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How SMIC, China’s Semiconductor Champion, Landed in the Heart of a Tech War

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Efforts by the Beijing-backed Semiconductor Manufacturing International Corporation, or SMIC, to break through innovation barriers have landed it in a geopolitical tech battle.In a sprawling factory in eastern Shanghai, where marshy plains have long since been converted into industrial parks, China’s most advanced chipmaker has been hard at work testing the limits of U.S. authority.Semiconductor Manufacturing International Corporation, or SMIC, is manufacturing chips with features less than one-15,000th of the thickness of a sheet of paper. The chips pack together enough computing power to create advancements like artificial intelligence and 5G networks.It’s a feat that has been achieved by just a few companies globally — and one that has landed SMIC in the middle of a crucial geopolitical rivalry. U.S. officials say such advanced chip technology is central not just to commercial businesses but also to military superiority. They have been fighting to keep it out of Chinese hands, by barring China from buying both the world’s most cutting-edge chips and the machinery to make them.Whether China can advance and outrace the United States technologically now hinges on SMIC, a partly state-backed company that is the sole maker of advanced chips in the country and has become its de facto national semiconductor champion. SMIC pumps out millions of chips a month for other companies that design them, such as Huawei, the Chinese technology firm under U.S. sanctions, as well as American firms like Qualcomm.So far, SMIC hasn’t been able to produce chips as advanced as those of rivals such as Taiwan Semiconductor Manufacturing Company in Taiwan, or others in South Korea and the United States. But it is racing forward with a new A.I. chip for Huawei called the Ascend 910C, which is expected to be released this year.Huawei’s chip is not as fast or sophisticated as the coveted processors from Nvidia, the U.S. chip giant, which the White House has banned for sale in China. SMIC can also most likely make only a small fraction of what Chinese firms want to buy, experts said.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    A.I. Is Helping to Launch New Businesses

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    Entrepreneurs say use of artificial intelligence for a variety of tasks is accelerating the path to hiring and, ideally, profitability.Sean Ammirati has been teaching a class on entrepreneurship for more than a decade.A professor at Carnegie Mellon University, Mr. Ammirati has groups of mostly graduate students start businesses from scratch over the course of the spring semester. Some of the start-ups that his 49 students created this year were classic examples of the form: a dating app for couples in long-distance relationships, a personalized fitness app.But Mr. Ammirati also noticed something unusual.“I have a pretty good sense how fast the progress that students should make in a semester should be,” he said. “In 14 years, I’ve never seen students make the kind of progress that they made this year.”And he knew exactly why that was the case. For the first time, Mr. Ammirati had encouraged his students to use generative artificial intelligence as part of their process — “think of generative A.I as your co-founder,” he recalled telling them.The students began sharing their ideas for use cases on a dedicated Slack channel. They used generative A.I. tools such ChatGPT, GitHub Copilot and FlowiseAI to help them with tasks including marketing, coding, product development and recruitment of early customers.By the end of the class in May, venture capitalists were descending on Carnegie Mellon’s campus in Pittsburgh.“It felt to me like what I felt like in the mid-2000s, when cloud and mobile happened at the same time,” said Mr. Ammirati, who is himself an entrepreneur. Generative A.I., he believed, could similarly change innovation “by an order of magnitude.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    U.S. Economy: Has an Era of Increased Productivity Returned?

