow OEM Computing Solutions, the division of the North American Components (NAC) group of Arrow Electronics, Inc. ( ARW) that provides design engineering, manufacturing, system integration, supply chain management and post-manufacturing services to industrial OEMs and intellectual property-based companies, today announced it has partnered with Dot21, Intel, LynuxWorks, Motorola and RTI to deliver a new open architecture solution to the U.S. Armed Services.

The bundled hardware and software solution, called "OA Out of the Box," will offer the military and other government agencies a standard platform for developing open architecture-based solutions. This platform can serve as the foundation for any type of OA application and will enable designers to speed time to market and prevent them from having to conduct a complete re-design each time they begin a new development.

To create the solution, Intel and Motorola are contributing COTS-based (commercial off the shelf) open hardware components, such as computer blades, in a multitude of physical and mechanical configurations; RTI is providing the readily accepted middleware that enables different technologies to communicate; LynuxWorks is providing a POSIX-based open operating system; and Dot 21 is conducting performance testing. By relying on open architecture in systems such as the Navy's Ship Self Defense System and the Army's Future Combat Systems, the military is able to reduce costs, quickly deploy new solutions and facilitate the rapid exchange of information between soldiers, weapons, sensors and command platforms.

"As a distributor and integration partner, Arrow is in a unique position to bring together the offerings of its top suppliers to create comprehensive solutions such as 'OA Out of the Box,'" said Steve Ramsland, vice president and general manager, Arrow OEM Computing Solutions. "What's more, Arrow is bringing its logistics and integration expertise to the 'OA Out of the Box' solution, inventorying and ensuring the quality of each component and protecting against obsolescence by managing the supply chain."

Some good articles out this morning

There are a number of good articles about the challenges of innovation, technology and change in the papers today.

In the Financial Times there is an article on Kodak: "Kodak's focus on blueprint for the digital age" (You need to be subscriber or pick up a hardcopy)

Also in today's FT: "Brutal pace of innovation makes incumbents sweat"

FT also has a special section on India and Globalization.
In the Wall Street Journal on the front page is an article on Lockheed's struggles with its spy plane contract. Lockheed has seen the new face of military procurement and it is ugly. The article is: "Airborne Incident: As It Adapts to Information Age, Lockheed Fumbles Key Project"

Telelogic Q4 Results

Highlights (VDC comments in parentheses):

• Revenue $51 Million (converted using Q4 average exchange rate)
• Tau (UML tool) 18% of Revenues or $9.2 Million ($7.2M in Q4 2004)
• Tau G2 sales increased by 17%, G1 sales declined (to be expected)
• DOORS 44%, Synergy 23%
• System Architect 11% (acquired through Popkin acquisition cost $45M)
• Focal Point 4% (decision making application for product development)
• Earnings per share up 12%

VDC's View: This is a very solid quarter for Telelogic. We focus most of our efforts on Tau and the company's design automation tools, which are showing strength here - up $2M compared to Q4 2004. Most interesting in this announcement is the number of customers mentioned who are licensing multiple Telelogic products in multi-year agreements. Not only does this give a strong indication of future growth, but also shows the success of the company's acquisition strategy around DOORS and Synergy, although DOORS is the more successful product by far.

Sounds like DA Davidson Thinks WIND will hit its number

DA Davidson initiated coverage on Wind River today with a BUY. Remember Wind's fiscal year end is January. Seems like they have good feeling on this.

Say what you want about DSO but a number of analysts have initiated coverage on WIND in the past couple of months. Where were they when WIND was just in the "embedded" business?
Equity analysts who have started covering WIND since October 2005:

DA Davidson
AG Edwards
WR Hambrecht
Soleil
Citigroup
Prudential

New Senate Bill to support US Competitiveness

Some senators are taking notice and have sponsored a bill to address ongoing US competitiveness concerns. Could mean core technology research grants for vendors and researchers in the ESW world. Get in the line for the handouts.

The release is here. We will take a look at the legislation and report back.

VDC Smart Fabrics Research

Smart Fabric and Interactive Textile (SFIT): OEM and End-User Requirements, Preferences, and Solutions Analysis is VDC's second publication assessing the global SFIT market.

