This may seem weird but don't give us all the chip funding, say Intel and friends

A newly formed group is calling for the US to ensure efforts and public funding to boost the nation's domestic semiconductor industry benefits a broad family of stakeholders, not just a few companies. The Semiconductor Alliance, which took form mid-2021, just got the backing of three major American chipmakers, including Intel …

[Filippo]

Must not look like we're running a monopoly here, eh?

[Doctor Syntax]

Or cover all the niches so other countries don't get a foothold.

[katrinab]

I think it is more that the want to see investment in the whole of the supply chain, ie their suppliers and customers. Otherwise they are going to end up with a load of surplus capacity that they can't use.

[Anonymous Coward]

I'd have to agree that is part of their motivation, but I think as others have posted below, their greater motivation is to build a healthy market of custom chip design companies in the US to conveniently manufacture their chips at the big boys' fabs.

After all, starting up a fab is not within the realm of a typical business budget, but design work is. And if the big boys just happen to turn massive profits while doing that manufacturing, well that is just purely by accident and good forecasting on their part, right?

It isn't like if they did good forecasting and planning they wouldn't have kept and maintained their North American capacity in the first place instead of farming so much of it to Asia...

[Patched Out]

Where is Texas Instruments?

Where is Texas Instruments in all this? They are at least as big a player as Analog Devices. Are they not participating?

[Pete 2]

The long game

You can see why the big players want the money spent on nurturing small and new chip companies.

That way the mega-corps can simply buy the successful ones later for much cheaper than developing the same new technologies themselves (and risking failure, too).

[phuzz]

Re: The long game

Plus, given the massive costs involved, only the big boys are going to be running the actual fabs, so they want a healthy ecosystem of companies designing custom chips, who will then need to go somewhere to get them made in bulk.

[teknopaul]

Re: The long game

Perhaps true. A few people in the states are waking up to the fact that competition is a good thing™.

Huge monopolies have not been very creative of late. e.g Google & Facebook allowing other countries to compete.

[Daedalus]

Re: The long game

Exactly. And given the ecology of large companies, they know that their own staff would find creative ways to waste the cash, whereas giving it to (hopefully legitimate) hungry entrepreneurs will let them jump in when the time is ripe and maybe even replace some of their oldsters with new blood.

[fch]

Re: The long game

Honestly, I can't see a fault with that approach. For many smaller companies, the buy-out would be taken as proof of success, and the marketing as well as cap-ex powress of the buyer be seen as the needed lever to take a superior product to stellar sales. After all, what good is it if you've designed the most-fabulous CPU of the last 1000 years and adapted it perfectly to ASML's beeleeon-of-beeleeon-gigadollar chipmaking machinery ... if you can't afford as much as their waste heat nevermind the kit to do a real wafer run.

Acquisitions aren't necessarily evil; think AMD purchasing NexGen and turning that tech into the Athlon and Opteron CPUs; without that acquisition, we'd probably using overpriced overheating Intel Itanic (as partner-buyout from HP) to this day. Or, gasp, Oracle SPARC (another acquisition, that). Damned. Acquisitions everywhere. Did I mention Apple bought PA Semi, instead of setting up their own chip design team from scratch ?

I suspect we'll see both chip design and manufacturing becoming more of an "aS" type business. And only the largest users will in-source - either design, or manufacturing, or both. In a way, by and large, we're actually there; that's how TSMC runs their business. If the funding billions go to build a to-order shared fab, it may just become v2 of that. Or so the initators must hope.

[very angry man]

Fug me! I thourt this sounded like a good thing, thanks for bringing me back to reality, it is amurkia after all