The Pentagon plans to award up to $280 million next year for Microelectronics Commons projects, according to a press release. Funding for the program supports six technology areas: secure edge and Internet of Things computing; 5G and 6G; AI hardware; quantum; electromagnetic warfare; and “leap-ahead” commercial technologies.

“The U.S. military has an ever-increasing need for innovation in the microelectronics that underpin many of our modern weapon systems, including communications equipment, planes, tanks, long-range munitions, and sensors. This Call for Proposals is the next step in our effort to bridge the valley of death from ‘lab-to-fab,’” Deputy Undersecretary of Defense for Research and Engineering David Honey said in a statement.

The term “valley of death,” in defense acquisition parlance, refers to challenges that are often encountered in transitioning promising technologies from research and development into production.

“Today, microelectronics designs that are proven within U.S. universities and businesses of all sizes frequently do not enter large-scale production because the transition from laboratory to fabrication is notoriously difficult; a high technology readiness does not mean high manufacturability. The Commons is focused on easing this transition for microelectronics that are essential for our national security,” according to the release. “The Commons aims to ensure that the U.S. defense industrial base will have access to a robust pipeline of world-leading microelectronics produced in U.S. foundries, and the ability to shape that pipeline to address the future demands of our warfighters.”

The initiative is supported by eight innovation hubs that were announced in September, which are intended to help scale production. They include the Northeast Regional Defense Tech Hub in New York; Southwest Advanced Prototyping Hub in Arizona; Commercial Leap Ahead for Wide-bandgap Semiconductors Hub in North Carolina; Silicon Crossroads Microelectronics Commons Hub in Indiana; Midwest Microelectronics Consortium Hub in Ohio; California Defense Ready Electronics and Microdevices Superhub; California-Pacific-Northwest Artificial Intelligence
Hardware Hub; and Northeast Microelectronics Coalition Hub in New England.

More than 380 organizations are part of the various hubs, including more than 100 academic institutions, according to the Pentagon.

Respondents to the solicitation must be members of the National Security Technology Accelerator and a Microelectronics Commons hub, according to the call for proposals.

The DOD plans to award prototype other transaction agreements for selected projects, which may lead to follow-on awards.

“Upon successful completion of this prototype effort, the Government anticipates that a follow-on production effort may be awarded via either contract or transaction, without the use of competitive procedures,” according to the solicitation.

Naval Surface Warfare Center, Crane Division is the contracting activity.

Responses are due Feb. 28, 2024. The Pentagon anticipates issuing awards in the third quarter of fiscal 2024.

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Microelectronics are critical components of U.S. military systems and other national security-related technologies, and they’re a top priority of the Pentagon’s research-and-engineering enterprise. The Large Area Device-quality Diamond Substrates (LADDIS) program, which falls under DARPA’s Microsystems Technology Office, is geared toward helping to create a U.S.-located commercial source for substrates that can be used in high-power and high-temperature microelectronics for Defense Department platforms and arrays.

Great Lakes Crystal Technologies, International FemtoScience, Penn State University Applied Research Laboratory, Advent Diamond, WD Lab Grown Diamonds, and Element Six have been tapped as performers for the effort, DARPA told DefenseScoop.

Officials say that diamond, as an ultra-wide bandgap semiconductor, can enable electronics to operate in harsh environments.

“Future DoD systems will require higher power and higher temperature electronics capable of withstanding extreme operating conditions. Whereas conventional electronics relying on Si, GaAs, or wide band-gap materials are limited in breakdown voltage, power handling, and operating temperature, diamond’s large bandgap and thermal conductivity can overcome these limitations. However, the lack of reproducible, large diameter, device quality diamond substrates has hindered the demonstration of electronics with higher breakdown voltage or current compared to existing technology,” according to a presolicitation for LADDIS.

“Diamond substrates today are small (5-10 mm square) and have high dislocation density (up to 10⁵ cm^-2), which degrades device performance and manufacturability. Commercially available substrates also have large variability in material quality, and previous attempts at wafer size scaling exhibited extremely high dislocation density (up to 10⁹ cm^-2) and cracking due to stress,” it explained.

Through LADDIS, the Pentagon aims to demonstrate approaches to fabricate device grade, large diameter, single crystal substrates. The initiative will also pursue new methods for polishing diamond surfaces with “low roughness and no subsurface defects” so they can be used in microelectronics devices.

The goal is to develop techniques for creating substrates with a diameter greater than 50 millimeters, dislocation density below 10³ cm^-2, surface roughness below 0.2 nanometers, and desirable electrical, thermal and mechanical properties.

In a press release last week, Element Six, part of the De Beers Group, announced that it was tapped for the project.

“Diamond-based semiconductors have the potential for unprecedented power density, speed, and performance; however, there is a lack of industrial-size single crystal diamond wafers that are needed to commercialize these ‘super-devices’. By working with its network of partners as part of the LADDIS project, Element Six will aim to overcome these challenges,” the company said in the release.

The two-phase program is expected to last 18 months, according to DARPA.

One of the vendors selected for the program, WD Lab Grown Diamonds, recently filed for bankruptcy, according to reports. On Nov. 1, Tree Line Capital Partners announced that it launched WD Advanced Materials, which a press release described as “a new entity focused on technical diamond applications and was formed following the transition from its predecessor gemstone manufacturing entity, WD Lab Grown Diamonds.” An official with the newly launched company told DefenseScoop that the bankruptcy filing by WB Lab Grown Diamonds won’t impact work on the LADDIS program.

Updated on Nov. 1, 2023 at 2:25 PM: This story has been updated to include additional information about recent developments with WD Lab Grown Diamonds and a new entity, WD Advanced Materials.

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Computer chips and microelectronics help power the military’s current and next-generation weapons systems and other crucial national security technologies. Historically, the U.S. has operated as a leader in the development of microelectronics globally. But according to a senior defense official, the nation has largely under-invested in the domestic production of such assets — so now, most are created overseas. 

“In fact, the U.S. relies on East Asia for about 75% of global production as of today,” a senior official told reporters on Tuesday ahead of Wednesday’s announcement about the initial awards for the program.

Backed by millions in funding including via the 2022 CHIPS and Science Act — and with roots tracing back to a requirement under the fiscal 2021 National Defense Authorization Act to establish a National Network for Microelectronics Research and Development — the DOD’s Microelectronics Commons program is meant to encompass a national web of hubs that connect direct pathways to commercialization from laboratory to fabrication, for microelectronics researchers and designers across America.

“The one-liner, if you like, is the ‘lab-to-fab.’ But behind that … what we’re doing is to ensure that for the foreseeable future, the department has a robust pipeline that delivers new world-leading microelectronics, that draws on the massive number of innovative organizations across the country and is focused on the department’s demanding specialized needs — and that builds both our workforce for developing those devices, but also the larger workforce outside of these hubs and such that … now knows how to do it,” the senior defense official told reporters. 

