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Prime Minister <keyword id="19895781" type="General" weightage="20" keywordseo="narendra-modi" source="keywords">Narendra Modi</keyword> urged CEOs of US majors to take advantage of India's growth story as the country is making all efforts to become the third largest economy of the world in his third term. India is currently the fifth largest economy of the world after the US, China, Germany and Japan with a GDP of around USD 3.9 trillion. India has been the fastest growing large economies of the world with GDP growth rate of over 7 per cent for the last three consecutive years. Addressing CEOs of the large US tech firms on Sunday, Modi said India will make every effort to become the third largest economy in the world in his third term (2024-29). Companies should take advantage of India's growth story for collaboration and innovation by co-developing, co-designing, and co-producing in India for the world, harnessing the opportunities from the country's economic and technological growth, he said. Assuring the business leaders of India's deep commitment to the protection of intellectual property and to fostering tech innovation, Modi highlighted the economic transformation happening in the country, particularly in electronics and information technology manufacturing and semiconductors. Modi asserted that his government was committed to making India a "global hub of <keyword id="20073013" type="General" weightage="20" keywordseo="semiconductor-manufacturing" source="keywords">semiconductor manufacturing</keyword>". The meeting took place at the Lotte <keyword id="19904497" type="General" weightage="20" keywordseo="New-York" source="keywords">New York</keyword> Palace Hotel on Sunday during the second leg of Modi's three-day US visit. It saw the participation of CEOs of 15 major US-based firms working on cutting-edge technologies such as AI, quantum computing and semiconductors. "Had a fruitful roundtable with tech CEOs in New York, discussing aspects relating to technology, innovation and more. Also highlighted the strides made by India in this field. I am glad to see immense optimism towards India," Modi said in a post on X. During the conference, Modi said technology collaboration and efforts such as the Initiative on Critical and Emerging Technologies (ICET) lie at the core of the India-US Comprehensive Global Strategic Partnership, according to a Ministry of External Affairs press release. Organised by the Massachusetts Institute of Technology (MIT) School of Engineering, the CEOs of top US tech firms, including Google CEO Sundar Pichai, Adobe CEO Shantanu Narayena, Accenture CEO Julie Sweet and NVIDIA CEO Jensen Huang attended the meeting. Others who participated in the roundtable included AMD CEO Lisa Su, HP Inc. CEO Enrique Lores, IBM CEO Arvind Krishna, Dr Noubar Afeyan, Chairman of Moderna, and Verizon CEO Hans Vestberg. Modi also talked about India's BIO E3 (biotechnology for environment, economy and employment) policy to develop the country into a biotech powerhouse and on the topic of AI, noted that India's policy is to promote AI for all, underpinned by its ethical and responsible use. The CEOs appreciated India's growing prominence as a global technology hub, driven by its innovation-friendly policies and flourishing market opportunities. They also expressed strong interest in investing and collaborating with India, agreeing that investing in startups would be a synergistic opportunity to innovate and develop newer technologies in the country. Others who attended the conference included Biogen Inc CEO Chris Viehbacher, CEO of Bristol Myers Squibb, Chris Boerner, Eli Lilly and Company CEO David A. Ricks, LAM Research CEO Tim Archer, GlobalFoundries CEO Thomas Caulfield, and the CEO of Kyndryl, Martin Schroeter. "Further cementing technology and business connect. PM @narendramodi interacted with the top tech leaders and CEOs of USA, in a Roundtable hosted by the Massachusetts Institute of Technology School of Engineering, in New York today. PM emphasised India's growth prospects and discussed initiatives to foster collaborations and innovation across diverse sectors," the official account of the MEA said in a post on X. The prime minister had a separate meeting with Krishna P Singh, CEO of Holtec International, which is into nuclear and solar power generation. They discussed Holtec's plan for expanding manufacturing in India and advancing energy cooperation, PMO India said in a post on X. Earlier on Sunday, Modi addressed the <keyword id="20115166" type="General" weightage="20" keywordseo="Indian-diaspora" source="keywords">Indian diaspora</keyword> at the packed Nassau Veterans Coliseum on Long Island in New York. He also held bilateral meetings with world leaders at the sidelines of the UN General Assembly session here. Modi reached New York on Saturday after attending the Quad Leaders' Summit hosted by President Joe Biden in Wilmington, Delaware. <div type="Article" hostid="261" msid="113516805" title="Why is Indian Prime Minister Narendra Modi visiting the US this weekend?" mstype="2" mssubtype="0"></div>

PM Modi invites US CEOs to take a 'byte' out of India's growing technology sector