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    Thirty years ago, the U.S. entered an era of productivity gains that enabled healthy growth. Experts are asking if it could happen again.The last time the American economy was posting surprising economic growth numbers amid rapid wage gains and moderating inflation, Ace of Base and All-4-One topped the Billboard charts and denim overalls were in vogue.Thirty years ago, officials at the Federal Reserve were hotly debating whether the economy could continue to chug along so vigorously without spurring a pickup in inflation. And back in 1994, it turned out that it could, thanks to one key ingredient: productivity.Now, official productivity data are showing a big pickup for the first time in years. The data have been volatile since the start of the pandemic, but with the dawn of new technologies like artificial intelligence and the embrace of hybrid work setups, some economists are asking whether the recent gains might be real — and whether they can turn into a lasting boom.If the answer is yes, it would have huge implications for the U.S. economy. Improved productivity would mean that firms could create more product per worker. And a steady pickup in productivity could allow the economy to take off in a healthy way. More productive companies are able to pay better wages without having to raise prices or sacrifice profits.Several of the trends in place today have parallels with what was happening in 1994 — but the differences explain why many economists are not ready to declare a turning point just yet.The Computer Age vs. the Zoom AgeBy the end of the 1980s, computers had been around for decades but had not yet generated big gains to productivity — what has come to be known as the productivity paradox. The economist Robert Solow famously said in 1987, “You can see the computer age everywhere but in the productivity statistics.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Nature Has Value. Could We Literally Invest in It?

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    “Natural asset companies” would put a market price on improving ecosystems, rather than on destroying them.Picture this: You own a few hundred acres near a growing town that your family has been farming for generations. Turning a profit has gotten harder, and none of your children want to take it over. You don’t want to sell the land; you love the open space, the flora and fauna it hosts. But offers from developers who would turn it into subdivisions or strip malls seem increasingly tempting.One day, a land broker mentions an idea. How about granting a long-term lease to a company that values your property for the same reasons you do: long walks through tall grass, the calls of migrating birds, the way it keeps the air and water clean.It sounds like a scam. Or charity. In fact, it’s an approach backed by hardheaded investors who think nature has an intrinsic value that can provide them with a return down the road — and in the meantime, they would be happy to hold shares of the new company on their balance sheets.Such a company doesn’t yet exist. But the idea has gained traction among environmentalists, money managers and philanthropists who believe that nature won’t be adequately protected unless it is assigned a value in the market — whether or not that asset generates dividends through a monetizable use.The concept almost hit the big time when the Securities and Exchange Commission was considering a proposal from the New York Stock Exchange to list these “natural asset companies” for public trading. But after a wave of fierce opposition from right-wing groups and Republican politicians, and even conservationists wary of Wall Street, in mid-January the exchange pulled the plug.That doesn’t mean natural asset companies are going away; their proponents are working on prototypes in the private markets to build out the model. And even if this concept doesn’t take off, it’s part of a larger movement motivated by the belief that if natural riches are to be preserved, they must have a price.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Hottest Job in Corporate America? The Executive in Charge of A.I.

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    Many feared that artificial intelligence would kill jobs. But hospitals, insurance companies and others are creating roles to navigate and harness the disruptive technology.In September, the Mayo Clinic in Arizona created a first-of-its-kind job at the hospital system: chief artificial intelligence officer.Doctors at the Arizona site, which has facilities in Phoenix and Scottsdale, had experimented with A.I. for years. But after ChatGPT’s release in 2022 and an ensuing frenzy over the technology, the hospital decided it needed to work more with A.I. and find someone to coordinate the efforts.So executives appointed Dr. Bhavik Patel, a radiologist who specializes in A.I., to the new job. Dr. Patel has since piloted a new A.I. model that could help speed up the diagnosis of a rare heart disease by looking for hidden data in ultrasounds.“We’re really trying to foster some of these data and A.I. capabilities throughout every department, every division, every work group,” said Dr. Richard Gray, the chief executive of the Mayo Clinic in Arizona. The chief A.I. officer role was hatched because “it helps to have a coordinating function with the depth of expertise.”Many people have long feared that A.I. would kill jobs. But a boom in the technology has instead spurred law firms, hospitals, insurance companies, government agencies and universities to create what has become the hottest new role in corporate America and beyond: the senior executive in charge of A.I.The Equifax credit bureau, the manufacturer Ashley Furniture and law firms such as Eversheds Sutherland have appointed A.I. executives over the past year. In December, The New York Times named an editorial director of A.I. initiatives. And more than 400 federal departments and agencies looked for chief A.I. officers last year to comply with an executive order by President Biden that created safeguards for the technology.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber?  More

