Understanding monetization of applications with 3rd-party IP cores
In addition to ready-to-use applications, the Accelize Distribution Platform enables monetization of IP cores. An Independent Software Vendor (ISV) can thus license an IP core from a 3rd-party IP Vendor (IPV). The IPV will then be compensated through a royalty of each sale of the application that contains its IP core.
This post explains how this works in the Accelize Distribution Platform.
The IP Vendor distributes its IP core protected with its own DRM Activator. The IP core is packaged as encrypted HDL, and optionally packaged as a .xo object for VITIS integration.
The ISV creates a new Product in the Vendor Portal, and specifies the presence of a “3rd-party IP”, along with its internal protected IPs. The DRM HDK can now be downloaded. The DRM Controller will contain additional ports for each 3rd-party IP.
3rd-party IP usage is compensated through a royalty model, i.e. a revenue sharing scheme. IPV and ISV thus negotiate a percentage of the application revenue that will be allocated to the IPV. For example, an IPV could receive 20% of the revenue generated by the application that embedds the IPV IP core.
IPV then submits the Marketplace Reseller Authorization Form to Accelize. This form specifies the IPV IP identifier, the ISV application identifier, and the royalty percentage
ISV simply instantiate the 3rd-party IP into its design, and connects the DRM port of the IP to the additional port of the DRM Controller. This is particularly easy to do in VITIS, with .xo package for IP cores, and scripted DRM connections in the top-level file. ISV can then compile and deploy the application.
Here is an illustrated real-life example of the V-NOVA P+ application that contains the HEVC HD Encoder IP from Xilinx (formerly NGCodec).
For each sale of the ISV application that contains a 3rd-party IP core, the Accelize platform will automatically collect the 3rd-party IP royalty amount and credit the IPV account.
Technically, this is implemented as a contemporaneous sale from IPV to ISV. Like any other sale, it is subject to taxes, payment processing fee and Accelize fee. The Accelize platform uses Stripe – the world leading payment service provider – to process all transactions. The following diagram shows the money flow from the Customer to the ISV and the IPV.
The application license contains the sub-license for the 3rd-party application, that was automatically generated on behalf of the IPV. This is entirely transparent to the end-user.
As an IP Vendor, it is extremely easy to monetize securely your IP cores. Once protected with the Accelize DRM, you simply need to deliver them to your ISV customers. From there, you revenue will automatically flow into your bank account. No need for expensive and painful license agreement negotiation – compliant usage of your IP is 100% enforced by the Accelize DRM platform.
As an ISV, it is extremely simple to license a 3rd-party IP core, with zero upfront cost, zero legal cost and zero risk. You will only pay for the IP when you actually generate revenue from the application that contains these 3rd-party IPs.
At Accelize, we’re proud to offer a win-win, secured, and automated IP flow for IP Vendors and Application Developers.