Report Highlights
The global market for electrically enabled SFIT technologies reached $304.0 million in 2005, and is expected to grow to $642.1 million by 2008, a compound annual growth rate (CAGR) of 28.3%.

According to OEMs, commercial prices were the largest inhibitors of SFIT growth. Some other barriers included: high costs of materials, slow funding/development, and poor OEM education and demand. Other comments included: the need to produce more effective washable form factors, and the need to educate end users of SFIT products and their functions.

At present the SFIT marketplace for electrically enabled applications only exhibits true competition in a few isolated instances where technical maturity has somewhat evolved.

Today the majority of the market rests in the automotive industry, however the electronics communication and entertainment devices segments hold the most competition. Reasons why this type of involvement has not spread to other industries include:
- Limited competition spread throughout different end-user markets.
- Required high levels of cooperation among SFIT supplier stakeholders to facilitate portfolios encompassing different industries and technologies.

RTI Offers Small Footprint NDDS Middleware

Although most of the success for the Data Distribution Service (DDS) middleware standard and RTI's NDDS product have been in the military/aerospace market it seems they are finding acceptance in a number of other markets as well, including industrial automation. The company has a number of customers in the IA market including:

Schneider Electric
Schilling Robotics
Max Planck Institute
Nikon

RTI was previously famous for its scope tools line which it sold to Wind River in order to focus on its NDDS middleware product.

From the release:

In an iterative and collaborative development effort with an industrial automation giant, the networkingexperts at Real-Time Innovations (RTI) have created a modified version ofRTI's NDDS real-time publish-subscribe communication middleware that can be used in low-cost, memory-constrained applications.

This new implementationof NDDS, which requires less than 100 kilobytes of memory, is currently deployed in a line of programmable logic controllers (PLCs). Because the standard version of NDDS can be used in high-end PLCs, developers can now deploy a common communication scheme across industrialcontrol networks that contains a full range of PLC cost and functionalityoptions

Standard RTI NDDS Developer Package is immediately available starting at$46,920 USD for a three-user perpetual license. Packages include NDDSmiddleware, NDDS tools and one year of support.

Stallman in eWeek

You can get a more serious look at GPL 3 from a number of sources including Linux Devices.

Here are some of the more enteraining parts of Richard Stallman in eWeek on GPL 3:

eWEEK Senior Editor Peter Galli: You said the main issues for you were making the license more easily compatible with other free licenses, as well as DRM (Digital Rights Management) and the whole patent issue. Tell me your thoughts on these issues.

Richard Stallman: DRM is an attempt to crush the freedom that copyright law gives the public. It is completely evil. DRM does not deserve to be tolerated and should be wiped out. It is tolerated because governments are not very democratic and the rich have too much power over governments and the media.

Another entry:

Galli: So, is the process now in the hands of the community?

Stallman: No. I will still be making decisions. The committees are going to take all the comments and boil them down to issues. Then they will start addressing the issues and looking at the various options. They will also try and decide how to deal with these issues, but ultimately I will be making those decisions. And, of course, if the community has found a good solution, they make that job easy.

One more:

Is Microsoft the greatest threat to freedom in software?

It is a mistake to think of the free software movement as an alternative to Microsoft. When we started this, Microsoft was not particularly important. In 1984, the system that people normally thought of as the system to compete with was Unix. That is why we have GNU's Not Unix: It couldn't be GNU's Not Windows because there was no Microsoft Windows then.

Microsoft is simply one example of a proprietary software developer, a software developer that tries to subjugate users to keep them divided and helpless. So what we are campaigning against, and trying to help people escape, is not any company in particular, but an antisocial system where software developers put restrictions on the users.

Worried about the state of US engineering?

Here is the session for at ESC San Jose:

Engineering Humanity Panel
Thursday, April 610:00am - 11:00am
Moderated by Brian Fuller, Editor-in-Chief, EE Times

It's under most Americans' radar, but technical education has become a silent crisis in America. The future of the nation's innovative culture is under stress as countries such as India and China graduate two to three times as many engineers. EE Times Editor-in-Chief Brian Fuller brings together a panel of educators and business leaders to frame the problem and offer solutions.