<ul class="summary-list"><li>The tariffs Donald Trump proposed while campaigning could help create US semiconductor jobs.</li><li>Tariffs could also help US chipmakers compete with companies abroad that sell chips at lower prices.</li></ul>If president-elect Donald Trump follows through on his <a target="_blank" href="https://www.businessinsider.com/companies-raising-prices-trump-tariffs-inflation-goods-getting-more-expensive-2024-11">campaign promise to impose tariffs</a>, the domestic semiconductor industry could see job gains.Industry experts told Business Insider that tariffs on foreign-made chips could help level the playing field for US chipmakers, which are <a target="_blank" class="" href="https://www.businessinsider.com/intel-chip-troubles-problem-us-economy-domestic-production-chips-act-2024-11">facing fierce competition</a> from their counterparts abroad. The tariffs could also encourage US businesses to source more chips domestically and help persuade chipmaking giants, like the Taiwan-based <a target="_blank" href="https://www.businessinsider.com/tsmc-making-apple-iphone-chips-helps-us-semiconductor-bet-2024-10">TSMC</a>, to keep building factories in the US. These developments could aid job growth in the US semiconductor industry, though experts disagreed on how much.Trump's proposed tariff policies include a 60% tariff on goods coming from China and up to a <a target="_blank" class="" href="https://www.businessinsider.com/companies-raising-prices-trump-tariffs-inflation-goods-getting-more-expensive-2024-11">20% tariff</a> on all imports, including chips. US companies source many of the chips needed to power items like iPhones and washing machines from abroad: The US share of overall chip production fell from <a target="_blank" href="https://www.businessinsider.com/why-us-doesnt-make-chips-semiconductor-shortage-2021-4">37%</a> of the world's supply in 1990 to roughly <a target="_blank" href="https://www.whitehouse.gov/briefing-room/statements-releases/2024/08/09/fact-sheet-two-years-after-the-chips-and-science-act-biden-%E2%81%A0harris-administration-celebrates-historic-achievements-in-bringing-semiconductor-supply-chains-home-creating-jobs-supporting-inn/#:~:text=As%20a%20result%20of%20these,Vice%20President%20Harris%20took%20office.">10%</a> today.In an <a target="_blank" href="https://open.spotify.com/episode/0e9ynAH6hmZIIeOx0SaGQu">interview</a> with podcaster Joe Rogan in October, Trump criticized the Biden administration's <a target="_blank" href="https://www.businessinsider.com/intel-chips-act-funding-all-hands-meeting-2024-11">CHIPS Act</a> legislation, which included $52.7 billion in tax breaks and subsidies for companies in the semiconductor industry. He said that the federal government should have implemented tariffs instead to motivate global chipmakers to build more factories in the US, which would then create jobs."You didn't have to put up $0.10," Trump said. "You could have done it with tariffs. You tariff it so high that they will come and build their chip companies for nothing."To be sure, the impacts of a tariff policy on chips could be mixed. Jeff Koch, an analyst at the semiconductor research and consulting firm SemiAnalysis, told BI that tariffs could lead to higher prices for goods containing chips, such as cars, electronics, and appliances. He added that US chipmakers could likely benefit from these tariffs because it could help them compete with companies abroad that sell chips at lower prices.The Trump campaign did not respond to a request for comment.<h2 id="dc733634-a51d-47cf-a7b9-405bdfac9e61">Tariffs on chips could boost construction and manufacturing jobs</h2>Patrick Moorhead, founder, CEO, and chief analyst at the research and advisory firm Moor Insights and Strategy, told BI that tariffs could increase the number of US chip manufacturing jobs. He added that he thinks the policy could incentivize chipmakers like TSMC and Samsung, which is based in South Korea, to boost manufacturing in the US."The cost of manufacturing in the US for Samsung and TSMC would be lower than a 30% to 40% tariff on <a target="_blank" href="https://www.businessinsider.com/quartz-mine-computer-chips-hurricane-helene-spruce-pine-semiconductor-2024-9">wafers</a> and <a target="_blank" href="https://www.businessinsider.com/us-ai-chip-production-manufacturing-nvidia-labor-china-taiwan-korea-2024-4">packaging</a>," he said, referring to key components of the chipmaking process.Jeff Ferry, chief economist at the Coalition for a Prosperous America, a nonprofit that advocates for increasing domestic manufacturing, estimated that tariffs could create roughly 100,000 jobs at US chip manufacturers and their suppliers.He said this estimate was partly based on a <a target="_blank" class="" href="https://www.semiconductors.org/wp-content/uploads/2021/05/2021-Jobs-Report_2-pager.pdf">report</a> published in 2021 by the Semiconductor Industry Association — a trade association and lobbying group — that said a $50 billion investment would help create an estimated 10 additional chip factories in the US. That could add about 42,000 direct jobs at the companies building these factories and 101,500 indirect jobs at chipmakers' suppliers, per the report.Ferry said he thought chip tariffs could lead to the creation of roughly 10 additional factories, which led him to come to the 100,000 jobs estimate. In August, the White House <a target="_blank" href="https://www.whitehouse.gov/briefing-room/statements-releases/2024/08/09/fact-sheet-two-years-after-the-chips-and-science-act-biden-%E2%81%A0harris-administration-celebrates-historic-achievements-in-bringing-semiconductor-supply-chains-home-creating-jobs-supporting-inn/">said</a> that investments supported by CHIPS Act funding would help create 115,000 construction and manufacturing jobs."Tariffs on chips, particularly legacy chips like those used in autos, could successfully shift production back to the US," Ferry said.Samsung did not respond to a request for comment. Intel and TSMC did not respond to a question about what impact a Trump administration tariff policy would have on each company's job creation plans in the US.An Intel spokesperson pointed to a <a target="_blank" href="https://www.intel.com/content/www/us/en/newsroom/news/us-chips-act-intel-direct-funding.html#gs.i5ie0q">press release</a> from March, which said the company's $100 billion investment in the US over the next five years is expected to create more than 10,000 jobs at Intel and nearly 20,000 construction jobs. TSMC pointed to a <a target="_blank" href="https://pr.tsmc.com/english/news/3122">press release</a> from April, that said TSMC's investments in three Arizona chip factories are expected to create roughly 6,000 company jobs, more than 20,000 construction jobs, and tens of thousands of indirect supplier and consumer jobs.Stephen Ezell, the vice president for global innovation policy at the Information Technology and Innovation Foundation, said that the effectiveness of a tariff on chips