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    A Push for Tech Hubs in Overlooked Places Picks 31 to Vie for Money

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    A new federal program will be a test of whether spreading funds outside of big cities will result in economic gains, or in inefficiencies.The Biden administration said on Monday that it had chosen 31 regions as potential recipients of federal money that would seek to fund innovation in parts of the country that government investment overlooked in the past.The announcement was the first phase of a program that aims to establish so-called tech hubs around the country across a variety of cutting-edge industries, like quantum computing, precision medicine and clean energy. In the coming months, the regions will compete for a share of $500 million, with roughly five to 10 of the projects receiving up to about $75 million each, the administration said.The program will test a central idea of a bipartisan bill that lawmakers passed last year: that science and technology funding should not just be concentrated in Silicon Valley and a few thriving coastal regions but flow to parts of the country that are less populated or have historically received less government funding.Proponents of the program say these investments can tap into pools of workers and economic resources that are not reaching their full potential, and improve the American economy as well as its technological abilities.But it remains to be seen if dispatching money to more remote places, which struggle with issues like an outflow of young workers, will ultimately be the most efficient way to use government funding to promote technological gains.The 31 finalists were chosen from nearly 400 applicants, the Commerce Department said. They include proposals to manufacture semiconductors in New York and Oregon, design autonomous systems for transportation and agriculture in Oklahoma, research biotechnology in Indiana and process critical minerals in Missouri.In Washington on Monday, President Biden said these tech hubs would bring together private industry, educational institutions, state and local governments, tribes, and organized labor to produce “transformational” research.“We’re doing this from coast to coast, and in the heartland and red states and blue states, small towns, cities of all sizes,” Mr. Biden added. “All this is part of my strategy to invest in America and invest in Americans.”Senator Chuck Schumer of New York, the majority leader, said in an interview on Monday that the tech hub program, which he had devised with Senator Todd Young, an Indiana Republican, had helped to secure bipartisan support for the CHIPS and Science Act last year.The legislation included $200 billion for basic scientific research, and more than $75 billion in grants and tax credits for semiconductor companies. It aimed to lower the country’s dependence on foreign manufacturers of computer chips and other critical technology.Mr. Schumer said “it was a very big selling point” for the overall bill that the funding was not just going to “three or four cities in blue states.”“There was such divisiveness in the country, the coasts and non-coasts, and a lot of it was because all these new tech and high-end industries were locating on the coasts,” he said. “And so we crafted the tech hub program to be spread throughout the middle of America.”Mr. Schumer was touring Buffalo, Rochester and Syracuse on Monday to celebrate the inclusion of two New York proposals, one focused on semiconductor manufacturing and the other on battery technology.“There’s a lot of talent here that’s not used,” he added.Mark Muro, a senior fellow at the Brookings Institution’s Metropolitan Policy Program, described the tech hub program as “a grand experiment” in industrial policy.Mr. Muro said the United States had seen the incredible strength of concentrating technology investments in a few key places like Silicon Valley, where companies in related businesses can benefit by clustering together. But those investment patterns have also resulted in tremendous imbalances in the country’s economy, where “only a few places are truly prospering and much talent and much innovation is left on the table,” he said.“This is a whole different map,” Mr. Muro said, adding, “I think we need to make some experiments and some of them will probably be great investments.”The announcements tried to balance several competing goals of the tech hubs, including whether to invest in as many regions as possible — or whether to concentrate spending in a few areas in hopes of engineering radical economic improvement in those areas. They also reflected the high interest in the program from regional officials and their representatives in Congress.The administration is also trying to do as much as possible with initial funding for the program that remains well below the maximum levels lawmakers set in the CHIPS bill. While that bill authorized Congress to fund a variety of programs, lawmakers still need to greenlight actual money for many of the tech hub investments, as well as other programs.Given those financial constraints, some supporters of the program said on Monday that they hoped administration officials would ultimately focus most of the money on a small set of the announced hubs. Ideally, “you’d be extremely narrow about who gets funding,” said John Lettieri, president and chief executive of the Economic Innovation Group, a Washington think tank. “The more narrow the better.”The later round of funding announcements, he added, “is where we have to be pretty ruthless about shielding the process from politics as much as possible.”Madeleine Ngo More