Seems like CMP editors are undecided about the situation. See Jim Turley's counterpoint here.

Bus and Boards Conference

VDC analyst Eric Gulliksen was out at the Bus & Board conference this week and has returned with a few pieces of information.

• Conference attendance seemed to be down a bit this year.
• The cell processor from IBM/Sony/Toshiba caused a stir. However vendors are unsure of the chips impact on the broad market. Mercury is offering what is calls the first rugged cell-based board product.
• RoHS compliance was a key theme. Not just on the conference schedule, but in vendor meetings as well.
• 2006 looks to be the year of RoHS compliance and vendors are concerned about the amount of effort that will be required...and more concerned about not complying.
• It is not just lead, but cadmium and other metals that are raising concerns. Cadmium, for instance, is used in the dye for some wire jacket insulation.
• One vendor commented that just changing a line SKU number can take as much as 30 man hours of work. That does not include the engineering or validation. Just the paperwork, updates to market materials and product documentation, etc. Some vendors have over 1 million SKUs.
• Bottom line: In 2006 the embedded boards vendors are going to be swamped with compliance activities. This could hurt innovation, new product development and other business activities.

More on RoHS from Wikepedia:

The Restriction of Hazardous Substances Directive (RoHS) 2002/95/EC was adopted in February 2003 by the European Union. The RoHS directive takes effect on July 1, 2006, but is not a law; it is simply a directive. This directive restricts the use of six hazardous materials in the manufacture of various types of electronic and electrical equipment. It is closely linked with the Waste Electrical and Electronic Equipment Directive (WEEE) 2002/96/EC which sets collection, recycling and recovery targets for electrical goods and is part of a legislative initiative to solve the problem of huge amounts of toxic e-waste.Each European Union member state will adopt its own enforcement and implementation policies using the directive as a guide. Therefore, there could be as many different versions of the law as there are states in the EU.

RoHS is often referred to as the "lead-free" directive, but it restricts the use of the following 6 substances:

• Lead
• Mercury
• Cadmium
• Chromium VI (Also known as hexavalent chromium)
• PBB
• PBDE

PBB and PBDE are flame retardants used in some plastics.The maximum concentrations are 0.1% (except for Cadmium which is limited to 0.01%) by weight of homogeneous material. This means that the limits do not apply to the weight of the finished product, or even to a component, but to any single substance that could (theoretically) be separated mechanically — for example, the sheath on a cable or the tinning on a component lead.

As an example, a radio comprises a case, screws, washers, a circuit board, speakers etc. A circuit board comprises a bare PCB, ICs, resistors, switches etc. A switch comprises a case, a lever, a spring, contacts, pins etc. The contact might comprise a copper strip with a surface coating.Everything that can be identified as a different material must meet the limit.
So if it turns out that the switch's contact coating was gold with 2300 ppm cadmium then the entire radio would fail the requirements of the directive.

Encirq adds VP and GM

Encirq has added an executive to spearhead North American operations. The company hopes to mirror the success of a similar strategy that it implemented in Japan.

Some select information from the release is below:

ENCIRQ Corporation today announced the appointment of Dylan Kennedy as Vice President and General Manager, Americas. Kennedy will be responsible for building out field operations to help ENCIRQ’s customers accelerate the delivery of innovative new products.

He joins ENCIRQ from NextHop Technologies, where he was Vice President of North American Sales. He previously held senior management positions at a number of the industry’s leading software companies including Western Regional Sales Director for Wind River Systems (Nasdaq: WIND) and UK Country Manager for Integrated Systems, Inc.

Linux FUD from the BSD Camp

BSD supplier Wasabi Systems is offering a new take on Linux FUD (fear, uncertainty and doubt) this time it is Sarbanes-Oxley compliance.

The gist is this:

Effectively, executives are lying to their shareholders if they do not disclose, or do not know, that the company doesn’t have a valid license for software it is claiming as an
owned asset. Unlike a mere GPL violation, this misrepresentation is a crime, and carries
criminal penalties.

