Bloomberg reports that U.S. President Joe Biden’s administration plans to launch a $5 billion semiconductor research alliance to support U.S. chip design and hardware innovation and counter China’s efforts to occupy the forefront of the industry. Officials will formally establish the National Semiconductor Technology Center (NSTC) on Friday, the second major R&D investment under the Chip Act of 2022, following the $3 billion advanced packaging initiative.
Dr. Laurie E. Locascio, the U.S. Department of Commerce Under Secretary for Standards and Technology, told Bloomberg News that the alliance plans to invest hundreds of millions of dollars in workforce development and intends to open applications for research funds in early March.
She said officials are working to prevent China from benefiting from NSTC-funded research while filling gaps in the U.S. research ecosystem in key areas such as packaging and hardware, as electronic components have become a key battleground between the U.S. and China.
"As our main competitor, they are now investing a lot of money in chip design and chip manufacturing in China," Locasio said. "We're obviously looking very, very carefully at how to put the right guardrails in our funding opportunities -- how to protect intellectual property, how to develop research security plans."
Locasio said it was too early to say whether those funding rules might include a ban on any collaboration with Chinese researchers or universities, but added that U.S. officials were "highly concerned" about research security issues.
U.S. chip production has been shifting to Asia for decades, and the Chip Act sets aside $39 billion to encourage production and $11 billion for research and development to revitalize the U.S. chip industry. While much of the public focus has been on providing subsidies to companies building factories in the United States, the government has also been establishing a research agency that some industry experts believe may prove to be a more critical effort in the long run.
While the Commerce Department said the work was swift, major chip companies are increasingly frustrated that they have yet to receive a single dollar of federal funding 18 months after Biden signed the CHIP Act into law. The government plans to announce the largest production subsidy by the end of March.
Officials have not yet selected a location for the NSTC headquarters. Locasio said the consortium's investment was intended to supplement private spending and make chip R&D and manufacturing capabilities "accessible" across the country, but he did not identify specific locations. Arizona, Texas, Ohio and New York have each received large plant investments, and Indiana is slated to receive one.
Deirdre Hanford, a longtime Synopsys executive who was recently named CEO of Natcast, the nonprofit entity that will operate the NSTC, said there are "other states that could make similar changes to their industries."