EXECUTIVE PREDICTS DEMAND FOR "SHRINK-WRAPPED" EDA SOFTWARE MAY LEAD TO
INDUSTRY SHOWDOWN

IRVINE, Calif. -- In two years, the computer industry will face a
significant shakeout between vendors providing software for PC-based
platforms, according to Peter Sundquist, Vice President of Marketing and
Sales, MicroSim Corporation, a leader in Windows Electronic Design
Automation (EDA) software.

"After that overall industry showdown, the electronic design automation
marketplace will face its own demons," he said. "The vast majority of EDA
companies -- including both PC-based and UNIX-based workstation software
vendors -- will find themselves, by sheer necessity, going back to the
drawing board to define a whole new way of doing business."

Sundquist predicts the market trend will be towards marketing
"shrink-wrapped" Windows EDA software "running right out of the box" like
best-selling Windows software targeted for the office or home user. In the
future, designers will expect software manufacturers to provide them with
'shrink-wrapped' packages that are easy to install, learn and use.

"Costly EDA technical support may become a thing of the past," said
Sundquist. "Engineers will count on easy-to-use standard software
solutions, with intuitive graphical interfaces and comprehensive on-line
help to get them up and running. They'll benefit from the lower prices
resulting from higher volumes in the marketplace."

"That trend creates gray clouds over the large UNIX-based suppliers today
-- such as Mentor Graphics, Cadence, and ViewLogic," he said. "If a
company decides to change gears, it can't afford to sell a low-priced
Windows product through the same sales channel as its high-end solution."

Selling a lower-priced shrink-wrapped product could also mean charging
customers for consulting and integration services just to stay profitable.
As a result, a UNIX-based EDA company may have to redefine itself as a
"value-added" consulting and service organization.

According to Sundquist, these manufacturers will have to sell EDA software
at higher prices in order to pay for their expensive sales forces.
MicroSim has been able to keep prices down by selling its family of
products directly to customers rather than relying on a costly sales
force. MicroSim uses Value Added Resellers in the U.S. and internationally
to provide local service, on-site support, training, consulting and local
sales support.

"The survivors of tomorrow must do some fast thinking today," said
Sundquist. "MicroSim still stands on the solid foundation built with
MicroSim PSpice, our flagship simulation product, yet we recognize that
keeping in step with an evolving industry means taking a new look at our
position in the marketplace."

An important step in MicroSim's new strategic direction is the company's
recent expansion into the schematic capture and printed circuit board
(PCB) design markets with the introduction of three high-end software
packages, MicroSim Schematics, MicroSim PCBoards and MicroSim PCBoards
with Autorouter for Windows, priced up to 90 percent less than the
competition.

The company now offers a family of powerful, integrated products for
schematic entry, PCB design, signal integrity analysis, mixed analog and
digital simulation, PLD synthesis with logic simulation, and analog
performance optimization.

"As we make our entry into the PCB design market, we recognize there will
be a consolidation in the market for PCB design products in the same way
that there was a consolidation for products made for UNIX-based
workstations several years ago," said Sundquist.

"In the UNIX workstation model, vendors that could not provide a family of
integrated tools went away or were purchased. In hindsight, it's clear
that customers ended up having a strong preference for a single vendor
providing a seamless set of products that work together. With that
historical perspective, MicroSim will be entering new markets with the
goal to become an EDA supplier of all types of Windows EDA software."

According to Sundquist, diversification into new markets, like schematic
capture and PCB design, does not mean "me too" low-end products. "We spent
many lab hours developing high-end Windows schematic capture and PCB
packages as our first offering in a new market," he said. "Although it
would have been simpler, we wanted to make a big splash and didn't feel a
low-end PCB and schematic product would do the job. Our objective was to
offer high-end shrink-wrapped packages for Windows integrated with our
other software, and to sell them at dramatically low introductory
prices."

"This is not a normal introductory offer," said Sundquist. "In an effort to
penetrate the new PCB and schematic capture markets rapidly, we will hold
to introductory prices until we achieve significant market share," he
said.

MicroSim introduced its flagship product, MicroSim PSpice for analog
simulation, in 1985 as the first SPICE-based program for IBM-PC
compatibles. The product is so widely used that many corporations and
universities refer to MicroSim "PSpice" in place of the generic "SPICE"
(Simulation Program With Integrated Circuit Emphasis), developed at the
University of California, Berkeley. Founded in 1984, the company continues
to invest heavily in simulation products for Windows, Sun, HP, and DOS
while making new R&D investments in other EDA software products for
Windows.

"We see our role as providing a complete, integrated family of
shrink-wrapped products for the Windows environment that will simplify the
engineer's day-to-day tasks and buying decisions," said Sundquist. "As the
EDA industry evolves in the 1990s, MicroSim must keep up with a very
discerning customer who will look for software products sold by companies
offering shrink-wrapped solutions and value-added services."

MicroSim Corp
714-770-3022

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