could be limited, in part because many chips aren't imported <a target="_blank" class="" href="https://www.usitc.gov/publications/332/executive_briefings/ebot_cellular_phones_and_covid.pdf">directly</a> into the US: He said they often come embedded into finished products like <a target="_blank" class="" href="https://www.usitc.gov/publications/332/executive_briefings/ebot_cellular_phones_and_covid.pdf">smartphones</a> or computers.For example, he said that in most cases, chips that TSMC manufactures in Taiwan for Apple are sent to <a target="_blank" class="" href="https://www.theatlantic.com/technology/archive/2022/12/tsmc-apple-memory-chip-production-us-china-taiwan-relations/672593/">China</a> or <a target="_blank" class="" href="https://www.cnbc.com/2024/04/10/apple-made-14-billion-worth-of-iphones-in-india-in-shift-from-china.html">India</a> to be incorporated into a product like an iPhone. Therefore, the chip wouldn't be subject to a US tariff but the iPhone would.When deciding whether to build a chip factory in the US, Ezell said several factors — including wage rates, the labor talent pool, and tax policy — would be bigger considerations for companies than the country's tariff policy. But if tariffs proved to be the deciding factor in a company's decision to invest in the US, then Ezell said the policy could arguably be credited with boosting employment in the semiconductor industry."If a company did decide not to launch a factory elsewhere and instead launch it in the United States, then yes, this dynamic could lead companies to hire more," he said.Do you work in the US semiconductor industry? Reach out to this reporter at <a target="_blank" href="mailto:jzinkula@businessinsider.com">jzinkula@businessinsider.com</a>

Trump's trade restrictions could be good for American semiconductor jobs

IT services major Tata Consultancy Services has entered into a partnership with the <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword>n Institute of Technology-Bombay, to develop what it said is India's first <keyword id="21836125" type="General" weightage="20" keywordseo="quantum-diamond-microchip-imager" source="keywords">quantum diamond microchip imager</keyword>. According to a statement from the IT services major on Tuesday, this to-be-developed sensing tool will hold the potential to unlock new levels of precision in the examination of <keyword id="20649044" type="General" weightage="20" keywordseo="semiconductor-chips" source="keywords">semiconductor chips</keyword>, reduce chip failures and improve the energy efficiency of electronic devices. Over the next two years, experts from <keyword id="19950203" type="General" weightage="20" keywordseo="TCS" source="keywords" meta.keywordsubtype="org" meta.entityname="TCS" meta.hostid="268" meta.entityid="TCS">TCS</keyword> will work with Dr Kasturi Saha, Associate Professor in the Department of Electrical Engineering of IIT-Bombay to develop the tool. Semiconductor chips are an essential component of all modern electronic devices. These chips act as the brain of devices across industries such as communications, computing, healthcare, military systems, transportation, clean energy, and what not. Professor Saha said, "By working together, we aim to transform various sectors, including electronics and healthcare, and propel India forward through ground-breaking technologies and products aligned with National Quantum Mission's Quantum Sensing and Metrology vertical." Dr Harrick Vin, Chief Technology Officer, TCS, noted that the Second Quantum Revolution is progressing at an unprecedented speed, making it imperative to pool resources and expertise to build cutting-edge capabilities in sensing, computing, and communication technologies. "We firmly believe this initiative will have a transformative impact on various industries and society, with applications ranging from electronics to healthcare, and beyond. By working together, we can drive innovation and create a brighter future for all," said the CTO. National Quantum Mission, an initiative of the central government, aims to position the nation as a global quantum technology leader. As semiconductors continue to shrink in size, traditional sensing methods lack the precision and capabilities to detect anomalies in the chips, TCS asserted. The to-be-developed Quantum Diamond Microchip Imager can image magnetic fields, enabling a non-invasive and non-destructive mapping of semiconductor chips, much like an MRI at a hospital. It uses the defects in a diamond's structure, known as Nitrogen-Vacancy (NV) centers, together with the other hardware and software for detecting and characterizing anomalies in semiconductor chips. The semiconductor industry in India is still in a nascent stage, with various local and multinational companies intending to tap its vast potential. Union Minister for Communications and Electronics and IT, Ashwini Vaishnaw, earlier this year said, that by the end of 2024, India would witness the launch of the first indigenous semiconductor chip. Currently, four semiconductor units -- three in Gujarat and one in Assam -- are in under construction stage. SEE ALSO:<a href="https://www.businessinsider.in/stock-market/news/awfis-space-solutions-ipo-allotment-how-to-check-allotment-gmp-listing-date-and-more/articleshow/110467409.cms" target="_blank"></a> <a href="https://www.businessinsider.in/stock-market/news/awfis-space-solutions-ipo-allotment-how-to-check-allotment-gmp-listing-date-and-more/articleshow/110467409.cms" target="_blank">Awfis Space Solutions IPO allotment – How to check allotment, GMP, listing date and more</a><a href="https://www.businessinsider.in/tech/mobile/news/samsung-galaxy-f55-with-leather-back-launched-in-india-starting-at-26999/articleshow/110462026.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/samsung-galaxy-f55-with-leather-back-launched-in-india-starting-at-26999/articleshow/110462026.cms" target="_blank">Samsung Galaxy F55 with leather back launched in India starting at ₹26,999</a><a href="https://www.businessinsider.in/tech/news/lenovo-loq-15-review/articleshow/110456546.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/news/lenovo-loq-15-review/articleshow/110456546.cms" target="_blank">Lenovo LOQ 15 review – gaming laptop with a sturdy design</a>

