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KEYLOCK-2 Project FUSE Demonstrator Document Rif.: FDD01B.doc Pag. 1 FUSE DEMONSTRATOR DOCUMENT No: 24566 Company: TECNOCAD s.r.l. Title: ‘Keylock-2’ - An Electronic Key for Software Protection is improved by FPGA technology allowing new features. TTN: CRR Review Date: 15-10-98

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Page 1: FUSE DEMONSTRATOR DOCUMENTKEYLOCK-2 Project FUSE Demonstrator Document Rif.: FDD01B.doc Pag. 3 Abstract TECNOCAD is an Italian company (founded in 1988, turnover 500 KECU) with 3 persons

KEYLOCK-2 Project FUSE Demonstrator Document

Rif.: FDD01B.doc Pag. 1

FUSE DEMONSTRATOR

DOCUMENT

No: 24566Company: TECNOCAD s.r.l.Title: ‘Keylock-2’ - An Electronic Key for Software Protection is

improved by FPGA technology allowing new features.

TTN: CRRReview Date: 15-10-98

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INDEX

ABSTRACT............................................................................................................................................3

KEYWORDS AND SIGNATURE.............................................................................................................3

1 COMPANY NAME AND ADDRESS..................................................................................................4

2 COMPANY SIZE............................................................................................................................4

3 COMPANY BUSINESS DESCRIPTION...........................................................................................4

4 COMPANY MARKETS (BOTH PRODUCT SPECTRUM AND AE PRODUCT)..................................5

4.1 MARKETING ANALYSIS ...................................................................................................................5

5 PRODUCT OR PROCESS TO BE IMPROVED................................................................................8

5.1 LIMITS AND OPERATIVE PROBLEMS ..................................................................................................11

6 PRODUCT OR PROCESS IMPROVEMENTS................................................................................12

7 TECHNOLOGY CHOICE RATIONALE........................................................................................16

7.1 CHOICE OF TECHNOLOGY ..............................................................................................................167.2 CHOICE OF DESIGN AND PRODUCTION METHODOLOGIES AND TOOLS ......................................................19

8 EXPERTISE AND EXPERIENCE IN MICROELECTRONICS OF THE COMPANY (PRIOR OF AE)20

9 WORKPLAN AND RATIONALE...................................................................................................20

9.1 WP 1 - MANAGEMENT .................................................................................................................219.2 WP 2 - SPECIFICATION .................................................................................................................229.3 WP 3 - TRAINING ........................................................................................................................239.4 WP 4 - DESIGN ...........................................................................................................................249.5 WP 5 - EVALUATION ...................................................................................................................249.6 EFFORT SUMMARY AND ROLES........................................................................................................25

10 SUBCONTRACTOR INFORMATION............................................................................................26

11 BARRIERS...................................................................................................................................27

12 STEPS TAKEN TO OVERCOME THE BARRIERS.......................................................................28

13 KNOWLEDGE AND EXPERIENCE ACQUIRED...........................................................................29

14 LESSON LEARNED.....................................................................................................................29

15 RESULTING PRODUCT OR PROCESS, INDUSTRIALISATION AND INTERNAL REPLICATION31

16 ECONOMIC IMPACT AND IMPROVEMENT IN COMPETITIVE POSITION................................33

16.1 TECNOCAD MARKETING IMPROVEMENT.....................................................................................34

17 SUMMARY OF BEST PRACTICE AND TARGET AUDIENCE.........................................................37

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Abstract

TECNOCAD is an Italian company (founded in 1988, turnover 500 KECU) with 3 persons whichdevelops and supplies hardware and software to aid electrical, electronic, mechanical andarchitectural design. It also provides after sales service including training on high added valueproducts. The electronic skills in the company prior to the Experiment were limited to theimplementation of digital electronics using discrete devices.

In this Application Experiment TECNOCAD, realised and implemented its product "KEYLOCK"that is a system used in computer add-on-cards to protect the installed software from its unlawfuluse. The product, realised in this Application Experiment, replaced the previous one based onEPROM and discrete components by using an improved system built around an FPGA andEEPROM.

The market for the Company's products is diverse but the focus for the high added value products,which are the object of this experiment, is educational establishments and it is at national level.

The main objectives of the Application Experiment were the reduction in cost, improvement offeatures and functionality that are anticipated requirements to improve market penetration anddevelopment. The opportunity to gain 'in house' valuable technology skills was key to theManagement's strategy. FPGA technology was chosen for the project innovation because of itsdensity improvement, its flexibility to accommodate on line design changes and the relative ease oflearning of the design process and tools. The cost of the design tools was also influential in thechoice of technology.

The cost of the Application Experiment was 55KECU and the time from start to workingprototype 9 months. The estimated payback period of the investment is 17 months while theReturn on Investment is of 230% estimated over the life of the project.

The design has exceeded specification expectations, for example a 14% reduction in manufacturingcost has been achieved, and the Company now has in-house design skills with which to pursue newapplications. The main lessons learned were that good planning and management of new technologydevelopments can reduce the perceived and real risks and improve the chance of success. TheApplication Experiment is of interest for companies that work in the sectors of informationtechnology and computer equipment.

Keywords and signature

Signature: 3-0410-555-0410-2-3002-1-30-I

Keyword: hardware keys, software protection, FPGA technology, computer,

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1 Company name and address

TECNOCAD S.r.l.

Contact person: Lorenzo RagusaVia L. Beethoven, 200041 ALBANO LAZIALE (RM)ITALYTelephone: +39 0693010055Fax: +39 0693010247E-mail: [email protected]

2 Company size

TECNOCAD is an SME of three employees: 1 senior engineer, 1 junior technician assigned tomarket activities, 1 junior technician assigned to electronic design.TECNOCAD has 10 years experience in the design of hardware protection systems for high addedvalue software running on PC and compatible platforms and had a turnover of about 500 KECU in1998.

3 Company business description

The main mission of TECNOCAD is to supply hardware and software systems for aidingelectronic, electrical, mechanical and architectural design. TECNOCAD is a pre-sale and post-saleservice provider for training, starting-up and maintenance related to the hardware and softwaresystems sold. In addition the designing, manufacturing and selling of its own products completesTECNOCAD activities. (Industry sector 30). Third party products and tools distribution and saleis about 50% of company business, and they typically include:

• Computers and peripherals manufactured by HP, EPSON, CANON, ASEM, SMART,TEXAS INST., ACER, etc.

• Specific application software packages as AutoCAD, OrCAD, Pspice, eCAD, ElettroDataCAD, MicroStation, etc.

• Operating Systems and Office Automation software packages.

Services activity is about 15% of company business, and they may be:

• Consulting to define requirements and specification for multimedia halls and classroom, fortechnical and designing offices.

