Ex-Google CEO Eric Schmidt warns U.S. must invest in semiconductors to counter China

Ex-Google CEO Eric Schmidt warns U.S. must invest in semiconductors to counter China

Washington, 6/6/2021

Former Google CEO Eric Schmidt has called on the U.S. government to build up its semiconductor industry to counter China, urging the country to „take a position and put money behind it.“

According to Schmidt, „it’s about a lot of money … that the United States is going to need to stay two semiconductor generations ahead of the Chinese,“ Schmidt said in an interview with CBS News on Wednesday.

Schmidt is currently chairman of the National Security Commission on Artificial Intelligence after leaving his position as an adviser to Google parent company Alphabet last year. The commission is tasked with making recommendations to the U.S. government on the use of artificial intelligence (AI) and other technologies related to defense and national security. In March, it released a report to Congress

(report to Congress ) in which it argues that „the United States can compete with China without ending joint AI research and cutting off all technology trade.“

The report recommends that the U.S. Department of Defense and the intelligence community achieve widespread AI readiness by 2025 and suggests new spending on related infrastructure, including in the semiconductor industry. Schmidt pointed out that so far, the U.S. has been able to meet semiconductor needs with chips made domestically, in South Korea and Taiwan, primarily by Taiwan Semiconductor Manufacturing Co (TSMC).

„It’s almost certain we can build a system [for making chips and attracting talent] as good as what TSMC did last year. The question is, can we do what they’re doing next year?“ said Schmidt.

„China has been trying to match Taiwan for the last 30 years,“ he said. „They haven’t been able to either, even though they’re 100 miles across the strait and there are a lot of TSMC fabs that are in mainland China. That shows you how difficult this technology is.“

In March, U.S. President Joe Biden unveiled a proposal for a $50 billion U.S. investment in semiconductor manufacturing and research, part of the White House’s broader $2 trillion infrastructure plan. Schmidt compared the U.S. spending on the industry to that of TSMC, which recently announced plans to spend $100 billion over the next three years to expand its chip capacity.

„It’s going to take billions of dollars of funding, which we believe is possible in the current climate,“ Schmidt said.