TCS ties up with IIT Bombay to develop India's first sensing tool for semiconductor chip imaging

Chipmaker <keyword id="20004922" type="General" weightage="20" keywordseo="AMD" source="keywords" meta.keywordsubtype="org" meta.entityname="AMD" meta.hostid="261" meta.entityid="AMD">AMD</keyword> is poised to power the surging demand for <keyword id="21517898" type="General" weightage="20" keywordseo="AI-compute" source="keywords">AI compute</keyword> with its wide range of product portfolio, the company's Chief <keyword id="19901571" type="General" weightage="20" keywordseo="technology" source="keywords">Technology</keyword> Officer Mark Papermaster said on Friday. AI compute refers to processing of data using artificial intelligence or machine learning algorithms. Marking 55 years of AMD (Advanced Micro Devices), Papermaster in a blog post looked back on five years of growth and innovations at the company, while also looking ahead to the next five years. He said the future of technology will be born from open ecosystems and deep industry partnerships that drive true innovation. "We're in a unique position to power increased demand for AI compute based on our broad portfolio of compute engines, deep relationships with customers across a diverse set of markets, and open software capabilities. We have a strong foundation of <keyword id="20053383" type="General" weightage="20" keywordseo="data-centre" source="keywords">data centre</keyword> products and customer collaboration across cloud and enterprise, and leadership products for AI PCs," he wrote. He said AMD has shifted from unique product silos to a modular IP portfolio, connected by a single AI software stack for easy deployment, and called it a 'holistic design approach'. "We need to speed our development by using more AI applications in our internal workflows to boost our productivity...We look forward to discovering new methods to optimise efficiency and experiment with new technologies that have potential," he said, adding that AI is poised to become more ubiquitous and consequential than the advent of the Internet. Papermaster further said that AMD will make some 'exciting' announcements at Computex (Taipei), an annual computer exhibition set to be held in June this year. Looking back, he said, "We made the call over a decade ago to leverage our strength and heritage in high-performance computing and invest for the future. Those bets have paid off as all our markets now demand the utmost in compute efficiency (performance per Watt of energy expended), and AI enablement. "...Our growth hasn't come overnight. AMD technology powers the daily lives of billions of people around the world, and in the last five years we've expanded the number of markets we serve." He said that the IT corporation has steadily increased investments in research and development for the past five years to be in line with the growing demand for compute performance and efficiency. "...Our research and development investment has nearly quadrupled, from USD 1.5 billion in 2019, to USD 5.9 billion in 2023, and we plan to continue to invest in developing groundbreaking technologies that show early promise," he said. He added that since 2019, AMD and the <keyword id="20149900" type="General" weightage="20" keywordseo="semiconductor-industry" source="keywords">semiconductor industry</keyword> have grown tremendously. "Global sales of semiconductors grew from USD 412.3 billion in 2019 to USD 574.1 billion in 2022, and are estimated to grow to USD 1 trillion by 2030," he said, adding that AMD is positioned to service the insatiable demand for more computing capacity. He said the company's headcount has more than doubled in the past five years. "Xilinx was the largest semiconductor acquisition when completed in 2022 adding incredible talent, leadership IP, and market expansion to adaptive compute markets with deep customer relationships," he said. Earlier this month, AMD posted its revenue at USD 5.47 billion (about Rs 45.6 crore) for the first quarter of 2024, up 2 per cent against the year-ago period. "AMD started the year strong, delivering record quarterly data centre segment revenue," AMD's EVP, CFO and Treasurer Jean Hu had said. "In addition, we drove solid gross margin expansion. Moving forward, we are well positioned to continue driving revenue growth and margin improvement while investing in the large AI opportunities ahead." SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/news/global-smartphone-shipments-grow-by-6-in-q1-2024-samsung-retakes-the-top-spot/articleshow/109817280.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/global-smartphone-shipments-grow-by-6-in-q1-2024-samsung-retakes-the-top-spot/articleshow/109817280.cms" target="_blank">Global smartphone shipments grow by 6% in Q1 2024, Samsung retakes the top spot</a><a href="https://www.businessinsider.in/business/auto/news/electric-two-wheeler-sales-crater-in-april-2024-as-prices-increase-amid-reduced-subsidies/articleshow/109806054.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/news/electric-two-wheeler-sales-crater-in-april-2024-as-prices-increase-amid-reduced-subsidies/articleshow/109806054.cms" target="_blank">Electric two-wheeler sales crater in April 2024 as prices increase amid reduced subsidies</a><a href="https://www.businessinsider.in/business/auto/webstories/bajaj-pulsar-ns400z-launched-at-1-85-lakh-becomes-cheapest-400cc-bike-in-the-country/slidelist/109810458.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/auto/webstories/bajaj-pulsar-ns400z-launched-at-1-85-lakh-becomes-cheapest-400cc-bike-in-the-country/slidelist/109810458.cms" target="_blank">Bajaj Pulsar NS400Z launched at ₹1.85 lakh, becomes cheapest 400cc bike in the country</a>

AMD set to fuel growing demand for AI compute, says CTO