They added that it will be about “producing new tools, new software — just as we did originally, back in the” 1970s and ’80s, when the Pentagon through Defense Advanced Research Projects Agency (DARPA) facilitated massive investments and a deliberate push to bolster America’s then-limited silicon foundries.

During a press briefing at the Pentagon on Wednesday, Deputy Secretary of Defense Kathleen Hicks said the initiative will help the technology cross “that infamous valley of death between research and development and production. Because while America is a world leader in the innovative research and design of microelectronics, we’ve lagged in the ability to prototype, manufacture, and produce them at scale. That’s what the CHIPS Act is meant to supercharge.”

For the new Commons program, the DOD released a request for proposals and relevant solutions in late 2022.

The first awards, with a total value of nearly $240 million dollars, will go toward the following eight regional innovation hubs:

• In New York, where SUNY Polytechnic and its 51 hub members will launch
  the Northeast Regional Defense Tech Hub.

• In Arizona, where ASU and its 27 hub members will launch the Southwest
  Advanced Prototyping Hub.
• In North Carolina, where NC State and its seven hub members will launch
  the Commercial Leap Ahead for Wide-bandgap Semiconductors Hub.
• In Indiana, where the Applied Research Institute and its 130 hub members
  will launch the Silicon Crossroads Microelectronics Commons Hub.
• In Ohio, where the Midwest Microelectronics Consortium will launch a hub
  with its 65 members.
• In southern California, where USC and its 16 hub members will launch the
  California Defense Ready Electronics and Microdevices Superhub.
• In New England, where the Massachusetts Technology Collaborative and its
  90 hub members will launch the Northeast Microelectronics Coalition Hub.
• And in northern California, where Stanford, Cal Berkeley, and their 44 hub
  members will launch the California-Pacific-Northwest Artificial Intelligence
  Hardware Hub.

More than 360 different organizations were tapped to work via the hubs, which will provide the broader physical infrastructure, software tools and expertise needed to drive manufacturing and innovation.

Organizations that didn’t receive any of the initial awards will still have the opportunity to compete for opportunities that will open up over the next few years, Hicks noted.

The hubs in this new network will provide access to prototyping and development resources across six areas: electronic warfare; internet-of-things computing; artificial intelligence at the edge; quantum technology; 5G and 6G technology; and “leap-ahead” commercial technologies.

“Consistent with our warfighter-centric approach, the Microelectronics Commons will get the most cutting-edge microchips into systems our troops use every day: ships, planes, tanks, long-range munitions, communications gear, sensors, and much more, including the kinds of all-domain, attritable autonomous systems that we’ll be fielding through DoD’s recently-announced Replicator initiative,” Hicks said.

The Pentagon plans to spend about $2 billion over the next five years on the initiative, according to Deputy Undersecretary of Defense for Research and Engineering David Honey.

The senior defense official who briefed reporters on Tuesday said the first call for projects will go out in about a month.

“The areas of expertise [these hubs] are developing, or already have and are developing, are very much focused on the challenges that we have in the department. The projects that come through will be focused on a mix of the very near term and slightly longer term — we left it up. But the outcome of the central project will be something that can be taken to scale in a U.S.-based foundry,” the official told DefenseScoop during the press call. 

On Wednesday, Honey said: “Now that we have selected the hubs, which will provide the laboratory fab infrastructure for R&D and other innovative development projects, our next solicitation … will be the call for project solicitations, which is scheduled to occur very soon. And then each year in the third quarter of the fiscal year, there will be additional calls for projects as that gets released.”

Pentagon officials hope that these hubs will attract significant non-DOD business and become self-sufficient.

An organization does not need to be a member of a hub to submit a project topic. The hubs are also intended to serve as a resource for commercial users and other U.S. government organizations outside of the Commons program and outside the DOD. And organizations don’t need a DOD contract to leverage the hubs, Honey noted.

Hicks told DefenseScoop that the Pentagon is essentially putting out “needs statements” about the types of microelectronics the department wants.

“The Department of Defense is like any other consumer in the following way we consume microelectronics that are out on the commercial market. What Microelectronics Commons does is helps us inject into that system the specific needs that we have … We help to direct investment like we do anywhere else we put government R&D. That’s what we’re going to be able to do here is to drive with our dollars the specific investment areas we need. And then as a consumer out the other end of that, however it produces, if you will, the fact that we can get that out of United States manufacturing is more secure for our supply chain,” she said.

The hubs are meant to be part of the broader microelectronics ecosystem, she noted.

“At the end of that ecosystem are fabs, and the fabs actually are the ones that end up producing. We have fabs elsewhere in the world. We will still have those allied based fabs, if you will, but what we’re doing here is generating a lot more ingenuity in that fab process in the United States and gearing it up through these hubs with a lot of energy on the types of microelectronics, on the types of problem sets that we need those fabs to produce at the other end. And yes, then we will be purchasing them — what is produced out of U.S. fabs alongside, again, some that are located in allied countries,” she added.

Honey told DefenseScoop that the Pentagon’s R&E directorate will be informing other Defense Department components about what the hubs are up to.

“We will be educating the services, the folks who write the requirements on what’s going on in the Commons so that as they’re thinking about the future requirements that they’re going to establish [and] what the opportunities are for future weapons systems development, they’re aware of the state of the art, you know, what’s coming through the Commons so they can then set — if they choose to do so — they can set the expectations in future solicitations for the kind of capabilities that they want,” he said.

Officials hope the hubs help generate chips that are available for use in the next few years.

“My expectation is that you’ll probably see chips coming through this well before the five years when the program is over. We should already see, I’m guessing, product coming out and stuff that’s available for use,” Honey said.

The Pentagon is set to host its first annual Microelectronics Commons meeting in Washington Oct. 17-18, where more information will be shared and attendees will be able to engage DOD officials and all the hubs.

There will be “opportunity for anyone that’s interested in working in the hubs or working with the hubs or through the hubs to hear what’s available,” Honey said.

“Within each of the … six tech areas, there’s a lot of opportunity for developments that would benefit the DOD. And so the folks from the government team that will be there are those researchers and program managers who have experience in developing the weapons systems … What they’ll be doing at the unclassified level is sharing their insights and where they think the greatest opportunities are for innovation and development coming through the hubs that would lead to an advantage for our systems,” he added.

There’s also a website for those who are interested in the program.

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An annex to the EO on “Addressing United States Investments in Certain National Security Technologies and Products in Countries of Concern,” identifies the People’s Republic of China — including Hong Kong and Macau — as a country of concern.