• Training stages for basic informatics, specialised training stages.

Own products activity is about 35% of company business, and they are:

• A converter from SVGA-PC output to SCART input (for the use of a PC with a TV set)

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• The DSA switch, 2 serial input to 1 serial output with priority logic.• The Keylock, an hardware protection key device to avoid an unlawful usage of software

applications.

The design activity is performed by company internal resources with external consultant ofengineers on particular and specific phases of design and technological applications. The marketing,sale and service activities are performed by company internal resources. The manufacturingactivities is performed by external resources under the control and co-ordination of a TECNOCADtechnician.

The sales of the new KEYLOCK-2 product will be organised by both internal and externalresources. This will allow an increased capability to reach all potential customers, dividing themarket by geographical area and TECNOCAD will continue to operate with traditional customersand will limit his action for new customers in the central regions of Italy. We are evaluatingagreements with some European dealers.

4 Company markets (both product spectrum and AE product)

Starting from cost variation and circulation quantity analysis of software packages market data, itmay be noted a cost reduction in the Office-Automation software and a quantity increase of originalpackage sales. On the contrary, the price of the technical software or software for particularapplications is still high, and it is necessary to protect it from piracy. The best solution is the useof protection hardware keys, for which it is foreseen a considerable increase in the market requests.Since there is the need to keep prices low for protection devices, many manufacturers are engaged tofind either cheaper solution or to offer, together with the device, characteristics and/or additionalfunctions.

The product pricing at the start of Application Experiment was 20 ECU, the product cost is 10,5ECU and the margin is 9.5 ECU. The Application Experiment industrial sector is Computers andother information processing equipment.

4.1 Marketing analysis

At present TECNOCAD is operating only in the national market and for this reason the followingdata are referred to the Italian market analysis.

In Italy, during one year, are sold about 40000 hardware devices for the software protection, havingproceeds of about 800 kECU. TECNOCAD has the 5% percentage of this market, concentrated inthe Centre-Italy districts, for a total of about 2000 Keylock hardware devices.The main world-wide competitor and manufacturer of devices, which operates like the Keylock, isan USA company that covers about 80% of the world-wide market and distributes its productsworld-wide.

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Competitors' success comes, not only from excellent characteristics of the product, but also from alow production cost, due mainly to the ASIC technology used. This technology, used for largequantities of pieces, allows a low cost product.

The Italian market reflects the same relationship (figure 4.2)

The other Italian competitors have products with characteristics similar to KeyLock ones, and theydivide up the Italian market in similar percentages (figure 4.3) The business relation between the“main” competitor and them is clearly unfavourable to TECNOCAD too, whose product Keylockis reaching the commercial convenience limit, not only for the sold quantity, but also for thefunctional limits already shown.

The products sold until 1998 are indicated in the following histogram.

About 1'000'000 pcs (figure 4.1)

Main80%

Others20%

About 40'000 pcs (figure 4.2)

Main80%

Tecnocad5%

Others15%

Italian market (figure 4.3)

"Main"80%

Tecnocad5%

"Small A"8%

"Small B"3% "Small C"

4%

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With the introduction of the FPGA technology in the KeyLock-2 product, TECNOCAD’sexpectations are to capture a part of competitors market, to reach 20% of Italian market, as stated infigure 4.4. This will be possible also thanks to the added new functions, such as an embeddedprinter port configurable as LPT1, LPT2, LPT3 and the possibility to modify the security code inon-line system,

The possibility to modify the security code on ON-LINE system is included to allow the softwareprotection or the activation of procedures through remote access with a modem.

19961997

1998

old keylock

0

200

400

600

800

1000

1200

1400

1600

1800

2000

pcs sales

years

old keylock

old keylock

old keylock 2000 1600 1200

1996 1997 1998

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Since the competitive edge of the major competitor's products is the flexibility of usage related tothe low cost, due to an high rate of production, and a large market penetration, the only strategy thatTECNOCAD can operate is to renew the Keylock design increasing the performances and reducingthe cost.

This new balance of cost/performance will allow to better capture the attention of new customersand, more important fact, the attention of dealers, that we estimate it is the key for a good increaseof sales.

5 Product or process to be improved.

The Keylock product to be improved is a computer ancillary device allowing application softwareto be protected from unlawful and unauthorised usage.It may be used by software-house, programmers and industry as an efficient tool to avoid anddiscourage the software piracy activity and to defend their development investment.

The Keylock is a programmable device allowing a selective control of each software module to beprotected or the overall software application package.

The existing Keylock product, which is going to be improved by the use of advanced technologycomponents, is in compliance with the following basic specifications:

a) Device for the protection of the software against unlawful use by an identification code(User Security Code - USC) and consequent enabling use of the protected software.

Italian market after the introduction of KeyLock-2(figure 4.4)

"Main"70%

Tecnocad20%

"Small A - B - C"10%

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b) Device to be connected to the computer parallel port. The device allows a completeavailability to an external peripheral device, connected to the port (i.e. printer, storagememory, back-up memory, etc.).

c) Electrical specifications:

• Power supply, directly obtained from the connection with the computer(parallel port), between 4.5 V and 5.2 V with a current drain ≤ 5 mA;

• Interface, both versus the computer and the external user, compatible with the“CENTRONICS 8-bit” standard;

d) Physical specifications:

• Case in shock-resistant plastic material;• Dimensions 15 x 42 x 80 mm ( H x L x P );• Connection versus computer by a 25 pin “D-type” connector;• Connection versus external user by a 25 socket “D-type” connector;• Based on an EEPROM, 4 gates, many diodes and passive components.

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e) Environmental specifications:

• Operational temperature 0 to +50˚C• Storage temperature -40 to +65˚C• Humidity 20% to 80% non-condensing• Altitude Operates up to 3000 metres

f) Programming specifications:

• Internal USC setting, to access/enabling the protected software to work, will betypically implemented by the Customer.

• Internal USC must be programmed by a PC through a programming deviceinterconnecting between parallel port and the Keylock to be programmed.

Following figures depict the photograph (figure 5.1) and the block diagram (figure 5.2) of thepresent Keylock product.

Figure 5.1 - Present Keylock view

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Figure 5.2 - Block diagram of present Keylock

5.1 Limits and operative problems

The following limits and operative problems arisen by old Keylock operative use, were caused bynon-standard or updated interfaces both in computers and printers:

• Sometimes printer manufacturers realise an interface going beyond CENTRONICSstandard limits, or else they make a non-standard use of those lines usually not utilised.The consequence is that it is necessary to make hardware diversification on Keylockpeculiar uses.