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    Indiana Tests if the Heartland Can Transform Into a Chip Hub

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    Over the past 14 months, Indiana began converting 10,000 acres of corn and bean fields into an innovation park. State leaders met with the chief executives of semiconductor giants in South Korea, Taiwan and Japan. And they hosted top Biden administration officials to show off a $100 million expansion of chip research and development facilities at a local university.The actions were driven by one main goal: to turn Indiana into a microchip manufacturing and research hub, almost from scratch.“We’ve never done anything at this scale,” said Brad Chambers, who was Indiana’s commerce secretary in charge of economic development. “It’s a multibillion-dollar commitment by the state to be ready for the transitions that are happening in our global economy.”“We’ve never done anything at this scale,” said Brad Chambers, Indiana’s commerce secretary.Kaiti Sullivan for The New York TimesIndiana’s moves are a test of the Biden administration’s efforts to stimulate regional economies through the $52 billion CHIPS and Science Act, a landmark package of funding that is planned to begin going out the door in the next few months. The program is intended to bolster domestic manufacturing and research of semiconductors, which act as the brains of computers and other products and have become central to the U.S. battle with China for tech primacy.The Biden administration has promised that the CHIPS Act will seed high-paying tech jobs and start-ups even in places with little foundation in the tech industry. In a speech in May last year, Commerce Secretary Gina Raimondo, who oversees the chips program, said she was looking at how the program would help “different places in the heartland of America.”She added, “I think we will really unleash an unbelievable torrent of entrepreneurship and capital opportunity.”Gina Raimondo, the U.S. secretary of commerce, is overseeing the CHIPS Act program. Jared Soares for The New York TimesThat makes Indiana a prime case study for whether the administration’s efforts will pan out. Unlike Arizona and Texas, which have long had chip-making plants, Indiana has little experience with the complicated manufacturing processes underlying the components, beyond electric vehicle battery manufacturing and some defense technology projects that involve semiconductors.Indiana now wants to catch up to other places that have landed big chip manufacturing plants. The push is supported by Senator Todd Young, a Republican from Indiana, who was a co-author on the CHIPS Act and has been a leading voice on increasing funds for tech hubs. Companies and universities in Indiana have applied for multiple CHIPS Act grants, with the aim of winning awards not only for chip manufacturing but also for research and development.Some economists said the Biden administration’s goals of turning farmland into advanced chip factories might be overly ambitious. It took decades for Silicon Valley and the Boston tech corridor to thrive. Those regions succeeded because of their strong academic research universities, big anchor companies, skilled workers and investors.Many other areas don’t have that combination of assets. Indiana has for decades faced a brain drain among some of its more educated young people who flock to larger cities for work, according to the Indiana Chamber of Commerce. Some industrial policy proponents see the investments as a way to reverse that exodus, as well as a broader trend toward deindustrialization that hollowed out communities in the Rust Belt.But it’s unclear whether the program can achieve such ambitious goals — or whether the Biden administration will judge it to be more effective to spread out investments around the country or concentrate them in a few key hubs.“Many pieces have to come together,” said Mark Muro, a senior fellow at the Brookings Institution. He added that the federal government’s plan to initially put $500 million into tech hubs was too small and estimated it would take $100 billion in government aid to create 10 sustainable tech hubs.Indiana does have some advantages. The state has ample land and water — which are necessary for large chip factories that use water to cool equipment and rinse silicon wafers — and it has relatively stable weather for the highly sensitive production process. It also has Purdue University, with an engineering school that has promised to turn out the technicians and researchers needed for chip production.Yet the state faces stiff competition. In January 2022, Indiana lost a bidding war to Ohio over plans by Intel, the big U.S. chip-maker, to build two factories valued at $20 billion.