61,676 followers
USA already has access to semiconductor capacity … one way or another… we should also focus on what we really good at … semiconductor innovation! ChipsACT’s primary goal seems to be building domestic semiconductor capacity. But total funds available are limited so the question is that the right focus? Should we be just focusing on capacity and/or innovation ? As far as capacity is concerned, even if the capacity is threatened in Taiwan ( a theoretical remote possibility) we have fully equivalent, or perhaps better capacity available in South Korea as Samsung has sufficient capacity or can build sufficient capacity to meet US and the rest of the world if the need arises. On the other hand, there very few pockets, if any, which have the capability of doing the innovation needed to move the Semiconductor industry to the next level, those pockets currently exist in only two or three places in United States, such as Silicon Valley, Boston, and Austin. This combination of research centers and universities are underfunded and unable to keep up the pace of Semiconductor innovation needed to make the next generation breakthroughs. The other source of semiconductor innovation (although they focus on rather short term innovation) is semiconductor companies. If we decide to cutoff the Chinese market to USA companies, the revenue will drop and so will be their R/D budgets. so even that source of innovation will be starved. Even if a quarter of ChipsACT funding is applied towards innovation of American semiconductor rather capacity building, It is highly likely that USA can get a lead over other nations, in terms of next generation of Silicon or Semiconductor, technologies and hence, combined with the capacity available in US and allied nations with the innovation in United States, we can become a formidable force in semiconductor industry and retain our lead over the coming decade. Most experts believe that China will eventually build capacity, so focusing on capacity only gives a short term lead. China is on its way to lead the world in shear amount of research in semiconductors. Although the quality is not quite there, but it will get there. With tremendous help of the state and central planning, hundreds of labs and universities will eventually start producing quality research and may surpass USA in semiconductor innovation. That may create a sustaining long term advantage for China. So it makes sense to allocate a sizeable portion of ChipsACT towards funding of universities via NSF, DARPA, enhancing national semiconductor research labs and direct funding of innovation at semiconductor companies. This will create a lasting advantage rather than short term advantage. Unfortunately, universities and research groups cannot hire lobbyists and hence there is few to argue their case in DC. This bold step has to be taken our leadership in Congress and senate for the future of USA semiconductor industry.