How is the current business climate in semiconductor manufacturing affecting the software segment?
LaChapelle: The most significant weather element, of course, is that we are still in the grips of a downturn, and it appears that in 2003, there will not be significant improvement to warrant added capacity in the fab. The resulting economic factors are driving chip producers to control costs by consolidating organizations where possible, creating a business priority domino affect across the industry. The industry continues spending money on software solutions, but their focus is changing. There is growing pressure to optimize manufacturing processes and reduce headcount, while maintaining core competencies. Process optimization software development is not typically a core competency for the majority of semiconductor manufacturers. It is a context activity necessary to guarantee their operations generate as many good die as possible. This focus shift to core activities has opened a significant opportunity for merchant software suppliers to fill the gap. Historically, IDMs, test houses