“We learned a lot of lessons,” Mr. Chambers said about the failure. The biggest, he said, was to have a more attractive package of land, infrastructure and work force programs ready to offer big chip companies.A year later, Indiana won a $1.8 billion investment from SkyWater, a Minneapolis-based chip-maker, to build a factory with 750 jobs adjacent to Purdue’s campus.SkyWater, a Minneapolis-based chip maker, plans to invest $1.8 billion in a factory in Indiana. SkyWaterIndiana beat out four other states vying for SkyWater’s chip facility.SkyWaterState leaders acknowledge that any tech transformation could take years, especially if there is no anchor plant by even larger chip manufacturers such as TSMC, the world’s biggest maker of cutting-edge chips.Mr. Young said he and other state leaders were in talks with big chip makers for a contract that would compare to the $20 billion that Intel committed to Ohio. But “all net new job creation in my lifetime has been created by new firms and young firms,” he said.Indiana’s chip-making metamorphosis is now centered on a tech park, LEAP Innovation District, in the town of Lebanon near Interstate 65, which connects Indianapolis and Purdue in West Lafayette. The town is surrounded by 15,000 square miles of corn and bean farms.The park began taking shape along with the CHIPS Act. In 2019, Mr. Young was a co-author of the Endless Frontier Act with Senator Chuck Schumer, a Democrat of New York and then the Senate minority leader. The bill was the precursor to the CHIPS Act.As the bill wound through Congress, Mr. Young was in regular contact with Eric Holcomb, Indiana’s governor, and Mitch Daniels, then Purdue’s president, on details of the proposal. Mr. Young said Indiana’s manufacturing roots would be its asset, if the state’s factory sector could transition to making advanced chips.“I realized that Indiana and, more broadly, the heartland stood to disproportionately benefit from the investments that we would be making,” he said in an interview last month.Mr. Holcomb and Mr. Chambers then created a plan for a tech manufacturing park. Within months, they began buying corn and bean farms in Lebanon for what became the LEAP Innovation District.In September, Ms. Raimondo and Secretary of State Antony Blinken toured Purdue University’s clean rooms, seen here, for chip research.Kaiti Sullivan for The New York TimesPurdue is also working on a $100 million expansion of semiconductor research and development.Kaiti Sullivan for The New York TimesIn May 2022, Mr. Holcomb unveiled LEAP and began installing new water and power lines and a new road there. Mr. Holcomb, Mr. Chambers and Mr. Young also traveled to more than a dozen countries to meet with the executives of chip companies like SK Hynix and TSMC. They offered cheap rent in the LEAP district, tax incentives, access to labs and researchers at Purdue, and training programs at the local Ivy Tech Community College.Some of the work paid off. When Indiana beat out four other states for SkyWater’s $1.8 billion chip facility, the company said it was impressed by the coordination between state leaders and Purdue’s new president, Mung Chiang, who launched the nation’s first semiconductor degree programs to nurture workers for chip makers.Mung Chiang, Purdue University’s president, has rolled out a semiconductor degree program to nurture chip workers. Kaiti Sullivan for The New York TimesIn September, Mr. Chiang invited Ms. Raimondo and Secretary of State Antony J. Blinken to tour Purdue’s clean rooms for chip research and to see plans for a $100 million expansion of semiconductor research and development, including 50 new faculty to work on advanced chip science.“I think you have all the ingredients,” Ms. Raimondo said in a discussion with Mr. Holcomb and Mr. Chiang during the visit. Indiana officials now await word on how much CHIPS Act funding they may get. Some early results from the LEAP district initiative offer a mixed picture of where things might go.In May 2022, the park landed its first tenant — Eli Lilly, the pharmaceutical company, not a chip maker. More