Microelectronics are critical components of advanced weapon systems, while AI is seen as a key enabler of future autonomous weapon systems, intelligence capabilities, decision-making aids and other military use cases. Military applications of quantum technologies include quantum computing and quantum networks, atomic clocks for positioning navigation and timing, and quantum sensors.

The biggest changes in warfare in the coming decades could come from the rapid onset of artificial intelligence and quantum computing, according to Gen. Mark Milley, chairman of the Joint Chiefs of Staff.

“We will be able to see ourselves and see the enemy in much more significant ways than we can now. In fact, I would suggest that the combination of those two technologies alone would spell a tremendous change in the character of war,” he said in June at the National Press Club. “Artificial intelligence will be able to process complex information at speeds that no human mind can match. So our task, the United States’ task is for our military … to maintain our current decisive advantage, our lethality, our readiness, our competence, by optimizing these technologies for the conduct of war. And we do this not to conduct war, but to deter great power war.”

Biden’s executive order “will complement our existing export control and inbound investment screening tools with a ‘small yard, high fence’ approach to address the national security threat posed by countries of concern advancing such sensitive technologies,” a senior administration official told reporters during a call to preview the initiative before it was rolled out.

Officials say the controls are intended to be narrowly targeted toward tech with military or intelligence end uses.

“It’s important to recognize this is a national security action, not an economic one. We recognize that cross-border investment flows have long contributed to U.S. economic vitality. This executive order protects our national security interests … while maintaining our long-standing commitment to open investment,” a senior administration official said.

Another senior administration official told reporters: “The outbound investment mission is aligned with the mission of our export controls … but our export controls don’t cover investments abroad that can help foreign adversaries or countries of concern to fuel indigenous development of national security technologies. By adding outbound investment screening to our suite of national security tools, we’re enhancing U.S. capabilities to safeguard our national security.”

The Treasury Department is also releasing an advance notice of proposed rulemaking that will provide additional information related to Biden’s executive order. The administration is asking for feedback from industry and other stakeholders that will help shape the implementation of the new rules. The Commerce Department and other federal agencies had a hand in shaping the notice, according to administration officials.

The public will have 45 days after the notice’s publication in the Federal Register in which to provide comments that will inform draft regulatory text.

The program won’t come into force until the end of the rulemaking process, officials noted during the call with reporters.

The new rules are expected to include requirements that U.S. persons notify the Treasury Department of certain transactions, and a prohibition on U.S. persons undertaking certain other transactions.

“In both cases, we intend to apply the requirements to investments in any entity of a country of concern that is engaged in activities in a narrow subset of three advanced technology areas that have a national security nexus. We’re focused on the types of investments that can confer tangible benefits along with capital, such as private equity and venture capital investments, joint ventures, and greenfield investments, among others,” according to a senior administration official. The rules are not intended to cover “passive investments,” they noted.

The Treasury Department will have the authority to investigate violations of the executive order and the accompanying regulations and pursue penalties against violators, according to officials.

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The request is the department’s largest ever for S&T projects and marks an 8.3% increase over what was enacted by Congress in fiscal 2023, Undersecretary of Defense for Research and Engineering Heidi Shyu said during a webinar hosted by the National Defense Industrial Association. 

Science and technology is considered a critical component of the Defense Department’s research, development, test and evaluation budget. It includes funding for basic research, applied research and advanced technology development. 

Shyu noted that basic research across the department would increase by 4% from fiscal 2023 to around $2.5 billion. The Office of the Under Secretary of Defense for Research and Engineering would receive a 43% funding boost over last year, she said.

“We are very well posed in terms of wanting to make sure that we’re supporting basic research because that really provides the seed for future capabilities,” Shyu said during the webinar. 

Several of the Pentagon’s “critical technology areas” would also receive increased investment in fiscal 2024. The department is asking for $6.9 billion to fund continued research, development and prototyping of the 14 technologies considered to be vital to the United States’ national security.

The request includes funding across Shyu’s office, the Defense Advanced Research Projects Agency, the Defense Technical Information Center, the Missile Defense Agency, the Office of the Secretary of Defense Strategic Capabilities Office and the Test Resource Management Center, Shyu said.

Almost a quarter of the funding for these technologies would be allocated to microelectronics, Shyu noted. The Pentagon is seeking $1.7 billion to fund the critical technology, according to Shyu’s presentation during the webinar.

Microelectronics are key circuits and components that act as the “brain” for many military and commercial systems. But because a majority of microelectronics are manufactured overseas, the Defense Department in recent years has prioritized the need to secure its own supply chain within the United States.

In particular, microelectronics innovations are driving an increase in DARPA’s budget request of $4.4 billion for fiscal 2024, DARPA Director Stefanie Tompkins said during the webinar. The research agency is specifically seeking $892 million to fund its microelectronics projects as part of a five-year-long Electronics Resurgence Initiative, she said.

While other efforts — such as the State-of-the-art Heterogenous Integrated Packaging (SHIP) program and the Creating Helpful Incentives to Produce Semiconductors (CHIPS) legislation — focus on near-term supply chain vulnerabilities, DARPA’s initiatives are looking at future advancements in microelectronics manufacturing, Tompkins said.

“We are focusing on 3D heterogeneous integration. We have spent a fair amount of time and resources in the last five years figuring out the science of that,” she said. “A big part of what we will be doing in the next iteration of our Electronics Resurgence Initiative is the manufacturing ability — so the actual science of scale. Now that we’ve proven that something is possible once, how do we make sure that it’s actually possible in the real world and will operate under real-world conditions?”

When combined with microelectronics funding, the requests for integrated sensing and cyber and integrated network system-of-systems make up over half of the Pentagon’s budget request for its critical technology areas in 2024, Shyu noted. The department is seeking $1.2 billion for integrated sensing and cyber and $763 million for integrated network system-of-systems.

For its other critical technology areas, the department is asking Congress for $629 million for trusted artificial intelligence and autonomy, $601 million for hypersonics, $407 million for biotechnology, $403 million for space technology, $318 million for future-generation wireless technology (FutureG), $280 million for directed energy, $249 million for advanced materials, $159 million for quantum sciences, $45 million for human-machine interfaces and $30 million for renewable energy.

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Semiconductors are embedded in and power many critical modern-day technologies, like computers, smartphones, pacemakers, vehicles, the electric grid and much more. Microchips originated in America during the 1950s, but today, the nation consumes roughly half of those made worldwide. At the same time, only around 12% of microchips are currently manufactured in the U.S., which creates supply chain vulnerabilities.

In 2020, Purdue University announced it was selected to steer a national initiative sponsored by the Office of the Secretary of Defense to confront the escalating need for engineering graduates specializing in microelectronics. That multi-university public-private-academic partnership — the Scalable Asymmetric Lifecycle Engagement Microelectronics Workforce Development program (SCALE) — saw an initial investment from the Pentagon of $19.2 million.