Wasabi's conclusions include the following:

The Sarbanes-Oxley Act radically changes the risk portfolio for companies using Linux as a
development platform. Violations of the Linux license, and even the common practice of
leaving GPL compliance to engineers, are, we believe, violations of federal law. Companies
thus face the choice of complying fully with the GPL (despite the loss of intelectual property
and the intrusiveness of legal review), risking federal sanction, or seeking alternatives to
embedded Linux (which may include proprietary systems, or open source products governed
by different licenses, such as the BSD license). Violating the GPL, for public companies and
those which seek to become public, is now a federal crime.

Wasabi has another White Paper out there on this topic and it has this interesting paragraph:

The real problem here is that the GPL was created by the Free Software Foundation with an
ideological, not a commercial, aim in mind. Is it any surprise that a proprietary software company runs into legal issues when it uses the license of the "Free Software Foundation"?

and this line as well,

Unless embedded Linux users are content to release all their code, they are wise to look for insurance.

Or use BSD perhaps?

We are not sure how much fire is here with this line of attack but the documents are worth a look.

Microsoft is Touting Real Time Capabilities of CE

We don't know if you have seen the add that Microsoft is running in recent issues of EE Times and perhaps other places, but it is worth a look. It features an R&D manager from Chaveriat Robotique and one of their robotic arms that runs CE. The quote from the R&D manager is "We chose Windows CE because it offers real-time and graphics at the right price."

In addition there is an article we saw yesterday on eetimes.com on real time and CE 4.2.

Also, a November 2005 article entitled "Windows CE 5.0 for real-time systems" appearing in Embedded Computing Design. The author was Mike Hall one of Microsoft's technical point people for Windows Embedded.

Interestingly, a quick google search on Win CE unrelated to this article produced a Microsoft ad on the side. The first keyword in the ad was "RTOS"

This might be trend to keep an eye on. It seems like the most activity directed at touting Windows CE real-time capabilities since the 3.0 release when the company was using supporting materials from Siemens.

Windows CE is in a wide variety of devices. Probably a more varied collection than most industry observers would give them credit for supporting. Many don't have the Windows logo, some are headless and some would even be the types of devices that traditional RTOS players would like to be in. Microsoft will be in increasing competition with the traditional OS players in key markets like automotive, consumer devices and industrial automation.

More new products Trolltech

We don't want this to be a collection of new product announcements but we will try and highlight some of the more important ones like this one from Trolltech.

Trolltech is a key enabler of Linux, especially in mobile phones. The company has a major presence in Asia, with China likely being its top market. No surprise really given the strength of Linux in the mobile handset market there.

This product update would typically support devices other than handsets, but demonstrates the product range from desktops to traditional embedded devices to mobile devices. Part of the release is inserted below:

Qtopia Core: Development Platform for Single-Application Products
Qtopia Core as a stand-alone technology is a robust, customizable development platform for creating single-application devices powered by embedded Linux. Designed for high value applications, it includes a comprehensive set of libraries and graphical tools to help organizations quickly and cost-effectively create embedded Linux-based products.

Qtopia Core supports the same APIs as Qt 4 – bringing the benefits of Trolltech’s proven desktop software to developers of a broad range of embedded Linux equipment. It includes all the latest Qt features such as extended support for heavy-duty graphics, more internationalization with right to left text, and better tools for highly productive development.

Qtopia Core customers will also reap the benefits of Qt’s worldwide developer community.

Trolltech plans to expand the Qtopia 4 Series in the coming months to address a broader range of embedded Linux opportunities. Anticipated products in the Series will include:

Qtopia Platform: Qtopia Core with application management and user interface capabilities, enabling embedded Linux development for consumer electronics and other advanced, multi-application products.

Qtopia Profiles: Qtopia Platform with key enablers for embedded Linux development aimed at specific vertical markets.

Qtopia Editions: Solutions aimed at targeted product segments.