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    Silicon Valley Chosen for $4 Billion Chip Research Center

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    Anticipating federal subsidies, Applied Materials said it planned to invest up to $4 billion in the semiconductor project in Sunnyvale, Calif.Silicon Valley got its name from computer chips, but no longer plays a central role in shaping how they are made. A major supplier to the industry hopes to change that.Applied Materials, the biggest maker of machines for producing semiconductors, said on Monday that it planned to build a massive research facility near its hometown, Santa Clara, Calif., to allow chip makers and universities to collaborate on advances to make more powerful chips. Silicon Valley hasn’t seen a comparable semiconductor construction project in more than 30 years, industry analysts say.The company expects to invest up to $4 billion in the project over seven years, with a portion of that money coming from federal subsidies, while creating up to 2,000 engineering jobs.The plan is the latest in a string of chip-related projects spurred by the CHIPs Act, a $52 billion package of subsidies that Congress passed last year to reduce U.S. dependence on Asian factories for the critical components. What sets Applied Materials’ move apart is that it focuses on research, rather than manufacturing, and is a substantial new commitment to the industry’s original hub.Chip makers that grew up in Silicon Valley have long chosen to build new “fabs,” the sophisticated factories that fabricate chips from silicon wafers, in less costly states and countries. But Applied Materials is betting that technical talent at nearby universities and the local companies that design chips will spur innovation quickly, making up for cost differences with other locations.“You can connect more leaders in this ecosystem here than anyplace in the world,” said Gary Dickerson, the chief executive of Applied Materials. “There’s no place like this.”Applied Materials has scheduled an event on Monday in Sunnyvale, Calif., to discuss the project, with expected guests including Vice President Kamala Harris.Politicians from both parties overwhelmingly supported the CHIPs Act, partly out of fears that China will one day exert control over Taiwan and factories there that produce the most advanced chips. Besides encouraging domestic chip manufacturing, the legislation allocated about $11 billion to spur related research and development.Chip research now takes place in several phases in multiple locations, including university labs and collaborative centers such as the Albany NanoTech Complex in New York. Applied Materials participates with other companies in that center and operates a research fab in Silicon Valley where chip makers can work with its machines and those of other toolmakers.But many of the core chores in developing new production processes are carried out by chip manufacturers in fabs outfitted with a broad array of equipment. The proposed center, which Applied Materials calls Epic, is set to have ultraclean production space bigger than three football fields and is designed to give university researchers and other engineers comparable resources to experiment with new materials and techniques for creating advanced chips.One goal is to reduce the time it takes for new ideas to flow from the research labs to companies designing new manufacturing gear, information that is now often delayed as it is filtered through the chip makers.“The trouble is, those customers need time to figure out what they need,” said H.-S. Philip Wong, a Stanford professor of electrical engineering who was briefed on the company’s plans. “There is a big hole in there.”Applied Materials also said chip makers would be able to reserve space in the center and try out new tools before they were commercially available.The plan hinges partly on whether Applied Materials can win subsidies under the CHIPs Act, which the Commerce Department says has already attracted expressions of interest from more than 300 companies. Mr. Dickerson said that the company planned to build the center in any case, but that government funding could affect the project’s scale.Assuming the center evolves as planned, it could substantially bolster Silicon Valley’s role in the evolution of chips, said G. Dan Hutcheson, vice chair at the market research firm TechInsights.“It really is a vote of confidence for the Valley,” he said. More

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    Commerce Dept. Outlines Its Bid to Fund Cutting-Edge Chip Research