• Inadequate direct power supply capacity from the port. This problem is present in asensible way on the new HW configurations of computers, that foresee the integration ofthe “parallel port” function in chip custom, using HW internal sink current limitation. Thiscircuit configuration reduces the voltage supply to the EEPROM, presently in CMOSFloating Gate technology.

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The reasons of innovation are therefore to improve the competitiveness of the Keylock increasingits features.No specific parameter performance enhancement were identified for the existing product but somefunctionality's have been introduced and are described in the next paragraph.

.

6 Product or process improvements

The innovative KEYLOCK-2 must be free from limitations and problems above mentioned. Thedeveloped solution has implemented old and new functionalities into an add-on PC board, directlyconnected to the PC BUS.The following is a list of primary objectives to be reached in the project of improved product, inorder of priority:

• Manufacturing cost reduction, cutting the number of component parts.• Testing cost reduction, designing hardware with a high grade of testability via software for

an automatic test procedure.• Functionality improvement, adding applicability and flexibility improvement, parallel

port interface embedded.• Provide universal PC interface capability (ISA and PCI bus interface).

The board layout has been designed in such a way that the same board can be mechanically andelectrically interfaced to either BUS-AT/ISA or BUS-PCI.The printed circuit board (PCB) of KEYLOCK-2 can be installed in either PC buses by turning theboard and changing the position of mounting bracket.It is shown in figure 6.1.

KEYLOCK-2 supply is driven from PC, directly through the bus connection.PC bus recognises KEYLOCK-2 as a parallel printer interface board conforming to Centronicsstandard, selectable among LPT1, LPT2, LPT3, by a jumper on the board.

Many characteristics of this solution, for example:

• PC internal board layout,• use of a direct interface to PC BUS,• use of flexible and powerful large scale integration technology,

allow improvement to the innovative KEYLOCK-2 features, integrating a PC additional parallel portto interface another peripheral device (auxiliary printer, tape streamer, magnetic-optical driver, etc.).

The electrical improvement has been reached by the usage of a FPGA component as a flexible andlarge scale integration chip, performing the same functions as in the existing Keylock discrete logic,improved with:

• the AT/ISA BUS and PCI BUS addressing logics;

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• the AT/ISA BUS and PCI BUS interfacing logics;• the external parallel port handshaking management logic.

As shown in figure 6.2, the component has been designed for replacing all external interfacefunctions and the EEPROM management functions. The component has been designed using atechnology suitable to the new KEYLOCK-2 requirements, taking in particular account the powersupply voltage, the programming voltage and total current drain.

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Figure 6.1 - KEYLOCK-2 outline

Figure 6.2 - KEYLOCK-2 Block diagram

The Keylock must be programmed with the User Security Code. The customer, who needs toprotect his own software package, typically performs this operation. The component has beendesigned to allow the KEYLOCK-2 “on-field/on-board” programming, directly connecting it into thehost computer, without the use of any specific tool.

The product improvement may be quantified in terms of the following parameters:

a) The manufacturing cost reduction was an important issue of product improvement. The cost reduction is explained in paragraph 4.2 and table 4.1. In particular the assembly cost isreduced of 1,6 to 1 ECU.

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b) The manufacturing test cost reduction is a significant item of the product cost reduction and itsvalue is 68 %, as it is shown in table 4.1 ("testing" item: from 1,6 to 0,5 ECU).

c) The production process throughput is improved by a better replication of characteristics andquality of the product, with a consequent 10-15% increase of production efficiency.

d) The main product performance improvement is the capability to interface better the parallelport function of a computer host. The KEYLOCK-2 can operate also when the parallel port isinterfaced with a peripheral protocol or a peripheral driver not fully compliant to theCentronics standard. KEYLOCK-2 has an additional value also in the presence of an auxiliaryparallel port to be added to the interface capability of the host computer. This parallel portfunctionality is obtained from the FPGA without additional cost.

e) The product usability is improved as follows:

• KEYLOCK-2 is now an add-on card of the host PC, mounted inside the PC and not a deviceexternally mounted so as other competitor’s products. This gives a greater guarantee to usersin terms of reliable operation and in terms of security against theft possibility.

• KEYLOCK-2 is better compatible to many software packages to be protected.• KEYLOCK-2 has a high flexibility in the programming phase of the USC (User Security

Code), due to the use of FPGA and SSRAM components.

f) The usage of FPGA technology has given a reduced design cycle time KEYLOCK-2. If we donot consider the time employed on initial design training and the on-job training, the designcycle time may be evaluated with a reduction of 40 %, related to an equivalent design effort for“traditional” design technique (discrete components plus “cut-and-try” technique). The keyissues of this time reduction are the computer aided optimisation of circuits and thecomponents/circuit simulation to verify and to validate both hardware and software design.

g) The configurability of the KEYLOCK-2 is improved related to the capability of thereprogrammability of FPGA microcode allowing a better factory configurability on specialcustomer requirements.

Some improved features and functionalities of KEYLOCK-2 product are not available incompetitor’s products, such as the additional parallel port and the flexibility of reprogrammability.

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Figure 6.3 - KEYLOCK-2 Prototype

7 Technology choice rationale

7.1 Choice of technology

The choice of the technology for the Keylock improvement was started from an analysis of theproduct requirements and the technical and economical benefits. The KEYLOCK-2 product designhas been based on two main electronic components: an Electronic Erasable Programmable Read OnlyMemory (EEPROM) to storage the USC data, and a special component designed by FPGAtechnology.

The main technical objectives considered are:

• The potential capability to design a more flexible hardware towards future implementation ofcodes and performances.

• The high flexibility in the programming phase of the USC (User Security Code).• The reduction of quantity of components related to the enhanced performances of the

product.

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• The capability to add a parallel port interface embedded, without recurrent cost increase.• The capability to provide universal PC interface (ISA and PCI bus interface), without

recurrent cost increase.• The voltage and current drain must be compatible with both ISA-bus and PCI-bus.

The main economical objectives considered are:

• The production cost reduction, both for manufacturing and testing.• The chosen technology must allow a production process improved to increase the production

efficiency by a better replication of characteristics and quality of the product.• The balance point between cost and performance of the high technology component, related to

the marketing perspective.

The technology choice has been oriented to recover functional limits above mentioned, toincrease the performances and, above all, to reduce the costs.

The following are analysis and comparison about possible technological solutions:

• ASIC (Digital, Analog or Mixed): It is a suitable technology to solve technical andperformances development problems. It has a design and production cost too high,since the minimum quantity order, to have a reasonable price, is not justified by theKEYLOCK manufacturing quantity and marketing perspective.

• MULTI-CHIP MODULE (MCM): It is a technology which does not solve technicalproblems with the present circuitry solution and just allows a limited production costreduction. It has not a flexible functional structure.