The Qtopia Series today features Qtopia Core 4, Qtopia Phone Edition and Qtopia PDA Edition

New Products from GHS and MG/ATI

Two new products announced today:

Green Hills Software, Inc., today announced the immediate availability of a complete port of its INTEGRITY real-time operating system to the BAE Systems’ RAD750 radiation hardened PowerPC Processor and CompactPCI single board computer.
The RAD750 is a licensed radiation hardened version of the IBM PowerPC 750 and is the follow-on to BAE System’s RAD6000 family. The RAD750 architecture supports 260 MIPS operating at 132 MHz.

Accelerated Technology, a MentorGraphics division, today announced the availability of the Nucleus Cipher Accelerator software, a plug-in to the Nucleus Cipher Suite that adds support for hardware encryption acceleration. The software allows designers to boost the performance of their security applications, resulting in increased data throughput and lower processor utilization. The Nucleus Cipher Accelerator initially supports the Freescale Semiconductor ColdFire MCF5235, MCF5271, MCF5275, MCF547x, MCF548x and PowerPC MPC8272 processors.

More on US competitiveness

Two articles appeared over the last couple of days on US competitiveness. The first reports a speech by former Speaker of House Newt Gingrich and the second is Jim Turley throwing a cold bucket of water on the whole lack of engineers in the US argument. See the On Target: Embedded Systems posts from last month on this topic. I have included Newt’s recommendations below.

Like most of the recommendations from politicians it reminds me of the Monty Python sketch called "How to do it." Which goes something like this:

"But first, here's Jackie to tell you all how to rid the world of all known diseases."
"Well, first of all, become a doctor and discover a marvelous cure for something, so there'll never be any diseases ever again."
"Thanks, Jackie. Great idea."

Anyway there are recommendations from an embedded.com article, the first couple are even possible to implement:

• Create a system of civil justice to reduce the burden of lawsuits and give incentives to young people to go into professions other than the law.
• Dramatically simplify the tax code to favor savings, entrepreneurship, investment and constant modernization of equipment and technology.
• Make math and science learning equal to any in the world and educate enough young Americans in science to enable the United States to compete successfully with other well-educated societies.
• Invest in the potential scientific breakthroughs in energy, space and the environment.
• Create, via high tech, "a 21st century intelligent health system" that would improve the health of the populace while dramatically lowering health care costs and making American health care a value export and source of revenue.

These recommendations are applicable to any country thinking about is place in the World during the second half or so of this century.

More on EL

Did you know that Express Logic owns rtos.com?

Just and aside.

Express Logic Signs Datang Mobile to License

This release came through the email box last week.

RTOS supplier Express Logic has signed Datang Mobile to a license for ThreadX. VDC believes that this is a Datang phone or reference design. In addition, the companies are also negotiating for Datang to bundle and distribute ThreadX with a mobile phone SoC. ThreadX will support the RF capabilities of the phone/chip.

While this is not Express Logic's first handset deal, it may be its most important. Datang has the potential to be a prime mover behind TD-SCDMA (Time Division - Synchronous Code Division Multiple Access), the Chinese developed 3G protocol, and having ThreadX bundled in could be an important win for the San Diego-based Express Logic.

RTOS support for RF communications on handsets has largely been based on in-house OSs with commercial vendors like, Mentor Graphic/ATI and ENEA also capturing a large part of the market.
ThreadX was probably appealing to Datang for its small footprint, reliability and royalty-free business model. For SoC vendors, not adding on high prices for bundled software or eating a portion of the software bill of material themselves makes their products more competitive and enhances the bottom line.

Ousourcing Trends: Software Development

Outsourced manufacturing is the most common type of third party service used in the development/production of embedded devices. However, the use of third party services in the hardware and software development process isn't far behind.

Research from VDC's recently published Market Statistics report indicates that in the case of outsourced manufacturing, the goal tends to be to reduce costs. However, with hardware and software development, it is more often the demand for additional development resources or the need for assistance in an area that is outside a development team's core competence that drives the demand for third party services.

High percentage of embedded projects still run behind schedule

The latest findings from VDC's 2005 Volume VIII: Embedded Systems Market Statistics report, show that nearly 40% of embedded development projects run behind schedule. In fact, over 80% of the projects running behind schedule are at least 2 months late.