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    The Biden administration announced its strategy for the National Semiconductor Technology Center, a string of facilities aimed at propelling U.S. innovation.WASHINGTON — The Biden administration outlined plans on Tuesday to propel research on the type of cutting-edge microchips needed to power computers, cars and other devices, saying it would establish a new national organization with locations in various parts of the United States.The Commerce Department, which is in charge of the administration’s efforts to revitalize the American chip industry, said its new National Semiconductor Technology Center would bring together companies, universities and others to collaborate on next-generation chip technology. The organization would include a string of research centers, the locations of which have yet to be chosen, and aim to be operational by the end of this year.The organization would help “regain America’s leadership in research and development and technologies of the future, and importantly, make sure we stay there for decades to come,” Gina Raimondo, the commerce secretary, said in a briefing Monday.“It’s a place where industry and academia and start-ups and investors can come together to solve the biggest, grandest challenges and set priorities,” she added.The plans are part of the Biden administration’s effort to reinvigorate semiconductor manufacturing and ensure that the United States has a steady supply of chips necessary to feed its factories and support its national defense. The Commerce Department has been charged with doling out $50 billion to revitalize the industry, including $11 billion devoted to research and development.The technology center is expected to be central to that effort. Some of its locations would be capable of end-to-end manufacturing of new chip designs, while others would focus on experimenting with new materials and equipment, or with new ways of putting chips together to make them more powerful, Ms. Raimondo said.Laurie Giandomenico, the vice president and chief acceleration officer of MITRE, a nonprofit organization that operates federally funded research centers, called the $11 billion investment by the United States “pretty significant,” given that the semiconductor industry has in past years spent about $70 billion on research and development globally.The challenge, she said, would be to ensure that the money was spent to encourage collaborative research to solve the industry’s biggest problems, not the “siloed innovation” now carried out by chip firms that carefully guard their creations from competitors.“It should be on areas that no one company can solve alone,” she said.Companies, universities, lawmakers and local governments have been lobbying the administration to set up an outpost of the new organization in their area. Ms. Raimondo emphasized that the organization would be an independent “trusted” player, with board members appointed by a separate selection committee and strict controls for protecting intellectual property.One of the organization’s primary goals, Ms. Raimondo said, would be making it easier and less expensive for start-ups and other new entrants to develop and commercialize new chip technologies.“We want to cut in half the projected cost of moving a new chip from concept to commercialization over the next decade,” she said.Chris Miller, the author of “Chip War,” which chronicles the industry’s development, said it was comparatively easy for a researcher to develop a new idea for a chip in a laboratory. But given the high cost of producing chips, researchers can have a hard time getting their inventions manufactured.Designing an advanced chip, which may have tens of billions of transistors, can cost hundreds of millions of dollars, according to analysts. The latest systems for defining the smallest circuitry on wafers cost more than $100 million each, while the new factories called “fabs” that make advanced chips can cost $10 billion to $20 billion.“The big fabs are interested in producing 100 million chips for an iPhone, not 10 chips for a professor at M.I.T.,” Mr. Miller said.Venture capitalists also often shy away from investing in chip start-ups because they require more initial funding than other kinds of tech companies and more time to generate a return on that investment.To help address some of these issues, the government’s technology center will establish an investment fund to support start-ups, and provide manufacturing facilities for small players to experiment with new technologies.“I see a world where the U.S. can actually revitalize this microelectronics industry because we could bring down the costs of doing a chip start-up by a factor of five to a factor of ten,” said Gilman Louie, a tech investor and chief executive of a nonprofit investment organization called America’s Frontier Fund.The center’s research priorities are expected to be refined in the coming months. But the Commerce Department specified several areas it would focus on, including advancing the technology for analyzing the microscopic components of chips and setting technical standards for new kinds of chip packaging.As progress slows in squeezing ever-smaller transistors onto each piece of silicon, many companies are now breaking up big products into smaller “chiplets” that are placed side by side or stacked on top of one another.The Commerce Department said that setting new standards for these practices would pave the way for the creation of marketplaces in which companies can assemble new products using chiplets from multiple vendors. More