• FPGA: It is considered the most suitable technology for the solution since it has agood potentiality and flexibility compared to the need, with adequate design andproduction costs. The competitive costs are guaranteed by the large choice of chipand tools manufacturers. Furthermore, the technical know-how and developmenttools are easily re-employed for early future applications.

The FPGA component must perform following functions:

a) interface and addressing for AT/ISA Bus;b) interface and addressing for PCI Bus;c) selection logic for either AT/ISA or PCI buses;d) address decoding for external parallel port (LTP1 - LTP2 - LTP3);e) interface and handshaking management logic for external parallel port

(Centronics-8bit standard);f) interface and addressing management of EEPROM.

The FPGA component to be used in the KEYLOCK-2 shall take particular account of the followingthe basic characteristics:

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• Capacity to correctly operate with power supply voltage between +4.5 Vdc and +5.2Vdc and with a maximum current drain of 20 mA;

• Bi-directional and tri-state input/output interface, with- logic level 0 : ≤ 0.8 Vdc

- logic level 1 : ≥ 2.5 Vdc

The implementation of above mentioned functions requires a FPGA component with an appropriatequantity of internal gates and connection pins. The maximum clock speed required is 200 Khz,characterised by the Centronics standard. The quantity of gates and pins is estimated as following:

GATESFUNCTION DESCRIPTION PINS (min/max)

_____________________________________________________________

a) interface and addressing for AT/ISA Bus 20 800/1000b) interface and addressing for PCI Bus 20 800/1000c) selection logic for either AT/ISA or PCI buses 1 10/15d) address decoding for external parallel port 3 40/50e) interface parallel port (Centronics-8bit standard) 12 900/1000f) EEPROM interface/addressing management 3 40/50

------ ---------------Total 59 2590/3115

After a detailed analysis of FPGA market, the choice is addressed towards ATMEL AT600xcomponent family, having 5V Power Supply and a 4 nS Speed Grade. The AT6002 component,realised in 0.6 µm CMOS technology, has a maximum clock speed of 20 MHz, 64 I/O pins and

6000 gates.

The cost is about 15 ECU for sampling up to 25 pieces, while its series cost for a production of3600 to 7000 KEYLOCK-2 pieces could range from 4 to 6 ECU per piece in 1999. The followingare the reasons why the choice of the FPGA instead of an ASIC has been preferred for this project:

- REDUCED RISKS

The FPGA of the ATMEL AT60xx series are based on a SRAM technology and therefore theyare reprogrammable and reconfigurable (also partially) on field. The reconfigurability can also becarried out in the development system in a few milliseconds, for a complete reconfiguration, andin few nanoseconds, for a partial one. Therefore, the project can be immediately tested andvalidated or modified with no additional cost. Furthermore, the FPGA programming can becarried out both by an external EPROM/EEPROM and by a microprocessor (for example thePC processor itself at the initial bootstrap); this is not allowed using the ASIC.

- FRIENDLY USE

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The FPGA development system is available for MICROSOFT WINDOWS operating system,the 3.11, the 95 and the NT version. Its well known interface and its friendly use allows a quicklearning of the development software, that is not possible in the ASIC/GATE ARRAYdevelopment system which needs EDA tools (e.g. MENTOR), usually available just in UNIXoperative system.

7.2 Choice of design and production methodologies and tools

The design phase includes all the activities performed from new product definition until thecomplete design of KEYLOCK-2. The considerable part of the KEYLOCK-2 design is the design ofthe FPGA component, which constitutes the core of innovative product. During the design phase ithas been used a development tool kit, integrated in a PC allowing to perform the main activities forthe FPGA component design work, as suggested by the FPGA chip manufacturer.

The hardware of the development system consists of:

• FPGA Emulator and Programmer Card (Personal Computer Add-on)• AT6000 Prototype Kit• Personal computer Pentium

The software parts of the development system is composed of:

• View-Logic Pro Capture for Schematic Entry Software• View-Logic Pro Simulator Software• C++ Language Software (Editor, Compiler, Debugger, Emulator, Library)• EXPRESS Software - FPGA & PLD Solution ORCAD (to design printed circuit integrating

FPGA layout)

The FPGA required functions are not complicated, consequently the detailed circuit specificationhas been defined by the “Schematic Entry” technique.In this procedure, a schematic diagram related to the FPGA functions has been drawn by the use ofelementary logic parts captured from FPGA manufacturer library (gate, flip-flop, inverter, etc.) andthen the designed schematic has been verified by a circuit simulation.The View-Logic Pro Capture software has drawn the schematic diagram. The circuit designed hasbeen electrically and functionally simulated to verify its correct behaviour. After drawing andsimulating, the software has provided a Net-List, containing the circuit structure transcription to beexported into FPGA development system. Its internal layout definition, package choice and pinhave completed the FPGA design allocation. The FPGA prototypes fabrication has been carriedout by using a reprogrammable FPGA chip, to make it easier and cheaper to set-up the prototypeand for re-working.

In large scale production and with a project frozen, the opportunity to buy OTP (One TimeProgrammable) chips to be programmed in workshop or just manufacturer programmed chips, for

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further cost reduction will be evaluated. During the production phase, it has been used theprogramming tool integrated in the development system.

The testing phase includes all the activities performed between the manufacture of completeprototypes and their release in compliance with product requirements. During the testing phase anautomatic tool has been realised, hereafter defined as “Test System”, to verify KEYLOCK-2performances and electrical characteristics. The test system is implemented on a PC platform byadding an interface (Test Jig) between the PC bus connector and the Unit Under Test (UUT), aswell as specific software to be loaded in the PC.During the experiment, due to changes to the KEYLOCK-2 interface requirements, it has beennecessary to modify the test software used today in the Keylock. This is in order to allow thewriting in memory of a conventional pattern and to verify the functionality of the memory itself,adding a routine suitable for the evaluation of tolerances for non-standard levels.

8 Expertise and experience in microelectronics of the company (prior ofAE)

The TECNOCAD technical personnel have achieved in the years a complete experience in thedesign and industrialisation of equipment and equipment parts operating on discrete digital logics,and to have a medium level experience in the Assembler software design, oriented to firmware forthe testing sets package development. This experience is the result of activities both directlydeveloped by TECNOCAD and originated by previous job experiences of the proposer and thestaff presently working in TECNOCAD.

Before the participation in the FUSE Application Experiment the TECNOCAD personnel had notany experience in the use of FPGA technology, in the computer aided design technique and in themanagement of a complex program. The starting personnel skill was:

• A senior engineer experienced in digital discrete logics design, (role in the project: projectleader of the Application Experiment)

• A junior technician with a limited experience in digital circuits and software developmentand design of PCB (role in the project: design activities and project technical follow up).

