American MNC, IBM Corp. recently stated that it has collaborated with chip maker Rapidus, supported by the Japanese Government, to assist it in manufacturing the most innovative chips available.
The announcement has been made in the wake of the ongoing tensions between the U.S. and China over chips and the ban imposed by Washington on Beijing's access to innovative semiconductor technology.
Japan, which has been left far behind considering chip manufacturing, is now looking forward to catching up and making sure that automakers and IT companies do not fall short of any key component.
According to the announcement made by Japan last month, it plans to invest nearly 70 billion yen ($500 million) in Rapidus, a venture headed by tech firms like Sony Group Corp (6758.T) and NEC Corp (6701.T).
However, this is a small investment considering the chip manufacturing world, where plants cost billions of dollars to build, although sources say that there are more investments.
Speaking on the latest move, Dario Gil, Director of research, IBM.N (International Business Machines Corp's), stated that both companies plan to work together to form IBM's so-called 2-nanometer-node chips revealed last year.
In the chip industry, one-billionth of a meter, or a "nanometer," refers to specific technology instead the measurement. Generally, the smaller the number that leads to the word "nanometer" signifies the most advanced chip.
Upon being quizzed that if Japan could bounce ahead to manufacturing such innovative technology when its most recognized plant manufactures 40-nanometer chips today, Gil said, it's not that the country is a beginner.
Gil said that Japan already has immense strengths in the semiconductor industry and considering the perspective of materials and equipment, is a global leader in that space. The scientific and engineering expertise and the strong network of suppliers and partners around Japan are rich.
For the record, the new plant is planned to be in Japan. However, the companies are yet to announce the exact location.