While the percentage of late projects is substantial, it's an improvement from previous years in which VDC research has indicated that a majority of projects were running late. The medical, military/aerospace, and industrial automation industries had the highest percentage of late projects, while the retail automation and consumer electronics markets had fewer late projects on average.

VDC Proprietary Operating Systems Report Highlights

Some interesting information from VDC’s recently completed 2005 Embedded Software Strategic Market Intellegence Program - Volume VII: Proprietary Operating Systems:

VDC’s developer survey found that 37.1% of the respondents use a non-commercial OS as part of their device development. This represents an ongoing migration for this population of developers, from 43.1% in 2001. The development and use of non-commercial OSs is a result of an era when developers had a lot of restrictions that included expensive hardware and limited and expensive memory.

Developers cite various reasons for the continued use of non-commercial OSs ranging from technical specifications to development and production costs. Considering these issues, some developers just do not see a compelling reason to adopt a commercial OS solution. It may be that the additional features offered by a commercial OS are just not required and don’t outweigh the additional resources (i.e., memory, etc.) that would need to be included or would exact performance penalties. In many cases, the needs of their application are extremely specific and the use of a non-commercial OS gives developers the ability to customize their environment to match their exact needs.

As customers demand smarter, more controllable devices, developers will look to increase software functionality. Adding new features to products increases the complexity of non-commercial OS software. Non-commercial OS users will look to switch to commercial OSs where this added functionality is available and allow developers to concentrate on their core competencies of developing discriminating features that will be attractive to the end user, rather than on software technologies that are transparent to the end user.

VDC expects the population of developers using a non-commercial OS – either proprietary or no formal OS – will decline in the future as networking, increasingly complex software, and advancing hardware will require commercial OSs. However, VDC expects the use of open source/free operating systems as a migration path to increase as technologies such as Linux mature and where there is already a growing interest by embedded software developers for its use.

For more information on the changes at MontaVista

LinuxDevices has done some additional reporting on the shake up at MontaVista (see our post below). Check it out here.

MontaVista Shake Up

There has been a shake up at MontaVista with some executive resignations in the mix.

The changes include Senior Vice President, Strategic Operations Kelly Herrell resigning.

A number of other managers are leaving the company as well, although the resignations are not thought to be related.

VDC Market Stats Report Highlights

VDC's Market Statistics Report was published recently. Here is an interesting chart (one of many) in the report. The data is on scale of 1-5 with 1 being not important and 5 being very important.

What we find of note here is how far down on the list Price/cost is. Tools rank very high as they do in the processor purchasing decision. But the highest rated requirement is Reliability/stability.

Security is way down the list. Amazing with all the emphasis on secure systems. VDC is betting that security becomes a key feature in 2006.

Click here for more information on the report and the brochure.

WIND Up Today

WIND is up big today on the Nasdaq. This could signal the start of a run up before the company's fiscal year end and earnings announcement.
We pulled this from breifing.com for those of you who are into technical analysis:

12:22PM Wind River - - Relative Strength (WIND) 15.24 +0.56 : The stock displays RS as it stages a breakout above its 15.00/ 15.13 resistance area to a fresh 4-month high. Next area of interest lies near the upper end of its late-August bearish gap at 15.70.

The VCs See Something in Savaje

Mobile Java OS company Savaje raised another $40 million in December 2005. We thought we had seen this release before, so we did a bit of checking. Near as we can tell this is the Savaje funding history:

1999-2003 $12M
2003 $17.5M
2004 $40M
2005 $40M

Total $109.5 M

That is a lot of money for a product entering a maturing mobile OS market with lots of competition. The company is on version 2.5 of the OS and to date has not one deployed product. Good Sense PDA is expected to release the first handset shortly and LG has shown a Savaje powered phone.

My point here is not to stick it to Savaje. Just to point out that the VCs must see something here. Perhaps it is the potential for Savaje to be another Symbian. Remember how long it took that company to gain any momentum?

