Applied Materials Plans $4B R&D Center in Silicon Valley

The birthplace the semiconductor industry will be the location for the largest R&D facility in the industry: Applied Materials, which makes the machines that make silicon wafers measured in molecular nanometers, announced it is planning to build a $4B research center in the heart of Silicon Valley.

The company, which is based in Santa Clara, will invest $4B to build the project over the next seven years—including what it hopes is a large federal subsidy from the $52B CHIPs Act that was enacted by Congress last year to eliminate the US dependence on Asia for semiconductors.

“The scale and pace of what we do is dependent on [government] incentives,” Applied Materials CEO Gary Dickenson told Bloomberg, in an interview.

The project, which will be located on Applied Materials’ Santa Clara campus and known as the EPIC Center, was formally announced on Monday at a semiconductor “summit meeting” at the Santa Clara HQ attended by Vice President Kamala Harris.

The name of the new research center, EPIC, is short for “equipment and process innovation and commercialization.” The facility will enable chip manufacturers and academic researchers to test new chip designs on a production line with the most advanced equipment.

With cleanroom space the size of three football fields planned for the facility, competing semiconductor manufacturers will be able to conduct research in separate sections of the center at the same time.

The goal of the EPIC Center will be to reduce the lead time for the commercialization of new semiconductor technology and to help overcome the largest hurdle to US semiconductor independence: attracting and training workers for the semiconductor industry.

More than 50 new semiconductor facility projects have been announced since the CHIPs Act was enacted, with private companies pledging more than $210B in chip fab investments that will augment the $39B the government is expected to spend on new chip-making facilities.

The wave of new chip fabs is expected to exacerbate an already severe shortage of qualified workers in the semiconductor sector: according to a Deloitte report, the industry faces a shortfall of 90,000 workers in the coming years; McKinsey is projected that this gap will grow to about 300K engineers and 90K skilled technicians in the US by 2030, according to a recent report in The New York Times.

The EPIC facility will rival the Albany NanoTech Complex at SUNY Poly’s College of Nanoscale Science and Engineering as the most advanced chip-design research facility in North America, tapping into Northern California’s leading research universities, including Caltech and Stanford.

The Albany, NY facility is part of a semiconductor hub that includes Global Foundries’ chip fab complex in the Hudson Valley.

Some industry leaders are hoping that technology is the antidote to the computer engineering shortage, with artificial intelligence reducing the number of computer scientists needed in the semiconductor industry, much in the way GPT-4 co-pilot platforms are taking over coding in the software industry, the NY Times report said.

Others are urging the government to widen the visa program for foreign grad students in computer science, so they can work for US companies after they graduate, instead of moving to Canada where the government is encouraging new residents from overseas.

Chip-makers are initiating their own initiatives to spur workforce development. In Maricopa County, AZ—home to Intel’s primary semiconductor manufacturing hub—three community colleges have teamed up with Intel to offer a “quick start” program to prepare students to become entry-level technicians in just 10 days.

During the four-hour classes, students learn the basics of how chips are made, practice using hand tools and try on the head-to-toe gowns that technicians wear.

More than 680 students have enrolled in the program since it began in July, said Leah Palmer, the executive director of the Arizona Advanced Manufacturing Institute at Mesa Community College. The program is free for in-state students who complete it and pass a certification test.

Micron, which has pledge to invest $100B over the next 20 years to build a chip fab complex in New York, is training veterans and teaching middle and high school students about STEM careers through “chip camps.”