Purdue officials confirmed on Monday that the DOD has moved to expand SCALE with a commitment of $10.8 million in additional funding and a possible ceiling of $99 million.

“Part of the rationale for expansion is to continue existing work in areas like system-on-chip and embedded systems security / trusted artificial intelligence. The other part of the rationale was to extend the mission to K-12 programs, with an initial small-scale pilot aimed at providing a national model for introducing context and content to K-12 teachers, staff, and students,” Peter Bermel, SCALE director and the Elmore Associate Professor of Electrical and Computer Engineering at Purdue, told DefenseScoop in an email Monday.

The U.S. will need 50,000 trained semiconductor engineers to meet rapidly increasing demand in the near term, according to Bermel, meaning there’s more room for students to support government and defense contractor requirements. 

“This is a unique opportunity to both help students pursue highly impactful career opportunities, meet national needs, and update the university programs to reflect the rapidly-changing research and educational landscape in this area,” he said.

Managed by the Naval Surface Warfare Center, Crane Division (NSWC Crane), SCALE connects faculty from nearly 20 universities, and experts from dozens of entities across the government and defense industry, with the ultimate goal of ensuring the U.S. has a personnel pipeline necessary to meet next-generation national security needs. Academic institutions involved are frequently informed by the dozens of public and private stakeholders on expectations for new entrants of the microelectronics-focused workforce, and typically update their curricula to reflect those insights. 

SCALE-enrolled undergraduate and graduate students can receive mentoring and research opportunities from the organizations involved, and there are also pathways for internships and job placements.  

The program is evolving, but as of June, government and industry partners included the Jet Propulsion Laboratory, Missile Defense Agency, Space Force, NASA, multiple military research labs, Boeing, L3Harris, Northrop Grumman, and Taiwan Semiconductor Manufacturing Company — among many others. 

“SCALE’s impact includes reaching 287 students at 17 universities; 17 defense industry partners; and 17 government partners, with more to come in the near future,” Bermel told DefenseScoop.

In a recent survey of students associated with SCALE, 73% of respondents reported being hired into “a suitable summer internship or research position,” he said. The majority of those who participated in the survey also reported positive experiences around the mentoring provided. 

“Recent SCALE graduates, predominantly undergraduates so far, have been reported as going onto defense industrial base companies and graduate study,” Bermel said.

With the five-year expansion and extension from DOD, officials intend to grow student participation in SCALE fivefold — to more than 1,000 — and cooperate with community colleges to create microelectronics courses across the nation.

Microelectronics is a top priority for Undersecretary of Defense for Research and Engineering Heidi Shyu, and it’s listed among 14 technology areas of critical importance to the Pentagon.

This new announcement also follows the passage of the CHIPS and Science Act, which revamps and advances domestic capabilities to drive the making of such nanotechnologies. 

In addition to SCALE, Purdue is leading other strategic initiatives to boost microelectronics development, including the MidWest Research Regional Hub effort, the first comprehensive semiconductor degree program conducted in partnership with SkyWater Technology, that is expected to generate a $1.8 billion future state-of-the-art chips manufacturing facility.

The Indiana-based university currently houses the Birck Nanotechnology Center — a facility focused on the production of microelectronics and semiconductors, as well as capabilities in other, generally related, disciplines.

In the last few months, U.S. government leaders including Deputy Defense Secretary Kathleen Hicks, Secretary of State Antony Blinken and Secretary of Commerce Gina Raimondo have visited the center.

After touring the facility in August, where she observed microelectronics unfold in real-time, Hicks told faculty, researchers and students “there is no understating how critical that work is.”

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Lab officials announced the formation of this new science and technology ecosystem in February, with the intent to promote more collaborative research, translation, and workforce development pursuits strategically within U.S. regions.

Purdue and Cornell universities were tapped as the initial leading institutions that will help AFRL facilitate deeper work with businesses, venture capitalists, other academic institutions and government agencies in their surrounding areas. 

“Over the last six months, we’ve been very active in standing up the operations — everything from information security, to [intellectual property] relationships, to membership agreements and information-sharing — all the fun things that are behind the scenes to make something like this work,” Richard Vaia, AFRL’s chief scientist for materials and manufacturing, recently told DefenseScoop. “Starting this Fall, we’re going to solicit the initial pilot technical projects, with a scope of about an 18-month sprint for such a project.”

On a recent technology-focused trip to that lab and other federally-aligned research facilities with Deputy Secretary of Defense Kathleen Hicks, DefenseScoop was briefed by Vaia and others on those in-the-pipeline projects and certain unique elements of this new experimental network of regional research hubs.

“I would argue this is like a grassroots version of what the future of research engagement could look like,” Purdue University mechanical engineering professor and laboratory director Jeffrey Rhoads noted.

The genesis

Based at Wright-Patterson Air Force Base in Ohio, AFRL helps lead the discovery, development and integration of emerging capabilities for both the Air and the Space Forces. Officials there have historically relied heavily on other government entities, commercial vendors, and academic partners to do so, with which they engage both collaboratively or transactionally.

In 2017, then-Air Force Secretary Heather Wilson tasked the lab to explore ways to engage differently and more effectively “in the innovation ecosystem outside the gates,” Brian McJilton, director of the lab’s Small Business Directorate, explained to reporters during a briefing on Hicks’ visit. The deputy secretary received mostly classified briefings with more sensitive details on similar topics.

Officials brainstormed, McJilton said, asking, “What are some of those best practices that we can glean from industry, academia, and maybe other government organizations to be a much more cohesive and accelerated operation for the Air Force?”

Between then and 2019, AFRL officials conducted a number of ideation events with universities and companies across the United States, inviting many participants from different regions across the nation to engage in-person with lab officials to brainstorm and discuss various challenge areas they are collectively facing.

“What we found was that — while we pride ourselves on being well known — we found out that AFRL is not as well known across the U.S. as we thought we were,” McJilton said.

In some segments of the country, lab officials also found that broadly people had very little understanding of the Air Force’s mission “other than just planes,” he noted.

From those engagements AFRL officials also found that enabling subject matter experts to work “on the other side of its fence” provided new opportunities for learning and supporting those regional ecosystems. Since then, the lab has been targeting a number of implementation efforts to incentivize external collaboration and workforce development simultaneously.

“That’s what really led up to the genesis of the regional hub idea,” McJilton said.

The Air Force’s R&D arm kicked off the pilot in Summer 2021 and signed cooperative agreements in February. 

After a bit of research and analysis, the lab tapped Cornell University in Ithaca, New York, to lead the AFRL Regional Research Hub — Mid-Atlantic, and Purdue University in West Lafayette, Indiana, to lead the AFRL Regional Research Hub — Midwest.