In 2004, the last year of data VDC has collected, Symbian did $114 million. In the first half of 2005 Symbian shipped more phones than in all of 2004. Also in the first half of last year the installed base of Symbian phones 39 million units. Of course, Symbian has Nokia.

Mapusoft OS Support

We get updates from Mapusoft on their products which automate the porting of application software to alternative OSs. Here are the current OSs supported. This might indicate demand for porting from various OSs and demand for porting to various OSs. Perhaps we are reading to much into the product support lists. But here they are:

Currently, OS Changer solutions are available for:

Porting from pSOS and VxWorks to: Nucleus PLUS, Precise/MQX, ThreadX, Linux, LynxOS, Solaris, eCOS, uITRON, Windows CE, and Windows Embedded XP.

Porting from Nucleus to: Linux, LynxOS, eCOS, Windows CE, Windows Embedded XP.

We also offer OS Changer solutions to port POSIX code to various target operating systems. Please contact us to find out supported POSIX APIs and target operating systems.

ATI

Accelerated Technology, the embedded software arm of Mentor Graphics (Nasdaq: MENT) had two announcements this morning. It is interesting to look at them together.

The first announces support for the PictBridge standard, from the Camera & Imaging Products Association (CIPA) - this provides technology that allows direct print capabilities from a digital camera to a printer.

The second is that Beatnik's mobileBAE software now supports the Nucleus PLUS RTOS.

ATI is extending its support for multimedia and mobile/handheld devices by further integrating third party standards and technology. ATI is a strong player in the consumer electronics field where its royalty free, small footprint RTOS fits well with the market requirements (high volume, tight margins).

ATI continues to build out its support for the various types of devices that we broadly call consumer electronics. VDC expects ATI to continue its strategy of adding value to its core RTOS product offering through the integration of third party technology thereby capturing some of the revenue that developers previously invested in doing the integration themselves.

5 Things we are Looking for in 2006

The Battle for the Soul of DSO
DSO hit the streets a couple of years ago. Wind River said that they only gave the concept a name, “Device Software Optimization,” and that the underlying principles were already in the marketplace. Several vendors have taken Wind River up on its offer to define a new market most-notably Green Hills and ENEA. Each of these vendors adopted a definition of DSO that best fit with their offering and industry positioning. There has been some backlash by Wind River -most importantly in CMO John Bruggeman’s blog where he has struck out at both GHS and ENEA. Our bet is that it shakes out in 2006 or vendors will get tired of the whole thing and leave DSO to Wind River.

Security
Everyone is concerned about security, but our surveys indicate that very few developers are actually using security protocols in their devices. This will change in 2006. Suppliers of embedded and real-time operating systems will provide greater and easier access to security components in their platform offerings and security vendors will be much more prominent in the marketplace.

RT Java (again)
This is like going back to the future. We think we have written this one before. But seriously it will happen this time. Well, it should happen this time, especially in the military market where much of the work is being done. Growth in this market will be driven by the US Military’s commitment to open architectures, and the evolving improvements in Java real-time support through both the Real Time Specification for Java (Java Community Process RTSJ) and subsets for providing real-time, safety-critical, and mission-critical support from suppliers in programs such as the Navy Open Architecture Computing Environment (NOACE), the Army’s Future Combat Systems, and the joint DARPA, Air Force, and Navy Joint Unmanned Combat Air Systems (J-UCAS).

Consolidation
VDC expects 2-3 major acquisitions in 2006. The operating system and broad line suppliers of embedded tools and components will be the targets.

The VDC Blog
In 2006 VDC’s Web log will be the first real-time news and analysis source for the industry. It will be the best way to spend the first couple of minutes of your day.

Is Linux a Cult?

I was catching up on my DVR viewing over the long weekend and caught an episode of Frontline on PBS called “The Persuaders.” In it, the CEO of Saatchi and Saatchi talks about certain brands that are "lovemarks" - a brand for which the consumer has "loyalty beyond reason." He likens these to cults and in trying to understand consumer behavior around these brands undertakes a study of cults including in one scene: Linux Users.

Although that is a funny aside...this program should be viewed by anyone who is responsible for convincing others to buy products.