<keyword id="19986399" type="General" weightage="20" keywordseo="Tata-Electronics" source="keywords" meta.keywordsubtype="org" meta.entityname="Tata Electronics" meta.hostid="261" meta.entityid="Tata Electronics">Tata Electronics</keyword> on Thursday said it has concluded an agreement with Taiwan-based Powerchip <keyword id="20073013" type="General" weightage="20" keywordseo="semiconductor-manufacturing" source="keywords">Semiconductor Manufacturing</keyword> Corporation, which will provide technology support for the Dholera wafer fab of the Indian tech major. As per the agreement, PSMC will provide design and construction support to build India's first AI-enabled greenfield fab in Gujarat, license a broad portfolio of technologies and provide engineering support to the fab unit. "We are pleased to partner with PSMC, whose technology and expertise will significantly accelerate our roadmap to pioneer semiconductor manufacturing in India. It will position us to play a key role in the growing semiconductor market to serve global customers," Tata Sons Chairman N Chandrasekaran said. The company is setting up a chip manufacturing unit in Dholera at an investment of up to Rs 91,000 crore ( about USD 11 billion). "<keyword id="19924335" type="General" weightage="20" keywordseo="Tata-Group" source="keywords" meta.keywordsubtype="org" meta.entityname="Tata Group" meta.hostid="261" meta.entityid="Tata Group">Tata Group</keyword>'s multi-fab vision for Dholera is projected to create over 1,00,000 skilled jobs," the statement said. Tata Electronics' Dholera-based Fab will have a manufacturing capacity of up to 50,000 wafers per month. "This partnership represents a win-win situation, as it positions PSMC and the Taiwanese ecosystem to gain a significant first-mover advantage in the rapidly expanding Indian market while helping India achieve self-reliance in semiconductor manufacturing," Powerchip Group, Chairman and CEO of PSMC, Frank Huang said. SEE ALSO:<a href="https://www.businessinsider.in/business/telecom/news/airtel-is-using-ai-powered-technology-to-block-spam-calls-and-messages/articleshow/113691942.cms" target="_blank"></a> <a href="https://www.businessinsider.in/business/telecom/news/airtel-is-using-ai-powered-technology-to-block-spam-calls-and-messages/articleshow/113691942.cms" target="_blank">Airtel is using AI-powered technology to block spam calls and messages</a><a href="https://www.businessinsider.in/stock-market/webstories/diffusion-engineers-ipo-quick-review-ipo-gmp-risk-factors-and-more/slidelist/113687580.cms" target="_blank"></a> <a href="https://www.businessinsider.in/stock-market/webstories/diffusion-engineers-ipo-quick-review-ipo-gmp-risk-factors-and-more/slidelist/113687580.cms" target="_blank">Diffusion Engineers IPO quick review – IPO GMP, risk factors and more</a><a href="https://www.businessinsider.in/stock-market/news/manba-finance-ipo-allotment-how-to-check-allotment-ipo-gmp-listing-date-and-more/articleshow/113667907.cms" target="_blank"></a> <a href="https://www.businessinsider.in/stock-market/news/manba-finance-ipo-allotment-how-to-check-allotment-ipo-gmp-listing-date-and-more/articleshow/113667907.cms" target="_blank">Manba Finance IPO allotment – How to check allotment, IPO GMP, listing date and more</a>

Tata Electronics, PSMC conclude pact for ₹91,000 crore Dholera chip manufacturing unit

<ul class="summary-list"><li>TSMC has begun producing chips for Apple at its Phoenix fab, people familiar with the matter said.</li><li>This development bodes well for the future of the US semiconductor industry, to which the Biden administration pledged $52 billion.</li></ul>The US's efforts to produce more <a target="_blank" href="https://www.businessinsider.com/us-china-tech-war-computer-chips-semiconductor-plants-costing-americans-2023-1">semiconductor chips</a> have encountered some challenges over the past few years, but the tide may be turning.TSMC, the world's leading chipmaker, has begun producing A16 chips for Apple at one of its <a target="_blank" href="https://www.businessinsider.com/tsmc-phoenix-chip-semiconductor-factory-biden-global-economy-china-taiwan-2022-12">Phoenix semiconductor chip fabs</a> (or factories), two people familiar with the matter told Business Insider. One of the people said that full production levels have not yet been reached. Their identities are known to BI.<a target="_blank" class="" href="https://timculpan.substack.com/p/apple-mobile-processors-are-now-made">Tim Culpan</a>, an independent journalist who covers technology and is based in Taiwan, first reported the news last month.The chips, which Culpan reported are being produced in "small, but significant, numbers," mark a major development for the company, which <a target="_blank" href="https://pr.tsmc.com/english/news/2033">announced</a> plans in 2020 to invest billions of dollars in Arizona and create thousands of jobs. Additionally, it comes two years after Tim Cook, the CEO of Apple, announced that the company would be the "<a target="_blank" href="https://www.businessinsider.com/apple-tim-cook-america-us-made-chips-first-time-decade-2022-12">largest customer</a>" of TSMC's first Arizona fab and use US-made chips for the first time in nearly a decade.A TSMC spokesperson declined to comment on the company's US work with Apple. When asked about the progress on the company's first chip fab, the spokesperson said that the project is "proceeding as planned with good progression," and that the company is on track to be fully operational in the first half of 2025.Apple didn't respond to BI's request for comment.