During briefings at AFRL, lab insiders emphasized that this work is inherently experimental, as a pilot. 

“The idea is that we’re establishing a new way of doing business with the outside community through this,” Vaia noted. “Instead of one-off relationships, we’ll work through an ecosystem. The two universities that were chosen, were chosen as the leaders of the ecosystem. So the hub is not with the university — the hub is with the university and the ecosystem that is surrounded.” 

He and his colleagues added that a key to success in this effort is to get technology accelerated through to industry via more direct engagement between all the sectors.

“This is really, truly partnering in the full definition of a partnership where we’re bringing our resources to the table, they’re bringing their resources together — and collectively together, we’re pursuing areas of interest, both from the military and commercial sense,” McJilton said.

What’s new

The ultimate aim is that the different partners will learn more about each other’s facilities, missions, talent pipelines and supply chain challenges to inform smarter solutions down the line.

“Another key attribute of this regional hub ecosystem is the experiential learning that our [subject matter experts] are going to be able to get from working side-by-side with other SMEs,” McJilton said. 

They could evolve based on national security and modernization priorities in the future, but the initial strategic technology focus areas that the Midwest hub will concentrate on are energetics, hypersonics and microelectronics.

“You will see an incredible suite of capabilities at Purdue associated with their new defense-oriented facilities that actually allow a lot of classified research on campus, which is very exciting,” Vaia told reporters who were heading to the university with Hicks.

Staff of that academic institution and AFRL have been actively enlisting membership in the hub. Currently, members of the regional ecosystem anchored at Purdue include less than a half-dozen companies from around Indiana, Ohio and Michigan. Academic institutions in that hub include the University of Wisconsin, as well as Purdue, Ohio State, South Dakota and Notre Dame universities.

“We’re still interested in engaging additional partners in the Midwest, or nationally, that want to engage more with the Midwest,” Rhoads told DefenseScoop in an interview.

A mechanical engineer by training, Rhoads is a professor and lab director at Purdue who is also deeply involved in the school’s collaboration with the government and companies. Any entities interested in working with the hub can reach out to him directly through the university, he noted.

In Rhoads’ view, the promotion of side-by-side, technology-focused personnel exchange opportunities for those employed by AFRL and hub members is one of multiple unique and defining features of this unfolding pursuit.

“That’s not to say there hasn’t been new segments of personnel exchanges in other contexts — but the concept that the Air Force or the Space Force, for example, might be willing to put personnel in companies to learn how those companies operate, but also share subject matter expertise, or to do the same at universities, I think is a much further extension of other things that have been talked about in recent years,” he said.

Rhoads is involved in benchmarking the program against existing efforts such as the Naval Tech Bridge and the Army Research Lab’s regional campuses. His team hopes this work will take related original concepts about public-private partnerships to the next level.

“There’s not just going to be a representative in the region. There’s actually going to be representatives and scientists and engineers embedded in laboratories and in companies,” he said. “If people aren’t talking and seeing the realities on the ground, they’re going to make decisions that are suboptimal because they just don’t have the best information available. So, to me, this is short-circuiting some of those communication chains so that people live and breathe and see things, you know, face to face.”

Another notable element of the work is the deeper access to facilities between parties and sharper awareness that could help reduce the duplication of technological resources across sectors. 

“A good example of that is the facility you saw. I mean, it doesn’t make sense to have hundreds of hypersonic wind tunnels around the nation. If there’s a select number well-distributed that a lot of different people can access, that’s a much more sustainable model from a national perspective,” Rhoads said.

While the notion of public-private partnerships is not novel, in Rhoads’ view, such engagements are typically very weighted in one component’s direction or another.

“My take on the hub, from the academic side, is it’s trying to think about new partnership models where you’re really bringing academia, government and industry to the table as near equal partners,” he said. “I don’t want to paint it as a three-way picture because I think the other piece of that is the venture [capital] community.”

In the past, only a small segment of venture capitalists generally engaged with the Pentagon, because their return on investment has traditionally been quite low. Rhoads hopes this will help de-risk the process to work with DOD for such organizations in the future.

During the briefing at AFRL, Vaia noted that plans for the Cornell- and Purdue-based regional hubs include initiating one to three projects and engaging five to 10 experts with each of the universities in this first year of the pilot. Officials envision having six 12-month projects ongoing at one time. 

The overarching intent of the pilot is for each regional network to approach the collective goals in their own special ways.

“After a three-year run, we’ll assess if this is really achieving the goals of engaging the ecosystem and accelerating technology — and at that point, we’ll either decide to expand the concept to maybe add a few additional regions or decide that it was a great experiment that we learned from and go back and reassess the next steps,” Vaia said.

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The cutting-edge technology includes integrated circuits capable of processing computationally demanding artificial intelligence systems, according to a new report by the Center for Strategic and Emerging Technology (CSET). There are different types of AI chips including graphics processing units (GPUs), field-programmable gate arrays (FPGAs), and certain application-specific integrated circuits (ASICs).

“Different kinds of AI chips have advantages and disadvantages when it comes to either training a machine learning system, or using that system to make an inference about the world. But … only cutting-edge chips — generally considered today to be chips at the 12 nm node and below — are suitable to train and run cutting-edge neural networks,” the study explained.

Notably, the companies that lead the pack when it comes to chip design aren’t the same ones that are top dogs in manufacturing.

“U.S. firms like Nvidia, Xilinx, and Intel dominate the international AI chip design market, while South Korea’s Samsung and the Taiwan Semiconductor Manufacturing Company (TSMC) remain the titans of global semiconductor fabrication,” the CSET report noted. “High barriers to entry, including a reliance on intrinsic knowledge and highly specialized equipment, have so far prevented Chinese companies from catching up.”

However, China’s lag doesn’t mean the People’s Liberation Army (PLA) hasn’t been left empty-handed.

In its latest report on Chinese military power, released last year, the Pentagon noted that the Beijing is using imports to help achieve its military modernization goals.

“The [People’s Republic of China] is investing in and seeking to acquire technologies that will be foundational for future commercial and military innovations including AI, robotics, autonomous vehicles” and other capabilities, the study said in a section about the nation’s foreign technology acquisition efforts.

Over the last five years, the People’s Liberation Army has made “significant progress” in adopting AI for combat and support functions, according to the CSET study.

However, its continued progress largely depends on maintaining access to the special class of semiconductors which are used to train advanced machine learning systems, it noted.

The U.S. government has been taking steps to restrict the supply of artificial intelligence-related tech to China, including adding Chinese government organizations and AI companies to its “Entity List” — a move which bars American firms from selling them technology without Uncle Sam’s approval.

Senior U.S. officials, including Secretary of Commerce Gina Raimondo, have also been banging the drum about the importance of semiconductors for maintaining America’s technology edge over nations like China.

