REPORT: How to Make the NSTC a Moonshot Success
Thanks to the Institute for Progress (IFP)
The National Semiconductor Technology Center (NSTC) has been slower to materialize than manufacturing grants funding under the CHIPS and Science Act of 2022, but this public-private consortium has the potential to leave the greatest impact on U.S. technological leadership for decades to come.
In an extensive report at the Institute for Progress (IFP),
and I highlight market failures that challenge research and investment in the semiconductor industry, and propose an organizational infrastructure that would allow the NSTC to plug these holes as a unique market actor.The introduction is teased here. Be sure to check out the Institute for Progress for the full report! Thank you to the team at IFP for helping cohere what was once a rant into the arguments below.
Don’t sell the CHIPS moonshot short
A year and a half after passage of the CHIPS and Science Act of 2022, a nonprofit, Natcast, has finally been established to govern the CHIPS Act’s underappreciated gem: the National Semiconductor Technology Center (NSTC). The CHIPS Act appropriated over $52 billion to revitalize the American semiconductor industry, and its $39 billion reserved for chip manufacturing subsidies received the most attention. More important to America’s long-term technological leadership, however, is another $11 billion set aside to fund a series of research initiatives.
These research initiatives, especially the NSTC, have the potential to turbocharge American innovation. The NSTC consortium is the first American attempt since 1987 to create a public-private partnership for semiconductor technology. Done right, it could lead to paradigm shifts in areas such as computing for machine learning, advanced computing security, and in the environmental sustainability of chipmaking itself.
However, the world is full of research consortia that only incrementally advance technology frontiers. If the NSTC is insufficiently ambitious, it will likely not improve on existing efforts in industry, academia, and foreign consortia. Moreover, it may not produce sufficient value to survive beyond its five years of CHIPS Act funding.
The CHIPS manufacturing grants serve short-term goals: restoring America’s share of global semiconductor manufacturing and securing critical supply chains. The NSTC ought to target a long-term goal: ensure America remains the birthplace of paradigm-shifting technologies. Commerce Department officials should not relegate the NSTC to a low-risk R&D subsidy aligned with existing industry agendas. Rather, the NSTC’s research and investment agendas should pursue paradigm-shifting moonshots.
While Congress laid out clear goals for the manufacturing grants in the CHIPS and Science Act, it left its instructions for the NSTC vague. This ambiguity gives the Commerce Department a unique opportunity to dream ambitiously. Based on dozens of interviews with chip startup founders and venture capitalists, this paper articulates a vision for a moonshot-focused NSTC, and proposes the organizational steps for getting there:
Correcting market failures in research and manufacturing
Major players across the chip industry face…
… continue reading here.