UK moots chip body ahead of delayed semiconductor strategy

A research project aimed at finding new ways to support the UK’s semiconductor industry and the possibility of a ‘national institution’ were announced this week by the UK government’s Department for Digital, Culture, Media and Sport.

The move comes two years after the DCMS first promised a detailed strategy outlining the UK’s semiconductor industry which, it assured this week, was still forthcoming.

During this two-year period, a global chip shortage caused by the pandemic and exacerbated by tensions between Russia and China has hit sectors such as the car, defence, consumer electronics and clean energy particularly hard.

The Biden administration has eased the path in the US this summer, with The CHIPs and Science Act, creating almost three billion dollars’ worth of incentives to produce semi-conductors on home soil.

Prior to this in February, the EU launched a €43 billion euro plan to combat chip shortages.

Under pressure from a House of Commons committee – which last month urged the DCMS to give the UK semiconductor industry an indication of its future – yesterday the department launched what some might view as a placatory offering.

It’s a study which will look into how to grow chip design start-ups so that they might become the next Arm (one of the many UK firms, incidentally, to have warned about the chip shortage over the past two years).

The government is putting forward a budget of £700,000 – £900,000 for those looking to take on the study.

According to the DCMS press statement, the study will also explore whether better access to prototyping and manufacturing facilities for chip firms is needed to tackle barriers to innovation and to grow the industry.

Opportunities to make specialist software tools more available for start-ups will also be explored, as will ways to develop cutting-edge packaging processes.

The DCMS also announced in its statement that a new national institution could also be established as part of plans to boost the infrastructure underpinning the UK’s industry.

In the government press release digital secretary, Michelle Donelan praised the UK chip industry for its first-class design and research.

She said: “We want to build on these successes and keep our semiconductor sector on the cutting edge. This study will help us meet our ambition and could lead to a new national institution and greater research facilities.”

However, the measures don’t address supply chain vulnerabilities Britain and the rest of the world are facing, and, as the House of Commons Committee report last month noted, what the sector really needed – besides the strategy – was international collaboration.

It stated: “The UK is missing out on inward investment at a crucial time for the semiconductor industry, and we are competing with other countries. The Government should be more proactive in seeking to secure partnerships with US and EU counterparts and engage with Taiwanese and other major companies to secure significant inward investment in the UK.”