With the participation to the Application Experiment the TECNOCAD personnel have acquired, bytechnical courses and on-job training, the technology and management know-how to carry out designusing said technologies.

9 Workplan and rationale

The experiment is organised in five Workpackages (in the following indicated by "WP"), concerningthe program management, the product and components specification, the training, the new productdesign, the evaluation of new product by fabrication and testing of prototypes. Each WP isorganised in several tasks (in following indicated by "TSK").

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The knowledge transfer has been realised by theoretical training on FPGA specs and training on thejob during system redesign with FPGA.

In the following table 9.1 there is a summary of the Application Experiment project plan scheduling.Although, in the table in section 9.6, the efforts for training and evalation are greater than plannedthe actual overall time schedule is exactly as planned.

Activities 1997 1998Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar

WP 1 - MANAGEMENTTask 1-Project Management

Task 2-Dissemination

Task 3-Reporting

WP 2 - SPECIFICATIONTask 1-Functional Spec's

Task 2- System Spec's

Task 3-Component Spec's

WP 3 - TRAININGTask 1-Managemant Training

Task 2-Specification Training

Task 3-CAD Training

Task 4- Design Training

Task 5- Evaluation Training

WP4 - DESIGNTask 1-System Design

Task 2-FPGA Design

WP 5 - EVALUATIONTask 1- Prototype Production

Task 2-Test Set-up

Task 3-Prototype Testing

Task 4-Functional Testing

Task 5-Field Testing

DELIVERABLES 1D1 2D1 3D1 4D1 4D2 1D2

1D3

1D4

5D1

5D2

5D3

Table 9.1 - Project Plan and Actual Schedule Summary

9.1 WP 1 - Management

The objective of WP 1 is to make the KEYLOCK-2 experiment application a success and fulfil theESPRIT reporting regulations, by project management capabilities useful to maintain the project ontime and budget.

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WP 1 includes the following Tasks :

Task 101 - Project Management, having the objective to allow an efficient andresponsible project and design management.

Task 102 - Dissemination, having the objective to create a sufficient set of informationmaterials for the TTN and the FUSE consortium to enhance the stimulation ofthe first use of technologies.

Task 103 - Reporting, having the objective to create a view on the technical andorganisational aspects of the Application Experiment for the TTN, theSubcontractors and the E.C., including Monthly and Final Reports.

The WP1 was conducted with the guide and assistance of CRR engineers to define the projectplanning, to collect and analyse the data on project progress and to take possible correction actions.Reporting activities were performed without any difficulty, after the guidance of CRR for the initialmonthly report.

9.2 WP 2 - Specification

The objective of WP 2 is to define and issue the KEYLOCK-2 specification, based on the review ofold Keylock. Starting from a critical analysis of old KEYLOCK specification, a new KEYLOCK-2specification must be issued.

WP 2 includes the following Tasks :

Task 201 - Functional specification of product, having the objective to define functionaland operational specifications of the product in compliance with marketrequirements.

Task 202 - System specification of component, having the objective to define the systemspecification of FPGA component, in conformance with the KEYLOCK-2system specification.

Task 203 - Technical specification of component, having the objective to define thetechnical specification of FPGA component, in conformance with theKEYLOCK-2 system specification.

The WP2 was conducted by the senior engineer, with a reduced contribution of the technician(20%), to define all specifications. The guiding activity of CRR (weighted at 18%) was throughoutin the FPGA specification tasks. The WP2 was conducted without any particular problems.

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9.3 WP 3 - Training

The objective of WP 3 is to learn designing, project and technical managing of an advanced FPGAtechnology application. Each specific technical training will be performed by a stage under teachingand guiding of qualified engineers. The training stage will be completed by on-job training.

The technical theory course has been performed at the technical/didactic facilities of the DIA LOG,the agent of ATMEL, for the FPGA technology training. The purpose of this course was to achieveinformation for a better use of the power and flexibility of FPGA technology and the objective hasbeen reached, allowing TECNOCAD to complete the project.The management training has been carried out with a highly qualified contribution of theCONSORZIO ROMA RICERCHE (CRR), that has given its skilled help to perform the technicaland managerial on-job training. At the end of the Application Experiment, TECNOCAD personnelis autonomously able to replicate the “road map” of the KEYLOCK-2 Application Experiment onanother project.

WP 3 includes the following Tasks :

Task 301 - Management training, having the objective to learn the program managementtechnique, which involves advanced technologies project and subcontractors co-ordination. The management knowledge is prevailing performed by an on-jobtraining, under the CRR support.

Task 302 - Specification training, having the objective to learn the technical and productspecification technique involving advanced technologies. The specificationtraining will be prevailing performed by on-job training, under CRR guidance.

Task 303 - CAD training, having the objective to learn the CAD use for designingelectronic products. The CAD training will be performed by a training stage(DIA LOG as ATMEL agency), by self-training and by on-job training.

Task 304 - Design training, having the objective to learn designing a product byimplementing FPGA technology, to increase performance and reducefabrication costs. The design training will be performed by a training stage(DIA LOG as ATMEL agency), by self-training and by on-job training, underCCR guide.

Task 305 - Evaluation training, having the objective to learn to evaluate designs andproducts using FPGA technology. The evaluation training will be performed bya training stage (DIA LOG as ATMEL agency), by self-training and by on-jobtraining, under CCR guide.

The WP3 leader was the subcontractor: DIALOG for FPGA technology and design technique andCRR for management and on job-training. The WP3 has required more design effort than planned forthe technician, but the training time frame was well compared to the planning. At the end of trainingphase, TECNOCAD personnel are able to conduct an autonomous project.

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9.4 WP 4 - Design

The objective of WP 4 is to make the KEYLOCK-2 design in conformance with product and FPGAcomponent specifications and in accordance with the requirements of performance and cost.

WP 4 includes the following Tasks :

Task 401 - System level design, having the objective to design the KEYLOCK-2, basedon innovative performances and technology. The system design aims at aneffective design to meet high quality performance at competitive costs.

Task 402 - FPGA component level design, having the objective to design a newcomponent on FPGA technology, to be integrated into the KEYLOCK-2product. The FPGA component is designed in conformance with the FPGAcomponent specification.

The WP4 was performed by both the senior engineer and the technician in schedule, but with morehours effort (+8%). This was due to circuitry variation in phase of design, adding a SSRAM chip,allowing to store a FPGA configuration pattern. The use of this capability allows more flexibility,by the easiest modification of the FPGA structure with, consequently, the implementation of newfeatures for future improvement of KEYLOCK-2 applications. Design activities were assisted byCRR engineers with an important contribution to remark potential warning. In particular they wereuseful to a correct definition of FPGA pins.

