Over the last couple of years, a great deal of concern has developed around the future of semiconductor manufacturing, both with respect to total capacity and where the next generation of fabs will be hosted. The current chip crunch has underscored that current fab capacity is too small for a world where there’s a silicon chip in practically everything, and meanwhile geopolitical matters have made nations increasingly worried about where today’s cutting-edge fabs are located – mostly in Taiwan and South Korea. Consequently, we’ve seen governments kick-start initiatives to woo fab companies or otherwise incentivize the domestic construction of next-generation fabs, including the United States Department of Defense, whom today is awarding Intel an agreement to provide commercial foundry services for the DoD.

As announced by Intel this morning, Intel’s Foundry Services group has secured an agreement with the United States Department of Defense to provide fab services under the Rapid Assured Microelectronics Prototypes - Commercial (RAMP-C) program. RAMP-C is one of several US government programs to encourage domestic chip production, with this program focused on chip production for defense needs. In short, the DoD wants to ensure it will be able to have its chips (and other necessary commercial hardware) fabbed within the United States on a leading-edge commercial manufacturing node, and it is tapping a consortium of companies lead by Intel to develop the necessary foundry ecosystem.

Along with Intel, the consortium also includes IBM, Cadence, Synopsys and other companies, all of whom will be providing their relevant expertise and technologies to the project. These companies will be working together on what’s a fairly forward-looking service agreement, as the DoD is looking at fab needs several years down the line.  Ultimately, the group is being tasked with establishing a semiconductor IP ecosystem around Intel’s forthcoming 18A process – the most advanced process on their development roadmap – which isn’t due to start ramping until 2025.

At this point Intel and the DoD are not announcing the value of the services agreement. There is no doubt some hedging going on, and there are multiple milestones Intel & co will need to hit between now and 2025 as part of their participating in the RAMP-C program.

But in the meantime, even being able to claim the DoD as a major customer for Intel Foundry Services is a big win for the group, which is still in the early stages of lining up customers and proving that it has learned from past mistakes, both with regards to offering contract foundry services, and in operating a leading-edge fab ecosystem. As a reminder, Intel has previously announced that it will be spending around $20 billion to build a pair of new fabs in Arizona, so success for IFS hinges on finding big customers like the DoD to fill those fabs with orders.

Source: Intel

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  • Lord of the Bored - Tuesday, August 24, 2021 - link

    Bad CEO and board. I've not seen external politios cited as a reason for Intel's woes, they just pulled a Boeing and shot themselves in the foot repeatedly. Reply
  • Samus - Thursday, August 26, 2021 - link

    It's amazing what bad leadership and management (CEO & BoD) can do to a company. Just ask HP. Reply
  • FullmetalTitan - Thursday, August 26, 2021 - link

    Three words:
    Management
    Management
    Management
    Reply
  • danjw - Monday, August 30, 2021 - link

    Intel's problems come from putting business people in charge of an engineering company. Reply
  • Oxford Guy - Monday, August 23, 2021 - link

    The corporate-government complex wasn’t invented yesterday.

    This is how it is.
    Reply
  • Speedfriend - Monday, August 23, 2021 - link

    You dont think perhaps that there are devices that the DoD would order in the millions.. Reply
  • flgt - Monday, August 23, 2021 - link

    I don’t know the answer to that question but the fact we’re having this discussion points to insignificance of defense acquisition to commercial companies. It’s not a major driver in their decision making based solely on market opportunities. They’re going to have to come at them with a big carrot or a big stick. Reply
  • danjw - Monday, August 30, 2021 - link

    Both TSMC and Global Foundries are building new fabs in the United States. They are doing this because of government subsidies to do so. It isn't just the DoD that is worried about access to silicone that is made in the US. The fact that factories are stalled all over the country from making automobiles is concerning to much the the US government. But, the DoD has LOTS of money to through around. The DoD makes up about 1/6 of the federal budget, according to the CBO. That is a lot of money to throw at problems, it is also the area that is most likely to get what it wants out of Congress.

    This isn't just a US thing, the EU is concerned as well. They are trying to promote new fabs there as well.
    Reply
  • TeXWiller - Monday, August 23, 2021 - link

    Looking from the software side of things, DoD has been pursuing COTS angles where ever possible to cut the costs over the recent decades. As I'm looking at these political tensions from the outside and avoid reading certain publications, I don't get exposed to the fearmongering related to these geopolitical issues though.
    The issue of increasingly impatient China aside, there is still the oldest and the original reason for the global distribution of semiconductor manufacturing capability, that is the nature itself who doesn't care about our ideologies, nationalities or aspirations.
    Reply
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