Japan To Set Up New Semiconductor Outfit With IBM's Help

Japan looks set inject 70 billion yen ($500 million) into a new semiconductor company amid plans to jump-start next generation advanced chip production with the help of IBM.

Earlier this week, we reported on the nation’s preparations for a joint research program with the US to build cutting edge chip plants. The project will be allocated 350 billion yen ($2.38 billion), and follows earlier proposals for a bilateral chip deal between America and Japan to develop the technology for 2nm chips.

Now, Tokyo has announced it will form a new semiconductor company named Rapidus, backed by the initial 70 billion yen investment, which will play a central role in this project. It will also be backed by a number of the country’s companies, including Toyota, Sony, NTT, SoftBank, Kioxia, Denso, NEC, and MUFG Bank, according to The Japan Times.

The latest move was announced at a briefing with Japan’s minister of economy, trade and industry Yasutoshi Nishimura, who said Rapidus is expected to begin making chips in the second half of the decade, as part of an effort to revitalize its semiconductor industry and strengthen ties with allies, chiefly the US.

“As the rivalry between the US and China over tech supremacy has been intensifying, chips are becoming more important in terms of economic security,” Nishimura said.

IBM is set to partner with Rapidus on the development of chip technology, according to the Financial Times. It claims the agreement will also involve a Japanese research institute that is being set up for this purpose, with help from Japan’s universities and other publicly funded research groups.

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IBM last year claimed to be the first company in the world to show off 2nm chips, and was also the first to show 5nm and 7nm wafers previously, although Big Blue does not mass-produce the chips itself. Taiwan’s TSMC disclosed details of its upcoming 2nm process in June, and said it intends to start production in 2025.

Also in Japan, troubled Toshiba has cut its full-year operating profit forecasts after a 75 percent drop in second quarter profits [PDF]. It said earnings had been hit by factors including falling demand in the hard disk drive market and has cut its forecast for the financial year ending in March by about a quarter to 125 billion yen ($885 million). ®