“We also need to retain our strategic advantages by keeping our advanced technologies out of the wrong hands,” she said in June at the Bureau of Industry and Security (BIS) Update Conference.

However, the CSET report noted that “despite more aggressive efforts by the Trump and Biden administrations to limit technology exports to the Chinese military, the PLA is placing orders for AI chips designed by U.S. companies and manufactured in Taiwan and South Korea.”

U.S. semiconductor companies may not be aware that their products are in some cases destined for the Chinese military, the study noted.

Of the 97 individual AI chips that CSET researchers identified while examining public PLA purchase records, nearly all were designed by Nvidia, Xilinx (now AMD), Intel, or Microsemi.

“We searched for, but could not find, any records of PLA units or defense state-owned enterprises (SOEs) awarding contracts for Chinese-designed AI chips,” the researchers noted.

Holes in the export control regime

The CSET report highlighted regulatory shortcomings that have enabled the People’s Liberation Army to acquire U.S.-designed high-tech semiconductors, including how the PLA’s intermediary suppliers are rarely named in U.S. export control lists.

“Under the current U.S. export control system, it is likely that none of the AI chips sold to PLA units or defense companies would have required a license for export from the United States or any other government. Among the seven Chinese companies in our dataset selected to supply U.S.-designed AI chips to the PLA, none are named in the U.S. Commerce Department’s Entity List or Military End User List. Moreover, most of the AI chip purchases in our dataset are for GPUs, which are not a controlled commodity,” the study said.

Notably, the military end-user rule does not apply to foreign-manufactured semiconductors shipped from outside the United States, even if the chips were designed in the U.S., according to the report.

“Except for some types of FPGAs covered by multilateral export control regimes, no other country specifically regulates semiconductor exports to China,” it noted.

Analysts see opportunities for reform.

One option would be to introduce a tailored set of new export controls that are applied multilaterally with nations that play a key role in the semiconductor ecosystem. For example, the Department of Commerce could identify specific types of chips that are relevant to training AI systems, and coordinate with partner nations that manufacture them to screen intended end-users before the semiconductors are exported. The department could also expand military end-user rules and apply them to exports of otherwise uncontrolled chips, experts say.

“Creating new authorities on the grounds of [semiconductor] technological characteristics … would actually give the Department of Commerce, and particularly the Bureau of Industry and Security, much more latitude to act at its own initiative to prevent problematic transfers of U.S. technology,” Ryan Fedasiuk, the lead author of the new CSET report, told FedScoop.

He believes nations that are home to some of the leading chip manufacturers would be willing to sign on to a more robust, multilateral export control framework.

“I think South Korea certainly sees eye to eye with the United States on a lot of issues,” he said in an interview. “I think that the Blue House is working actively for opportunities to cooperate and coordinate with Washington. And I think that export control is an area ripe for this opportunity.”

Taiwan’s concerns about Chinese aggression toward the self-governing island could make it amenable to cooperating with the U.S. in this regard.

“I think that probably there is appetite among policymakers in Taiwan to make sure that they are steeling themselves against increases in Chinese military power. This seems like a commonsense solution that folks in Taiwan’s governments would probably jump at,” Fedasiuk said.

The U.S. government could also beef up its open-source intelligence analysis to examine China’s innovation ecosystem.

“One of the biggest challenges that U.S. regulators face in curbing Chinese military power is knowing who in China is supplying the military with weapons and equipment. And if we actually have more analysts, with language capabilities, using open-source information, I think we can get a much better sense of the problem,” Fedasiuk said.

“The thing that I would most emphasize is that this is a resource problem,” he added. “The more research I do … the more I’m convinced that we need more analysts looking at the Chinese defense industry, and we need more Chinese speakers and subject matter experts analyzing the issue … The U.S. government really needs to be investing in open-source intelligence collection that doesn’t fall squarely within the Title 10 and Title 50 authorities brought with the intelligence community and the military.”

A more extreme policy option that researchers have looked at is trying to impose a total embargo on high-end semiconductor sales to China, regardless of who the end-user might be. However, some are skeptical about the political and economic viability of such a move.

“It would be extremely difficult to persuade leaders in Taipei and Seoul to sign onto such a drastic step. Looking domestically, suddenly adopting an embargo on AI chip exports could have severe and potentially catastrophic consequences for the U.S. semiconductor industry and long-term technological innovation,” the CSET report said, noting that China accounts for about 25 percent of global AI chip consumption, and a total embargo would result in U.S. chip designers losing billions of dollars annually.

Intermediate suppliers

China’s “military-civil fusion” strategy — which includes a focus on commercial tech that the People’s Liberation Army can leverage — presents a big challenge for U.S. agencies trying to limit the PLA’s access to AI chips.

“Beijing’s MCF strategy includes objectives to develop and acquire advanced dual-use technology for military purposes,” according to the DOD report on China’s military power. That entails “fusing” the nation’s defense industrial base and its civilian technology and industrial base, integrating and leveraging science and technology innovations across military and civilian sectors, and other steps to try to give the PLA an edge.

In each case the CSET researchers examined as part of their study, the contracts that the PLA and state-owned defense firms awarded for U.S.-designed chips went to Chinese intermediary companies.

“Difficulties associated with tracking AI chips and the variety of potential vendors would make it challenging for U.S. regulators to wage a targeted crackdown on the PLA’s intermediary chip suppliers,” they said in their report. Additionally, “the PLA often buys commercial off-the-shelf AI systems from Chinese academic institutions and private companies, which also buy U.S.-designed chips, and are not easily captured by U.S. restrictions on military end-users.”

It continued: “Due, in part, to the Chinese Communist Party’s military-civil fusion strategy, U.S. regulators have struggled to distinguish between military and nonmilitary end-users in China. A policy framework that focuses narrowly on limiting chip sales to the PLA and major defense SOEs risks leaving China’s burgeoning AI defense industry intact, and would minimally affect the quality of systems and services sold to the PLA.”

Despite the challenges involved, Fedasiuk believes new export control authorities and approaches implemented multilaterally with like-minded partners — combined with more resourcing and leveraging of open-source intelligence to better understand China’s defense innovation ecosystem — can help keep more AI chips out of the hands of the PLA.

“It’s hard to quantify, but I do think that they would have a substantial impact — if enacted appropriately and comprehensively,” he said.

FedScoop asked Fedasiuk if reducing the PLA’s access to these types of chips would push Beijing to accelerate its efforts to boost its semiconductor industry­ — thereby minimizing the long-term impact of more robust U.S. export control initiatives.

China is already investing hundreds of billions of dollars to strengthen its semiconductor industry, Fedasiuk noted.

“I would just be skeptical of claims that this is going to accelerate their push because, again, there’s already so much money in the space. I have no idea what an elevated push for indigenization would look like. It seems like it’s dialed up to 11” already on a scale of 1 to 10, he said.

