UK commits £1 billion to chip development

National Semiconductor Strategy focuses on R&D

The UK government has announced the National Semiconductor Strategy, focusing on the country's existing strengths of chip design, R&D and compound semiconductors.

The Strategy's three main objectives are to grow the domestic chip sector; mitigate the risk of supply chain disruptions; and protect national security.

Among the key points is the commitment of £1 billion of investment over the next decade. It will be used to improve the talent pipeline and make it easier for British firms to access things like prototyping, tools and business support.

£1 billion sounds like plenty, but it compares poorly to the $52 billion in the USA's CHIPS Act, or €43 billion ($46.5 billion) in the EU Chips Act.

Part of the money will go towards the new National Semiconductor Infrastructure Initiative. This will examine areas like access to prototyping facilities, and increasing the availability of specialist software tools for startups.

£200 million of the £1 billion will come in 2023-25, to improve industry access to infrastructure, power more R&D and facilitate international cooperation.

Japan will be a focus of that cooperation. This week the country committed to strengthening its own chip industry, promising several million dollars to firms who build presence there.

The UK and Japan committed to establishing a semiconductor partnership at a G7 meeting in Hiroshima this week, which seeks to deliver new R&D cooperation, skills exchanges, and to improve the resilience of both countries' semiconductor supply chains.

As a first stage, UK Research and Innovation will work with the Japan Science and Technology Agency on a joint investment of up to £2 million in early stage semiconductor research next year.

The government also announced a UK Semiconductor Advisory Panel, to speak to government on behalf of the UK chip sector. However, so far there is no news on which companies or individuals will be represented on the body, aside from co-chair Dr Jalal Bagherli.

Industry reacts

On the whole, the industry has been cautiously optimistic about the new announcement, but did sound some warning notes.

Scott White, founder and executive director of strategic initiatives at Cambridge-based Pragmatic Semiconductor, welcomed the R&D investment and was "pleased" to see references to flexible semiconductor devices, calling it "an area where the UK can truly lead the world."

However, White also said further clarity was needed around exactly what the £1 billion will be applied to.

"When you look at the areas the UK is focused on there is a valid question to be asked over whether that's enough money to make a difference - is it too much of a dilution to spread the amount over 10 years? That can only be answered with more detail.

"Ultimately, you could invest £100 million annually into something that really moves the needle for the industry. You could equally waste £1 billion in a year by focusing it on areas that won't have an impact."

Amanda Brock, CEO of OpenUK (and a speaker at this year's Women in Tech Festival), told Computing that the £1 billion was a good start, but may be too diluted to make a difference.

"We need to see faster action behind bigger numbers to achieve the goal," she said. "As [Prime Minister] Sunak acknowledges, the UK is a world leader in design and research in semiconductors, but it must now build the bricks of a semiconductor manufacturing sector to, as Sunak says, 'cement the UK's status.'

"Until the UK has all of those building blocks in place, either in-country or as part of established semiconductor supply chains that will involve the UK as a principal supplier, it will not be close to being the global science and technology superpower he is seeking."

Arm CEO Rene Haas was more optimistic, saying the Strategy "will support the UK's effort to play a part in global supply chains for next generation technology.

"The UK is a significant hub of innovation and talent both for Arm and the wider industry and we look forward to working with the government and other partners to help make this a reality."