Boyz (& Girlz) N the Hood
*************** Let's admit it openly. The EDA Neighborhood is one tough Barrio and you gotta have some real street-cred to survive in this place. You gotta have Hutzpah to survive in this Hood. You gotta have Moxie to survive on these Mean Streets. Actually for a while, we thought things were getting uncomfortably gentrified around here. Senior executives at some companies were seen cruising around town in late model mercedes, lexi, jaguars, or even a rolls or two - complete with drivers. And if you'd been checking out the on-line financials for these Moguls of (ds)Microns, you'd probably have found out that most of them were pulling down 6, maybe 7 figures - even during our beloved, recent, nasty, nuclear-winter, high-tech melt-down. On top of that, these guys - these Denizens of Design - were openly selling their perky little stock options right and left, reeling in a couple hundred thou here, a cool mil or two there. It was unbelievable. Literally. But thank goodness, we've put a stop to all of that nonsense and returned to our roots. We're a Tough Neighborhood once again, the grit and grime a welcome relief to all of that posturing and sashaying around. I'm mean, who wants to live as if there's no end in sight to shrinking geometries or upwardly mobile roadmaps. That just ain't real and the folks in the EDA Neighborhood are nothing, if not real. Really. So what brought us back to our senses? What made us sit up and stare reality in the face? What made the EDA Neighborhood a Bad-Apple Town once again? It's pretty simple. Synopsys laid an egg - a big one - right in the middle of the road where nobody could ignore it and everybody had step around it, or worse yet - step in it. Yep, they laid an egg. They had promised $1.4 bil or $1.3 or $1.2, but changed that promise to $900 mil or so instead. Their stock sank 32% in a single trading session, the rest of the EDA Neighborhood got creamed on the news, and tongues went a-wagging up and down The Street faster than you can say 186,000 miles per second. And the funny thing is? The very day that Synopsys shares were the most actively traded issue churning around on the Nasdaq, the Guys from Google - those Darlings of the Dutch Auction, those Princes of the Power-to-the-People Perspecti - were wowing folks by spinning gold out of hay, by making 85 look like 100 just after making 135 look like 85. What a wild and wacky way for Synopsys and Google to pass like ships in the night. One headed south. One headed north. At least, that's my version of the bloodbath that unfolded in our little neighborhood last week - the tongues wagging, the grit and grime hitting the fan, the Hood getting down and dirty, the people getting real, the hype halting, the thrill of victory (for the clique from Stanford) serving as foil to the agony of defeat (for the clique on the wrong side of the Technology Tracks). Yeah, the EDA Neighborhood's a tough neighborhood once again. Now an unhappy week has passed since that ugly Synopsys earnings call on August 18th, and it's not clear where we go from here. Do we revel in our wretchedness or rally to live another day? I actually thought for a while that I could get an answer to these questions if I could talk to The Man himself, the one at the center of this maelstrom - Synopsys CEO Aart de Geus. So I tried to get him on the phone. In vain. Now it's true that as neighborhoods go, I'm hardly the Big Guy on the Block. Others would undoubtedly have had better success gaining access to one of the Pillars of our Population, but oh well. I gave it my best shot. Probably better to have tried and failed than to never have tried at all. And what would I have asked the good doctor if I had been allowed access? I would have asked him if he felt that Our Neighborhood, positioned as it is in the larger world of software, was any tougher than anybody else's neighborhood. And if so, why? I would have asked him if a company that has something just shy of 100% market share could really afford to not live up to its promises from an earnings point of view. I also would have asked him if he felt that any company should ever be expected to always go up, up, up and never be allowed to go up, then down, then up, then up, then down, then up, then down, then down, then up, then up - you get the idea - just like People and Neighborhoods. I would have asked him if he agrees that Synopsys is a company made up of people - some of them being good spouses, parents, children, siblings, employees, and citizens of this world. Some of them, no doubt, not being all they could or should be. I would have asked him if he agrees that Cadence is made up of several thousands of people who are also mostly good, but sometimes flawed - and Magma and Mentor and Verisity and Monterey, and so on and so forth. I would have asked him if the people who are laboring away at these companies should give up now because the environment in this Neighborhood - economic and technical - has become so tough, so gritty, grimy, and dilapidated that nobody wants to live here any more. Then I would have gotten really personal and asked him how much a 32% single-day decline in the value of a share of Synopsys stock decreased his own personal net worth. If he would now be unable to pay his mortgage or feed his children. Or if anyone else in the EDA Neighborhood would be destroyed financially as a result of the tanking of EDA stocks on August 19th. Then I would have told him about my daughter. The one who's en route right now to Kenya where she's going to spend the next 3 months setting up a library with the 25,000 books that she and her friends have arranged to have delivered there by way of Books for Africa - a delivery completely paid for out of their hard earned dollars and hard earned donations from people in their neighborhood in their world in Seattle. I would have told him that she has arranged to pay $50 a month for her room and board to a family in the village where she will be living while she and her friends work to assemble several libraries in the area ... $50 because that's the going rate to feed and house an individual in that neighborhood, and $50 is probably on the high side. I would have asked him if the tongue-wagging, gasping, selfish, spoiled, well-heeled, over-paid, over-fed, over-educated technologists, analysts, investors, executives, engineers, and employees of software companies, hardware companies, banks, investment houses, and magazines would know the words starvation, illiteracy, malaria, polio, yellow fever, dysentery, tuberculosis, or small pox even if they were smeared as graffiti on the walls of the prissy "tough" Neighborhood of EDA. I would have asked him if he who dies with the most toys wins. And you know what? I think Aart de Geus would have been willing and able to engage in this conversation. I think he's intelligent enough to have been able to understand the irony in all of this. I think he can see the bigger picture just as well as the rest of his neighbors here on EDA Ave. Yeah, it's a Tough Neighborhood these days. It's Hell in the Hood. As it turns out, however, a lot of neighborhoods are tough these days - it's just a matter of degree. Won't you be my neighbor?
Peggy Aycinena owns and operates EDA Confidential. She can be reached at peggy@aycinena.com
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