<h2 id="1819bf24-3dc2-49d1-a9d0-42044a61e24c">'A success story'</h2>Dylan Patel, a chief analyst at the semiconductor research and consulting firm SemiAnalysis, said stateside chip production for Apple is a key milestone."Despite many negative stories early on, this shows the fabs are on track and operating as expected — a success story," he told BI.Mark Muro, a senior fellow at the Brookings Institution, told BI that beginning the production of A16 chips — which have been used in some recent <a target="_blank" href="https://www.businessinsider.com/guides/tech/iphone-15-plus-review">iPhone models</a>, though not the new <a target="_blank" class="" href="https://www.businessinsider.com/guides/tech/iphone-16">iPhone 16</a> — is a very positive signal for the Apple-TSMC partnership."It suggests Apple has enough belief in the new US facility to dive right in with US production of one its most advanced mobile processors," he said, adding, "This is encouraging given some observers' skepticism US sites could reach TSMC standards anytime soon."TSMC's commitment to <a target="_blank" href="https://www.businessinsider.com/tsmc-arizona-semiconductor-chip-fab-taiwan-china-president-joe-biden-2024-4">building three</a> chip fabs on its Phoenix campus is key to the Biden-Harris administration's efforts to boost the US's production of the chips that power everything from iPhones to washing machines. In 2022, President Joe Biden signed the <a target="_blank" href="https://www.businessinsider.com/chips-act-bill-to-boost-us-chipmaking-competition-with-china-2022-7">CHIPS Act</a> into law, which included <a target="_blank" href="https://www.businessinsider.com/trump-taiwan-china-semiconductor-chips-us-economy-trade-biden-election-2024-7">$39 billion</a> in manufacturing incentives for chip production in the US. In addition to creating US jobs, the administration hopes to secure supply chains and make the US <a target="_blank" class="" href="https://www.businessinsider.com/asml-tsmc-semiconductor-chip-equipment-kill-switch-china-invade-taiwan-2024-5">less reliant</a> on advanced chips in Taiwan.<h2 id="8f73c768-4752-403c-b6e5-a20430cb553e">TSMC faced construction slowdowns and worker tensions in Arizona</h2>TSMC's investment in Arizona hasn't always been smooth.Last year, TSMC announced that the official opening of its first Arizona fab would be <a target="_blank" href="https://www.businessinsider.com/tsmc-taiwan-semiconductor-phoenix-arizona-factory-chipmaker-job-qualification-debate-2023-8">pushed back</a> from 2024 to 2025. And when the company announced plans to send technicians from Taiwan to train US workers, a local <a target="_blank" class="" href="https://www.businessinsider.com/tsmc-taiwan-semiconductor-phoenix-arizona-factory-chipmaker-job-qualification-debate-2023-8">Arizona labor union</a> protested due to concerns that American jobs would be threatened.Management and safety concerns have also led to some frustrations among TSMC's construction workforce in Arizona. Workers <a target="_blank" href="https://www.businessinsider.com/tsmc-phoenix-arizona-chip-factory-taiwan-semiconductor-management-safety-workers-2023-8">previously told BI</a> that managerial challenges had fueled construction delays, and some have accused the company of <a target="_blank" href="https://www.businessinsider.com/tsmc-phoenix-arizona-chip-factory-taiwan-semiconductor-management-safety-workers-2023-8">safety violations</a>. TSMC <a target="_blank" href="https://www.businessinsider.com/tsmc-phoenix-arizona-chip-factory-taiwan-semiconductor-management-safety-workers-2023-8">previously told BI</a> that it's committed to ensuring that its working conditions are safe.In 2022, TSMC's founder and former CEO Morris Chang told the Brookings Institute that the US's efforts to boost <a target="_blank" href="https://www.businessinsider.com/why-tsmc-chipmaker-investing-billions-us-cost-more-make-chips-2022-12">domestic chip production</a> would be "a wasteful, expensive exercise in futility," citing labor force and cost challenges.Despite these hiccups, TSMC said in April during an earnings call that the progress on its first Arizona fab was "<a target="_blank" href="https://www.businessinsider.com/tsmc-arizona-semiconductor-chip-fab-taiwan-china-president-joe-biden-2024-4">well on track</a>."TSMC's production of Apple chips is good news for Americans <a target="_blank" href="https://www.businessinsider.com/semiconductor-industry-jobs-salary-chips-phoenix-arizona-tsmc-students-2023-10">hoping to land jobs</a> in the industry, Patel said. That's because TSMC's early success suggests it will continue to invest in the US."This drives job growth not just at TSMC but for the entire ecosystem — fab construction, equipment vendors, etc. that are all needed to support the fab," Patel said. "While modern fabs are not especially labor intensive, they require highly-skilled workers and will operate for decades, meaning many high-quality, long-term jobs are being created."TSMC has said that it will <a target="_blank" href="https://www.businessinsider.com/tsmc-arizona-semiconductor-chip-fab-taiwan-china-president-joe-biden-2024-4">charge customers more</a> for chips made outside Taiwan due to higher manufacturing costs. But Patel said he doesn't expect this to have a material impact on the prices of Apple's products."US government subsidies were meant to offset differences in construction and other costs between Taiwan and the US to make the business viable for TSMC," he said, adding, "Neither Apple nor consumers should expect a price difference for these US-produced chips.Going forward, chip makers like TSMC will face another challenge once they're operating at full capacity: <a target="_blank" class="" href="https://www.businessinsider.com/semiconductor-certification-program-chipmaker-manufacturing-jobs-new-career-intel-tsmc-2023-8">finding workers</a>.According to a <a target="_blank" href="https://www.semiconductors.org/america-faces-significant-shortage-of-tech-workers-in-semiconductor-industry-and-throughout-u-s-economy/">report</a> published last year by the Semiconductor Industry Association, the US semiconductor industry faces a worker shortage of 67,000 workers by 2030, including technicians, computer scientists, and engineers. However, Patel said that he doesn't expect labor force challenges to materially impact production at TSMC specifically.Muro was also optimistic. He said he thinks TSMC's production of Apple chips would bode well for the future."This is an important signal that the American drive to re-shore high-quality chipmaking is well founded," he said.Do you work in the semiconductor industry and have a story to tell? Reach out to this reporter at <a target="_blank" href="mailto:jzinkula@businessinsider.com">jzinkula@businessinsider.com</a>.