9.5 WP 5 - Evaluation

The objective of WP 5 is to evaluate the quality and validity of the KEYLOCK-2 design. Theevaluation task will be carried out by producing and testing 10 of KEYLOCK-2 prototypes.

WP 5 includes the following tasks :

Task 501 - Prototype production, having the objective to product 10 pieces ofKEYLOCL-2 prototype. The prototypes are fabricated by technical designdocumentation and, at the same time, it was verified the production technicaldocumentation.

Task 502 - Test set-up, having the objective to develop a test methodology and relatedtest set. The methodology consists of a software procedure implemented on aPC, in which the unit under test is connected to the PC bus through a test setinterface.

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Task 503 - Prototype testing, having the objective to test electrical and mechanicalcharacteristics of prototypes, in conformance with a design validationprocedure.

Task 504 - Functional testing, having the objective to test the functionality ofprototypes

Task 505 - Field testing, having the objective to test the prototypes in an on-fieldoperation.

The WP5 was conducted by both the senior engineer and the technician in schedule, but with morehours effort (+ 8,7%). This was due to a better design of test set architecture for improving the testcapability and, consequently, to increase the product quality and to reduce the cost of productiontesting. The guiding activity of CRR (weighted at 12%) was throughout in the FPGA performancetest definition. At an overall view, the WP5 was conducted without any particular problems.

9.6 Effort Summary and roles

The following table is an efforts and costs summary of First User and Subcontractors labour.

WP Description Effort(Person/days)

Cost(KECU)

1 Management 49 11

2 Specification 13,5 3,2

3 Training 30,75 10,4

4 Design 49,5 12,6

5 Evaluation 50 10,8

total 192,75 48

The next table reports the effort supported by TECNOCAD and subcontractors.

TECNOCAD LABOURSubcontractors

hours costshours %TECNOC

AD hourscosts

WP DESCRIPTION Senior Eng. Technician (KECU)Planned

Actual Planned

Actual

(Estimate)

planned

1 Management 320 392 ---- ---- 8 90 23% 3

2 Specification 80 88 24 22 2,6 20 18% 0,6

3 Training 144 144 88 102 5,8 120 50% 4,6

4 Design 280 320 88 76 9,2 110 28% 3,4

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5 Evaluation 136 168 232 232 9,2 50 12,5% 1,6

TOTAL 960 1112(*) 432 432 34,8 390 25% 13,2

(*) the surplus hours have been founded by the company itself.

The FU was involved in each task of the project. The project has been developed with a strongcollaboration between FU and subcontractor. The primary task of the subcontractor was thetransfer of knowledge of the technology design requirements and the methods and use of the tools.Product specifications were provided by TECNOCAD while the choice of tools was a joint effort.The subcontractor basically provided training on the design methods and the selected tools toimplement the FPGA as well as assisting with the selection of the specific technology.

10 Subcontractor information

To meet the Application Experiment objective, TECNOCAD needed the consultancy of expertcompanies because of its insufficient skill on microelectronics technology.The TECNOCAD has analysed the problems connected to the development of the ApplicationExperiment and, with the support of local TTN, has characterised required helps in:

• A correct and quick approach to better plan activities and resources to reduce risks andtime-to-market.

• Choosing the right technology and the right design techniques.• Understanding the microelectronics world, its rules and limits.• A complete training stage about the FPGA technology, directly oriented to the use of

designing and testing tools.

The selection of subcontractors was performed with particular reference to their experience andgood aptitude to guide and teach right technique and methodology to a small enterprise, atreasonable costs. The technical support for the training on the job and design activities has beenprovided by the CRR. The natural choice was the CRR because of a previous experience ofcollaboration.The best candidate for providing the training on the selected technology was DIA LOG S.r.l , highlyqualified by ATMEL, because was also the potential supplier of FPGA chips.

In the following are reported a summary of their experience.

Consorzio Roma Ricerche

The Consorzio Roma Ricerche (CRR) acts, from September 1986, as support structure for the smalland medium size enterprises (SME) for design, testing and realisation of microelectronics devices.The aim of Consorzio is to establish a co-operation between research Centres, Universities, Hi-Techenterprises and users, industrial enterprises in particular of medium and small size. This action isstrategically relevant since it gives the possibility to Italian SME to increase their internationalcompetitivity in the innovative field of the microelectronics.

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The main characteristic of the Consorzio is the complementary of the partners that are Universities,Hi-Tech enterprises and research centres. This structure allows following the user enterprise fromthe design to the realisation of the microelectronics activities to complete the transfer of technology.

The presence of CRR people has been oriented towards all the “road map” of the KEYLOCK-2project with a determinant contribution for the final objective in terms of technical results and timescheduling. Particularly the effectiveness of the project management training and guiding has beenuseful to complete the experience of the TECNOCAD project leader in planning and controlling theactivities.

DIA LOG

The DIA LOG company is the middle Italy exclusive dealer of NEWTEK, a division of RAABKARCHER. The NEWTEK, and consequently also the regional dealer DIA LOG company, is theagency for ATMEL Corp. components and technology dissemination. The ATMEL Corp. isestablishing two factories in France to produce programmable logic, memory and microprocessordevises, based on FLASH technology.DIA LOG company delivers high technology components and related technical services and theDIA LOG personnel have expertise and experience, qualified by ATMEL, to make instructioncourses on FPGA technology.

The DIA LOG engineers contribution was useful to complete the TECNOCAD experience in theCAD generic use for designing products and to teach the FPGA technology and its implementationinto a low cost product such as KEYLOCK-2.

A contract of collaboration has been realised between CRR and TECNOCAD following theprocedures of previous collaboration. A contract for assistance has been realised betweenTECNOCAD and DIA LOG without specific penalties.

11 Barriers

The barriers perceived by the company in the introduction of microelectronics technology can besummarised as follows:

1. Preliminary problems in the selection most suitable microelectronics technology for theimprovement of old Keylock.

2. TECNOCAD is a very small enterprise and its personnel have not the experience to set out afeasibility study in a correct way for better evaluating the project risks.

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3. The personnel of TECNOCAD were lacking in experience, especially the junior technician,creating some problems in the learning of the use of the new work tools, and in theunderstanding of the new technology.

4. No experience in the realisation of complete and correct workplan and in management ofinnovation.

5. The selection of consulting subcontractors was a decision problem. To have a right managerialand technical guide to the project leader and how to interface them

6. The perception of high financial risks associated with microelectronics development was aproblem with two aspects: the direct economical risk to use a new (for TECNOCAD)technology and the risk impact on the time-to-market for the improved KEYLOCK-2, due tolearn technology and usage methodologies.