Fedasiuk is also skeptical that additional efforts to restrict AI chip exports would provoke China to invade Taiwan in order to seize control of semiconductor manufacturing facilities.

“If they attempted to do so, you know, if I were a military planner, I’m gonna bet that those fabrication facilities are destroyed. There are inordinately delicate rooms, clean rooms, where the chips are actually … printed. If a single munition were to detonate like 10 feet away, it would just be disastrous and completely eradicate any value of the facility. So I really think that this is kind of an overblown threat — the idea that China will invade to seize fabrication potential,” he said. Taiwan, faced with a Chinese invasion, could also blow up the facilities as an act of sabotage, he noted.

CHIPS legislation

Meanwhile, senior Biden administration officials are pushing Congress to fully fund the Creating Helpful Incentives to Produce Semiconductors (CHIPS) in America Act, which has been stymied by political gridlock over a broader legislative package aimed at boosting U.S. innovation. The legislation would provide more than $50 billion in investments to boost domestic semiconductor manufacturing.

In a joint letter to Congress sent July 13, Commerce Secretary Raimondo and Defense Secretary Lloyd Austin said semiconductors are “ground-zero” in the technological competition between the United States and China.

“They are driving innovation and competitiveness in nearly every emerging technology” including AI, and also have “a wide range of critical national security applications,” they wrote.

“This bill will prioritize strengthening domestic manufacturing capacity and supply chain resiliency, spur domestic semiconductor manufacturing, make transformational commitments to research and development, and help counter competition from China, while also shoring up U.S. competitiveness, lowering costs and creating jobs,” the secretaries said. “If we miss this window, the United States will fall further behind in global semiconductor production and jeopardize our advantage in next generation design.”

Fedasiuk supports passing the CHIPS in America Act, arguing the legislation is “desperately needed” to keep the US. semiconductor industry competitive with other nations including China. However, he doesn’t think it will necessarily have much of an impact in addressing the problems outlined in the CSET report.

“Theoretically, yes, if chips are made here they could more easily fall under the jurisdiction of U.S. regulators, and so could more easily be controlled by U.S. export control law,” he said.

However, the number of high-end AI chips that would be manufactured in fabrication facilities in the United States as a result of the CHIPS legislation might be relatively low compared to the number being built in Taiwan, for example, he added.

“As far as I understand that … you’re talking about kind of commodity-level chips used in iPhones, which are not the same as these very high-end devices that would be used to train AI systems and next-generation weapons. And so that’s why I think that the impact would be miniscule,” he said.

The U.S. government can try to provide U.S. companies alternatives to the massive Chinese market as part of an effort to reduce sales to China, the CSET report noted. “But the real challenge would be whether, or how, to compensate for the loss of Chinese market access,” it added. “Even with carefully calibrated incentives and a more robust industrial policy, some experts warn that eliminating this source of revenue could have dire consequences for U.S. innovation and economic competitiveness.”

The Commerce Department did not respond to a list of questions from FedScoop about efforts to restrict Chinese military access to AI chips.

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The 12-page document — publicly shared Wednesday by Deputy Defense Secretary Kathleen Hicks via tweet — was informed by a range of comprehensive studies. It comes roughly a year-and-a-half after the Pentagon established the Defense Microelectronics Cross-Functional Team (DMCFT) to produce an enterprise-wide strategy with implementation and transition proposals to enable a more sustainable national ecosystem of such components, which are critical for a wide range of U.S. military systems.

“The U.S. military advantage depends on microelectronics to create and sustain technological superiority,” Pentagon spokesperson Lt. Cmdr. Tim Gorman told FedScoop on Friday. “Releasing the document now emphasizes the importance in developing a departmentwide microelectronics strategy.”

This vision includes a list of seven “interconnected objectives” to guide the overarching development going forward — though current and former Defense Department officials acknowledge that it’s somewhat vague in terms of execution.

The objectives are:

• Ensure timely access to measurably secure and affordable microelectronics (ME) technology.
• Motivate programs and their primes to modernize and exploit the most capable ME.
• Leverage tools, policies and enforcement to reduce or eliminate costly sustainment issues.
• Centralize knowledge in a DOD “frontdoor” organization to augment decentralized execution.
• Increase ME discovery and innovation, and accelerate transition into DOD systems.
• Contribute to and influence interagency and national efforts to grow ME capabilities to meet national security needs.
• Cultivate a workforce with the right capacity and the right skills at the right place and the right time.

‘A pivotal moment’

Microelectronics like semiconductors or chips are embedded in a slew of platforms the Pentagon buys and relies on — from mobile communications devices to computers, advanced weapon systems, and more. 

“Each of the Javelins you produce includes more than 200 semiconductors,” President Biden recently told employees at a Lockheed Martin missile factory in Alabama. “The semiconductor is critical to defense production capacity.”

But the United States has struggled to enable a secure domestic production base for military-related chips for decades. And experts are tracking a range of factors that have persistently hindered DOD’s access to chips for military and other mission-specific applications.

“Depending on the program, a fundamental challenge is that in many of our weapons systems, we are not using the most recent, most powerful, and most capable chips. We’re using what they call ‘legacy chips,’ which are much less robust, although not necessarily ineffective. We talk about the latest Apple iPhone, but we run our airlines and our banking systems and our Defense Department in large part using legacy systems,” Charles Wessner, a research professor at Georgetown University and non-resident senior adviser for the Center for Strategic and International Studies, told FedScoop on Thursday. 

The Pentagon’s needs and access to microelectronics continue to evolve. For many reasons, most semiconductors are currently produced by foreign suppliers — and a global supply chain shortage, intensified by the COVID-19 pandemic and other challenges, is forcing the Pentagon and the nation writ large to confront major disruptions.

In response to this ongoing shortage, Undersecretary of Defense for Research and Engineering Heidi Shyu has elevated microelectronics as a top priority and critical technology area for DOD. The department is also investing heavily to boost domestic manufacturing. Further, the White House and senior federal officials are simultaneously urging lawmakers to quickly pass the Creating Helpful Incentives to Produce Semiconductors (CHIPS) legislation, which would direct billions of dollars in funding toward efforts to strengthen America’s microelectronics production.

“The most important thing that can be done right now is that the Congress can pass the American Innovation Act, the CHIPS Act, to get us on-shored here in the United States microchip processing capability, manufacturing and processing capability,” Hicks said this week.  

Still, many of the issues this new prioritization of microelectronics aims to address have been bubbling for a while.

“It’s very encouraging to see that they’re focused on this crucial component of our armed defense systems,” Wessner said of the new microelectronics vision. “It’s a very valuable initiative. It’s certainly not too late, but it needs to be done.”