Apple's Made-in-the-USA chips signal a turnaround for the US' big semiconductor bet

<ul class="summary-list"><li><a target="_blank" class="" href="https://www.businessinsider.com/tsmc-making-apple-iphone-chips-helps-us-semiconductor-bet-2024-10">Apple has increasingly used its own silicon chips</a> in its devices in recent years.</li><li>Two Apple execs told The Indian Express that the company has a "tremendous strategic advantage" in doing so.</li></ul>Apple says it has a "secret weapon" in its approach to making the chips that power many of its devices.The iPhone giant has been increasingly relying on <a target="_blank" class="" href="https://www.businessinsider.com/apple-chip-testing-lab-video-iphone-mac-silicon-2023-12">its own chips</a> for new devices, and two of the company's execs recently explained why they feel that gives it an edge.Tim Millet, Apple's vice president of platform architecture at Apple, and Tom Boger, Apple's vice president of Mac product marketing, <a target="_blank" class="" href="https://indianexpress.com/article/technology/tech-news-technology/exclusive-top-execs-explain-apple-chip-philosophy-9670865/">spoke with</a> The Indian Express about the company's silicon chipmaking approach."We don't make a bunch of chips and then decide where we are going to put them," Boger said. "We design our chips from the ground up for our products, and that is a tremendous strategic advantage that we have."The company also benefits from making chips strictly for its own use rather than being a traditional chip-maker that sells to other companies, Millet said."Folks who do make money that way have the burden of adding margin on top of whatever they buy," he told The Indian Express.Apple began making its own chips in 2010, starting with the A4 chip, which was used in the first-generation iPad as well as the iPhone 4. The company has increasingly turned to its own semiconductors in subsequent years — a strategy that gave it more control. However, it also came with added R&amp;D costs and <a target="_blank" class="" href="https://www.businessinsider.com/apple-m1-chip-risk-moving-away-from-intel-macbook-pro-2020-11">impacted the nature of its contracts with chipmakers like Intel</a> and Imagination Technologies.<div type="image" title="Apple M4" height="1356" width="2396" msid="115428143" hostid="261" sizebytes="94872"></div>Apple's latest chips, the M4 Pro and M4 Max, were introduced last month for the Mac.Millet said Apple silicon takes advantage of "three major components, the architecture, the design, and the process technology.""Our fourth tool, really our secret weapon, I think, is our ability to co-design these amazing chips with the system teams and the product designers as they are imagining possibilities," he told The Indian Express.Apple CEO Tim Cook announced in 2022 that <a target="_blank" class="" href="https://www.businessinsider.com/apple-tim-cook-america-us-made-chips-first-time-decade-2022-12">the company would start using chips made in the US for the first time in nearly a decade</a>, sourcing chips from Taiwanese chipmaker TSMC's Arizona plant and becoming "the site's largest customer."The decision came amid President Biden's efforts to boost domestic chip production and lessen reliance on chips manufactured abroad. The <a target="_blank" rel="" href="https://www.businessinsider.com/chips-act-bill-to-boost-us-chipmaking-competition-with-china-2022-7">CHIPS Act</a> he signed into law in 2022 set aside $52.7 billion for American semiconductor research, development, manufacturing, and workforce development, including <a target="_blank" rel="" href="https://www.businessinsider.com/trump-taiwan-china-semiconductor-chips-us-economy-trade-biden-election-2024-7">$39 billion</a> in manufacturing incentives for chip production stateside.<a target="_blank" class="" href="https://www.businessinsider.com/tsmc-making-apple-iphone-chips-helps-us-semiconductor-bet-2024-10">TSMC began producing chips for Apple</a> at one of its Phoenix, Arizona, plants earlier this year, sources familiar with the matter confirmed to BI.

Apple exec explains the company's 'secret weapon' when making its own chips

<ul class="summary-list"><li>This post originally appeared in the Insider Today newsletter.</li></ul>Welcome back! The fast-moving, big business of weight-loss drugs is already shifting to its next stage. Here's a rundown of <a target="_blank" href="https://www.businessinsider.com/upcoming-glp1-weight-loss-drugs-to-watch-2024-11">five upcoming pills and injections</a> to keep an eye on.In today's big story, Microsoft's massive bet on AI with Copilot <a target="_blank" href="https://businessinsider.com/microsoft-ai-artificial-intelligence-bet-doubts-marc-benioff-satya-nadella-2024-11">has yet to live up to the hype</a>, potentially raising alarms for everyone else investing in the space.What's on deck:<ul><li>Markets: You can still bet on politics <a target="_blank" href="https://www.businessinsider.com/top-political-prediction-bets-trump-2028-nominees-election-kalshi-polymarket-2024-11">even though the election is over</a>.</li><li>Tech: Why the Trump-Musk relationship is unlike anything <a target="_blank" href="https://www.businessinsider.com/elon-musk-donald-trump-elected-shadow-president-2024-11">we've ever seen in US politics</a>.</li><li>Business: Spirit Airlines has filed for Chapter 11 bankruptcy protection, but <a target="_blank" rel="noopener" href="https://www.businessinsider.com/spirit-airlines-chapter-11-bankruptcy-restructure-low-cost-airlines-2024-11">tells customers it'll keep flying</a>.</li></ul>But first, is this thing even worth it?If this was forwarded to you, <a target="_blank" href="https://www.businessinsider.com/subscription/newsletter/insider-today">sign up here.