All the above problems have been perceived as risk and fears in the introduction of a newtechnology.

12 Steps taken to overcome the barriers

The first big step towards the solution of the underlined problems was the first contact with theTTN that leaded the company to the right technological solution.

1. The selection of the most suitable microelectronics technology for the improvement of oldKeylock was made together with the TTN as described into the chapter 7.1 of this document.

2. The setting out of the feasibility study and the Application Experiment Proposal was analysedand guided with the help of the TTN. In particular, a determinant contribution was given on thedetermination of the cost and return of investment, for better evaluating the project risks.

3. The lack in the knowledge has been overcome by paying more attention (and so more time) tothe ON-JOB TRAINING, even through this causad 20 hours overrun of the planning made inthe work-plan lined out in the proposal.

4. Also the setting out of the project workplan was prepared with the help of the CRR consulting,with a particular reference to the analysis of men-hours effort and durable equipment effort.

5. Two types of consulting subcontractors have been selected: the CRR for the managerial andtechnical aims of the project, and the DIA LOG for specific training stages. The choice wassuggested by the CRR experience directly oriented towards E.C. programs, and by the DIALOG technical expertise, highly qualified by ATMEL, a potential supplier of FPGA chips.

6. The practical assistance from the TTN and Subcontractors has given an high contribution to theknowledge of business planning technique, technology selection and risk management analysis.

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This assistance was determined to face a product improvement based on an advancedtechnology solution.

The use of more conventional technology would have resulted in a limited market penetration of thenew product.

13 Knowledge and experience acquired

At the conclusion of the Application Experiment experience, TECNOCAD has acquired thecapability:

• to manage risks of advanced and complex projects;• to realise a business plan and to evaluate investments and resources;• to select a technology for a better balance of cost/performance;• to design an FPGA from specification to testing (use of the design tools for FPGA)• to define a product specification, oriented to a market advantage (market and competitive

analysis);• to follow up a project involving external resources.

The experience acquired during the project, has allowed TECNOCAD to manage new projects forfuture advanced products. The knowledge acquisition of the FPGA technology, is a great incentiveto replicate the experience of this project to innovate also other TECNOCAD products.

The choice of the right subcontractors has been perceived as a fundamental one in order to achievethe knowledge transfer of the new technology. The first choice has been “CRR” from which we havelearned how to set up, how to plan and how to control the evolution of the Application Experiment.The second subcontractor “Dia.Log.” allowed us learn how to write technical specifications, andtrained us in the use of the FPGA’s simulation tools.

The learning processes went through a formal training, as well as a training on the job. The resultsachieved are beyond the FU expectation of just technological know-how acquisition. In a selflearning way supported by the TTN the FU learned the project planning and management, skill thatTECNOCAD will use again for all its future electronics projects.

14 Lesson learned

The participation to the FUSE Program, with the KEYLOCK-2 project, has taught us how toconfront a new product specification and design “road map” with a quick time response to internaland external problems, especially for specification change according to customer requirements andfor technological improvement of components. Undoubtedly a careful analysis of the aims of theproject during the planning phase, contributes to reduce the possibility of errors.

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These errors could be caused by a wrong valuation of times and costs. Although the technologyimplemented during Application Experiment has been acquired without problems, somemodification on project progress has been done.

The difficulty in allocating personnel to the project has been a big problem for our small company.The training task required 20 hours more than the foreseen in the project beginning. On one handthis gave the possibility to complete the technology knowledge transfer, on the other the resulteddelay in the scheduled activities caused some time sharing problems to our technicians. They had toshare their time between the training activities and the ordinary day by day job. Now we know thatthe training task is a fundamental one for an enterprise that want to learn a new technology and as aconsequence it has to be well evaluated from the beginning the time allocated to this activity.

In the specifications definition we did not consider the high flexibility required by the product andduring the design phase we had to introduce a SSRAM. The lesson learnt is to consider all aspectsof product for preventing system redesign that can carry dramatic changes and delays and also thefailure of the project due for example to short time to market requirements.

Now, at the end of program, we are sure that the analysis of time and resources is the essentialpreliminary phase of the entire project. We believe that this is the main lesson learned and we willre-organise our design methodology for future programs.

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15 Resulting product or process, industrialisation and internal replication

The resulting product is compliant with the specification and it operates correctly and meets thecustomer needs for a competitive price. KEYLOCK-2 has exceeded the performance expectations atthe start of the project.

During system design and related circuit simulation, we realised to add into the circuit an unforeseencomponent that would allow more flexibility for future improvement of KEYLOCK-2. Thecomponent is an SSRAM chip, which can store the FPGA configuration pattern. The use of thiscapability allows easy modification of the FPGA structure with, consequently, the implementationof new and initially unforeseen features.

The management of the Application Experiment produced some prototypes of KeyLock-2 verysimilar to the final version of the product.The tasks to industrialise the Keylock enclose:

• remake of the PCB and the substitution of the FPGA mounted on a socket with an FPGAmounted directly upon the PCB. This reduces the cost of the product and increases the return.The increased return and the growth of the flexibility of the product, improve the “time tomarket” for new products based on KeyLock-2.

• evaluation of prototype.• search for distributors to cover the national market; the present marketing activity of KeyLock-

2, is directly followed by TECNOCAD Srl, as the small number of customers can be easilysatisfied. The aspiration to expand the market, needs a bigger penetration capacity and a verythorough cover of the market, while for the foreign countries, TECNOCAD’s web site which isbeing completed and which will have a page dedicated to KeyLock-2, will be used.

The product is already in production. After 6 months of Application Experiment conclusion thefirst lot of products has been realised. The first lot of KEYLOCK-2 has been manufactured and soldto customers. In a first time, we have manufactured a lot of 50 pieces for pre-production test, aftera very small adjustment to the printed circuit board. All 50 pieces have had a positive response toproduction tests and they have been sold to customers, with their satisfaction. The first lot (100pieces) of normal production has been manufactured and 50 pieces of them has been sold. Thecommercialisation of this first quantity of KEYLOCK-2 has made by a TECNOCAD salesman toprevious customers, who were involved, before the Application Experiment proposal, inperformance requirement definition of the new product.

The industrialisation cost for the first 50 pieces has been around 15 KECU (including personnel andmaterials). At present a second lot of 250 is in production and will be distributed by ourdistributors.The schedule of industrialisation foresees a production of 550 pieces to be sell within 2000.

TECNOCAD is already evaluating the opportunity to replicate the very positive experience of theApplication Experiment. TECNOCAD will introduce the acquired FPGA technology in another

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product. The FPGA component will be used to control a camera able to follow a video target and atthe same time automatically adjust the focus and control the zoom mechanism.

