Gartner defines semiconductor IP as pre-designed blocks of circuits for use in making complete semiconductor devices. Its definition of the semiconductor IP market only includes revenue from IP sold on the open market. Captive IP, which is IP-designed and used by one organisation alone, is excluded.

'The semiconductor IP industry has matured considerably during the past five years,' says Christian Heidarson, senior research analyst for Gartner's semiconductor group. 'However, the next five years will bring major challenges to business models, as demand for IP shifts from standard functions to more complex specifications.'

IP re-use will become even more important to chip design going forward. By boosting the productivity of design teams, IP re-use fuels one of the main trends in the chip industry: device integration. Moore's law will still apply in 2010, so IP re-use will be crucial if chip makers are to achieve the large-gate-count chips required by future electronic products.