In the document, Shyu and Undersecretary of Defense for Acquisition and Sustainment Bill LaPlante wrote that the DOD “is at a pivotal moment where it must take advantage of the national interest and funding in [microelectronics] by developing a unifying vision and strategy to ensure national security equities are met.” 

The vision, which could be refined and updated over time, is a product of recommendations from the DMCFT, they noted.

Gorman confirmed the DMCFT has been engaging with subject matter experts from across the private and public sectors and reviewing heaps of materials to inform their crafting of this early document and the official strategy that will follow.

That team was formed in early 2021 to address six vulnerabilities associated with procurements of critical microelectronics components that fundamentally threaten DOD’s ability to sustain and buy key weapons, following a deep examination of the world’s and department’s supply chains in 2019 and 2020. So far, they have developed a “central vision statement,” which says DOD will “obtain and sustain guaranteed, long-term access to measurably secure microelectronics that enable overmatch, increased operational availability, and support warfighter combat readiness.

Gorman said: “The DMCFT is using this vision to identify approaches and resourcing requirements to achieve the department’s strategic microelectronics objectives. The DMCFT will continue to collaborate across the interagency, industry, and academia in developing the DOD implementation and transition plans.”

Questions remain

“I would like to see DOD proposing something more concrete,” Bryan Clark, senior fellow and director of the Center for Defense Concepts and Technology at the Hudson Institute, said of the Pentagon’s new microelectronics vision document.

“The vision is a little disappointing. We need a strategy, but that implies a document that describes the choices and priorities DOD will establish and how it will pursue them,” Clark told FedScoop on Thursday. “This vision identifies a set of objectives without any sense or prioritization or mechanism to accomplish them.”

Clark, who served in several federal roles including special assistant to the chief of naval operations after retiring from the Navy, added that a complete strategy “would identify how DOD would like government funding to be prioritized” in existing and future initiatives, and describe “how the department will incentivize industry to modernize the microelectronics in their systems.”

The vision includes brief “objective alignments” that elaborate on the department’s approach — though they are each pretty vague. 

For example, the vision states that the Pentagon “will ensure that programs and primes have the resources, motivations and know-how to utilize relevant ME technologies, processes standards and support” — but does not hint at what those incentives might look like.

“A challenge DoD faces is that most defense systems use older types of microelectronics and therefore they don’t exploit the advancements happening in commercial or research applications such as small node sizes, chiplets, [system-on-a-chip], etc. DOD wants industry to move into new generations of chip technology because they offer more functionality, but also because they can gain from private sector investment in innovation. Incentivizing this shift will mostly involve changing requirements to demand more sophisticated chip designs in DOD systems, which may cost more,” Clark said.

Wessner also noted in a separate conversation: “The question will be, what are the incentives in place?”

Gorman declined to provide any specifics regarding plans to “motivate programs and primes” to exploit microelectronics, among other inquiries this week.

Clark added that the vision argues for on-shoring, or shifting capabilities to be domestically produced, to make the microelectronics supply chain both more resilient to shocks and more secure against tampering. 

However, “tampering can occur regardless of where the fabrication, packaging, or testing is done, and DOD should be accelerating its move toward ‘zero-trust’ microelectronics where testing catches alterations that are meaningful,” he said. “In terms of resilience, allies like Japan, Korea, European countries, and Canada can build more microelectronics of the types DOD needs. This ‘near-shoring’ could address the concern as well as bringing capacity back to the U.S.”

In Wessner’s view however, the document — while not as concrete as some would like — does incorporate “an encouraging amount of detail” for an initial vision statement.

“You have endorsement at the top of the department. Yes they’ll have to execute. Yes, it will be difficult — but you get there by starting,” he said.  

He added that this work needs to continue to have sustained resources, high-level attention and “some ability to break through the compartmentalization that often creates challenges for the department’s acquisition teams.”

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As part of a Defense Production Act Title III agreement, GlobalFoundries will transfer its 45-nanometer silicon-on-insulator (SOI) semiconductor manufacturing process from its Fab 10 facility in East Fishkill, New York, to its Fab 8 facility in Malta, New York. Last year, the firm received an $8 million award to conduct initial engineering baseline activities for the transfer, according to a DOD news release.

“This agreement will ensure access to 45nm SOI semiconductors critical to DoD strategic systems,” the release stated, noting that the deal is “part of the nation’s effort to sustain the microelectronics manufacturing capability necessary for national and economic security.”

The first chips from the agreement are slated for delivery next year, according to GlobalFoundries.

“GF is proud to be a longtime supplier to the U.S. Government, and we remain deeply committed to meeting the semiconductor technology needs of the Department of Defense, as well as the technologies so critical to our national security,” CEO Tom Caulfield said in a statement.

He continued: “The strong public-private partnership demonstrated with this new supply and tech transfer agreement is an excellent example of the impact federal collaboration and investment in semiconductor manufacturing can have on strengthening domestic supply chains. Our partnership boosts the national economy, while also securing a strategic and reliable supply of chips needed by the U.S. government for aerospace, defense, and other mission-critical applications.”

Microelectronics are a key component of the DoD’s advanced capabilities including precision guided munitions, hypersonic weapons and satellites. Pentagon officials are worried about supply chains.

“The migration of semiconductor manufacturing to the Asia-Pacific region, and the subsequent decline in domestic manufacturing, represents a substantive security and economic threat for the United States and many allied nations,” DOD said in a February report on securing defense-critical supply chains, an action plan developed in response to President Biden’s Executive Order 14017.

The COVID-19 pandemic has exacerbated supply chain challenges.

Federal agencies, including the DOD, are seeking to boost the U.S. industrial manufacturing base.

Microelectronics are a top priority for Undersecretary of Defense for Research and Engineering Heidi Shyu, who has deemed them a “critical technology” area.

During a webinar last month hosted by the National Defense Industrial Association, Shyu noted that “there’s a real focus on onshoring.”

Among its various microelectronics initiatives, the Pentagon wants to create regional innovation hubs to promote domestic development.

In February, Shyu’s office issued a request for information seeking feedback on creating what the DOD is calling a Microelectronics Commons.

The Pentagon envisions the commons as a public-private partnership consisting of regional innovation hubs distributed across the United States that will “foster a pipeline of innovative ideas and talent residing in university labs and small business R&D teams,” according to the RFI.

The aim is to reduce barriers to innovation and enhance infrastructure, namely by establishing “Lab-to-Fab” testing and prototyping hubs, providing broad access to those hubs for developers, and strengthening the education pipeline around microelectronics at academic institutions.

The hubs will “focus on critical, on-shore prototyping to transition innovation from universities, start-ups, and small companies to manufacturing,” the RFI said.

Editor’s note: This story has been updated to include a statement from GlobalFoundries.

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