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16 Economic impact and improvement in competitive position

The analysis of the market sales of the old Keylock ( the not improved product), based on the salesof the last 3 years, had demonstrated its future quick obsolescence at the end of 1999. The quantitysold in the 1997 was about 1600 pcs, against 2.000 pcs in 1996 and the forecast in 1999 will beestimated of 800 pcs, with a forecast in the fall of turnover to about 16 KECU.

The following table compares the forecast sales for the new and old Keylock.

Figure 16 – Sales improvements

The Keylock price is 20 ECU and the production costs are shared out as follows:

product cost composition Old product(ECU)

Newproduct(ECU)

Printed Circuit Board 1 3Components 4,2 4,2Discrete Components 1,3 0,1Mechanics 0,8 0,2Assembly 1,6 1Testing 1,6 0,5

total 10,5 9

The next table shows the profitability increase in the normal case, on the whole life of the product.

1999 2000 2001 2002 2003Increaseprofitability(KECU)Normal case

48,2 76,8 103,4 94,6 63,8

The operation of improving the product (the new KEYLOCK-2 product) will energise the saleswith a perspective to sell about 9.400 pcs (worst case 6.800 pcs; best case 13.000 pcs) for a marginforecast of 103 kECU (worst case 75 kECU; best case 143 kECU).In the normal case the payback period was estimated in 13 months.The Return on Investment in the normal case is of 686% estimated over the life of the project (5years).

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All the above mentioned data are compliant with those shown at the Application Experimentbeginning and their expectation can be confirmed at the end of the Application Experiment, with thecomfort of performance and technical results of the KEYLOCK-2 prototypes. The designmodification defined during the design phase, including a SSRAM component (see chapter 15), hasallowed a circuit structure more flexible to realise other products without changing any components.These products will be based on the same hardware structure with the implementation of a differentFPGA microcode to realise new operational requirements.

In the future, TECNOCAD will be able to produce a family of add-on cards for computer with littleresources and low financial investments, by a replication of the experience and technology expertiseacquired in the KEYLOCK-2 Application Experiment developed under the FUSE Program.

16.1 TECNOCAD marketing improvement

TECNOCAD Company is also engaged to offer a more flexible device, with a state-of-the-artcharacteristics, employing FPGA technology that guarantees flexibility, power and lowerproduction cost with the objective to improve its market penetration. To ensure the productcontinuity, the new product is named KEYLOCK-2.

Many customers of the present obsolete KEYLOCK, have shown a great interest in the newKEYLOCK-2 project. This interest is generated by the upgraded characteristics of the new device,suitable for a larger application range, thanks to its friendly use, flexibility, on fieldreprogrammability and larger compatibility with the external peripheral.

During the last months, TECNOCAD Company has carried out a market research to gain othercustomers, supported by agencies in the North and South Italy, while the Centre Italy is managedby TECNOCAD itself. The result of this research is quite encouraging and it is possible to estimatea remarkable increase in the KEYLOCK-2 request amounting in a range of 3000 - 3500 KEYLOCK-2 per year, after a starting phase, instead of the present 2000 Keylock units per year. Furthermore,TECNOCAD Company is coming into contact with European partners, both by INTERNET andby normal distribution channels, to offer the KEYLOCK-2 to European Countries. The first resultsare very positive, with a perspective of a further growth of about 2000÷3000 pcs/year fromEuropean customers potential orders.

The interest is mainly due to the system solution adopted to interface AT-ISA bus or PCI bus usingthe same product, besides the flexibility to reconfigure the device on field. These performances allowa large employment also in the cheaper software protection, with consequent increase in the marketrequest.

The product development has permitted an actual cost production lower then the forecast ofKEYLOCK-2 cost reduction estimated at the product planning phase. The actual product cost is 9,0ECU instead of 9,4 ECU forecasted (roughly - 4,3%) and instead of 10,5 ECU (roughly - 14,3%)related to the old Keylock. The product cost reduction is due to a market cost reduction ofcomponents.

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Table 16.1 shows the estimated sales and profit to be expected from the KEYLOCK-2 improvedproduct. In table 16.2 is shown the Pay Back Period that is reduced by one month (17 monthsinstead of 18 estimated) due to the increase of profit/unit.

Projected sales ( pcs )1999 2000 2001 2002 2003

Worst case 3600 5200 6800 6200 4200

Normal case 5000 7200 9400 8600 5800

Best case 7000 10000 13000 12000 8000

Profit/unit Total profit ( ECU )11 1999 2000 2001 2002 2003

Worst case 39600 57200 74800 68200 46200

Normal case 55000 79200 103400 94600 63800

Best case 77000 110000 143000 132000 88000

Table 16.1 - Estimated Sales

Cap. Invest. (ECU)

Expected profit

(1999)

Expected profit

(2000)

Expected profit

(2001)

Capital return

(Months)

Worst case 60000 39600 57200 74800 17Normal case 60000 55000 79200 103400 13

Best case 60000 77000 110000 143000 10

Table 16.2 - Pay Back Period

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17 Summary of best practice and target audience

The TECNOCAD product (code 3002 in the standard system designed for use throughout the EU)is classified as: Computers and Other Information Processing Equipment.

The sector that can be stimulated by this Application Experiment, to replicates this experience, ismainly the same of the Prodcom code. This kind of device can be of interest also for everyenterprise that works in Electronic Components (code number 321), and in Industrial ProcessControl (code number 333) because it can have the problem with the software protection.

We have to outline that the Keylock system, the Application Experiment product, solves theserious question of installed software protection. Therefore it can be of interest for the enterprisesworking in security field. This product will allow TECNOCAD to increase the software sells,because the greater SW protection. Moreover TECNOCAD firm is a very small enterprise withonly three employees. The effort done for realising the project and the experience acquired forachieving the Application Experiment objective, can be good examples for other Small MediumEnterprises of the same sector. It has to be considered that in the same area of the enterpriselocation the enterprise belonging to Office machinery and Computer sector are more than 92% of theoverall firms. The same concept is for SME of Electronic Components and Industrial ProcessControl that are about 61%.

The best practice of this AE can be summarised:

1. Use of TTN to give vendor/technology independent advice2. Involvement of personnel at all levels, in best practice training and on the job support.3. The use of a dual subcontractor contribution to give advice, support and detailed design

assistance.4. A focus on the specification at initial stage avoids expensive redesign.5. On the job training give company staff the capability to improve other product with the same

technology.6. Choice of design tools appropriate for the small company.7. Use of simulation avoids expensive redesign.

Company in industry sectors defined by the following Prodcom codes will therefore benefit

PRODCOM codes: 3002, 3210, 3330