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America's pressures on the technology industry for military superiority

Pentagon officials are in talks with tech executives to find a solution to a key question: how to secure advanced supplies in the future chip computers needed to maintain America's military superiority.


Conversations, some of which preceded the Trump administration, have recently become more frequent, according to people who participated or were informed about them. Pentagon officials encouraged executives of companies providing the chips to consider setting up new production lines for suppliers in the United States.

Discussions are being driven by the Pentagon's growing dependence on overseas-made chips, especially in Taiwan, as well as recent tensions with China.

A chip maker, the Taiwan Semiconductor Manufacturing Company, known as TSMC, plays a particularly important role in the production of commercial chips that also have applications in aircraft, satellites and wireless communications. Because of the turmoil in recent months in Hong Kong's semi-autonomous Chinese territory, some Pentagon officials and executives at the chips makers have been considering cases where they could force Taiwanese suppliers to restrict or cut off chips.

Mark Liu, president of TSMC, said he had recently discussed the possibility of a new plant in the United States with the Department of Commerce. The obstacle was money, as significant subsidies are needed, he said, because they are more expensive to operate on American soil than in Taiwan.

"It depends on when we can close the cost gap," he said in an interview.

The United States has long acquired the most sophisticated weapons utilizing electronic components manufactured exclusively in Taiwan. Chips help tanks, aircraft, missiles, and ships navigate, communicate with each other, and intercept enemy targets.

However, the domestic production lines of many chips have been moved out of the country for many years, raising questions about production shutdowns in the event of political or military crises abroad. These fears have been exacerbated by the importance of specific components - such as Silicon Valley Xilinx-designed programmable chips for the F-35 fighter jet, built primarily in Taiwan.

"We at the Department of Defense cannot afford to rule out all of these possibilities," said Lisa Potter, deputy secretary for research and technology.

Dr. Porter, at a technology event in Los Angeles on Wednesday, said secure supply chains for both key components and software were a matter of co-operation between the Pentagon and the technology industry. He declined to discuss concrete efforts to boost US chip production.


In another indication of immediate action, Skywater Technology, a chip maker in Minnesota, said this week that the Department of Defense will invest up to $ 170 million to increase its production and enhance technologies such as chip production capacity can withstand radiation in space.

Dr. Porter and other Pentagon officials have pushed for new security techniques, in addition to security guards and staff control, to maintain sensitive chip plans, a strategy that will help the Department of Defense use more advanced manufacturing plants. He called the idea a "zero-confidence philosophy."

TSMC, which dominates "build-to-order" services, has recently taken the lead by Intel shrinking chip circuits to give chip more capability. Its productivity is one reason why the company has continued to gain jobs from major US chip designers such as Apple, Qualcomm and Nvidia, whose chips have become increasingly important for both defense and civilian applications. .

The United States remains the leading supplier and leader in most chip technologies, including processors sold by Intel for almost all PCs and server systems. However, the Pentagon's research arm - DARPA, the Office of Advanced Defense Research Programs - has been pushing for chip innovations since 2017 in a $ 1,5 billion electronic device development initiative.

His goals include finding alternatives to silicon for making and packaging small "chiplets" instead of creating large monolithic chips.

"We have vulnerabilities that we really need to address, but we continue to be the world 's leading electronics maker," said Mark Rosker, director of DARPA' s microsystem technology bureau.

Much of the recent urgency stems from China's growing stature as an innovative chip maker. Designers have developed chips for sensitive applications such as supercomputers. Many of the designers - including Huawei, a key target of the Trump administration in the trade war - also rely on TSMC for construction.

Another reason for America's immediate action comes from a recent GlobalFoundries recovery. The chip maker, owned by investors in Abu Dhabi, has spent about 12 billion on a plant in Malta. However, it announced last year that it would stop trying to create smaller circuits than in existing production processes.

The company, which announced plans for a $ 10 billion-dollar plant in China at 2017, is reviewing the project as promising customer demand there now appears uncertain, said Thomas Caufield, chief executive of GlobalFoundries.

The influence on the chip industry was easier when the US Department of Defense represented a significant portion of chip sales. Defense applications are now degraded by political uses, such as smartphones and personal computers. Much of the Pentagon's budget now goes to chips whose plans are shaped by business needs.


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