</a><h3 id="7fa5f018-5b05-4a37-a8dc-d3f89138bcb3">The big story</h3><h2 id="5fd547b9-ec52-41fc-8e08-4f4b27dd8097">A Copilot conundrum</h2><div type="image" title="Microsoft logo glitching" height="1000" width="1334" msid="115423174" hostid="261" sizebytes="160900"></div>Microsoft's challenges with its flagship AI product could be another red flag for an industry with high hopes for the tech.Business Insider's Ashley Stewart, our resident Microsoft expert, has a deep dive on Copilot <a target="_blank" href="https://www.businessinsider.com/microsoft-ai-artificial-intelligence-bet-doubts-marc-benioff-satya-nadella-2024-11">coming up short on the big expectations laid out for it</a> when it launched over a year ago.CEO Satya Nadella didn't hold back initially, describing Copilot as something that would "fundamentally transform our relationship with technology" when it was unveiled.But internally and among clients, that doesn't always feel like the case. One Microsoft executive told Ashley that Copilot offers useful results about 10% of the time."The rest of the time it's: Why do we even try?" they said.It's an unsettling realization considering the stakes of AI. Many companies — and arguably the entire US stock market — are banking on generative AI being revolutionary. And while Microsoft's bet on AI dwarfs almost everyone else's, its hangup with the tech is something a company of any size can relate to: Is this stuff worth it?It's also not the only challenge the generative AI space is navigating.Reports about OpenAI's newest AI model struggling to show big improvements raised questions about the <a target="_blank" href="https://www.businessinsider.com/openai-orion-model-scaling-law-silicon-valley-chatgpt-2024-11">tech hitting a performance wall</a>. CEO Sam Altman appeared to address it with a cryptic tweet: "<a target="_blank" href="https://www.businessinsider.com/sam-altman-ai-wall-slowdown-openai-2024-11">there is no wall</a>."Still, it's feeding concerns about the timeline for artificial general intelligence. AGI is the concept that autonomous computer systems outperform humans at most economically valuable work, but it appears <a target="_blank" href="https://www.businessinsider.com/agi-predictions-looking-stretched-openai-sam-altman-google-ai-2024-11">harder to achieve than previously anticipated</a>, writes BI's Alistair Barr.<div type="image" title="AI robot hand gripping a time bomb, displaying a countdown timer set to expire in 2025" height="1500" width="2000" msid="115423171" hostid="261" sizebytes="122298"></div>The counterargument is straightforward: It's still the early innings.Microsoft is adamant its Copilot investment is already paying off. Jared Spataro, a vice president of marketing for Microsoft 365, pointed Ashley to Copilot success stories like Lumen Technologies, which projects $50 million in annual savings from its sales team's use of Copilot.Some customers aren't necessarily worried either, as they continue to plow money into AI. A Flexera survey found OpenAI ranked fourth among vendors that IT leaders plan to <a target="_blank" href="https://www.businessinsider.com/openai-top-vendor-it-leaders-2024-11">spend the most with next year</a>.But tech players won't have forever to figure things out. Earlier this year, analysts at Barclays highlighted an under-the-radar risk to AI bets: <a target="_blank" href="https://markets.businessinsider.com/news/stocks/ai-stocks-risk-nvidia-gpus-blackwell-tech-outlook-depreciation-accounting-2024-8">the depreciation costs related to AI chips</a>. As firms look to stock up on GPUs, they run the risk of the tech no longer being relevant as new iterations emerge.And then there's the possibility of internal drama. Ashley previously reported on <a target="_blank" href="https://www.businessinsider.com/microsoft-pay-data-shows-how-much-more-ai-workers-make-2024-8">the pay disparity at Microsoft</a> between AI-focused employees and everyone else."AI is great and it might be the future, but when are you going to focus on your billpayers?" one employee told Ashley.<h3 id="77f31a4c-8462-4e3d-a71f-838cb79493fb">News brief</h3><h2 id="1fcd294b-3f53-425f-9f20-4093e8623b59">Top headlines</h2><ul><li>Meet the top four candidates Trump is <a target="_blank" rel="noopener" href="https://www.businessinsider.com/trump-treasury-kevin-warsh-marc-rowan-howard-lutnick-scott-bessent-2024-11">considering for Secretary of the Treasury</a>.</li><li>Biden authorizes Ukraine to use powerful ATACMS to strike inside Russia. The move is a <a target="_blank" rel="noopener" href="https://www.businessinsider.com/biden-ukraine-russia-atacms-authorization-2024-11">significant shift in US policy</a>.</li><li>Trump, Musk, and new cabinet picks celebrate election victory with <a target="_blank" rel="noopener" href="https://www.businessinsider.com/trump-musk-celebrate-election-victory-ufc-309-cabinet-picks-2024-11">surprise appearance at UFC</a>.</li></ul><h2 id="8120060b-ae66-48dc-b149-f0489a30ffa2">3 things in markets</h2><div type="image" title="Photo illustration of judge's gavel on colorfulbackground" height="960" width="1920" msid="115423175" hostid="261" sizebytes="501366"></div><ol><li>A lawsuit about trade secrets has a corner of Wall Street's data industry enthralled. Yipit, a Carlyle-backed provider of credit-card data, filed a lawsuit accusing two former salespeople of <a target="_blank" href="https://www.businessinsider.com/inside-yipits-lawsuit-against-2-former-employees-who-joined-mscience-2024-11">stealing intellectual property to use in their new roles at rival MScience</a>. The suit has the attention of the young, fiercely competitive industry that sells non-traditional data to investors looking for an edge.</li><li>Just because the election is over doesn't mean you need to stop betting on politics. Who will be the Republican nominee in 2028? Will Matt Gaetz be confirmed as attorney general? Will Trump create a national Bitcoin reserve? The prediction markets <a target="_blank" href="https://www.businessinsider.com/top-political-prediction-bets-trump-2028-nominees-election-kalshi-polymarket-2024-11">have plenty of political outcomes</a> to scratch your gambling itch.</li><li>It's giving the year 2000 for one legendary investor. Rob Arnott compared the current market to the dot-com peak in 2000. Arnott told BI <a target="_blank" href="https://www.businessinsider.com/stock-market-crash-rob-arnott-warns-bear-market-tech-bubble-2024-11">why a bear market could be forthcoming in the next couple of years</a> thanks to high valuations and AI optimism that is largely priced in.</li></ol><h2 id="f4b54806-7f81-450c-ba32-92560d4fae9b">3 things in tech</h2><div type="image" title="Elon Musk" height="900" width="1200" msid="115423177" hostid="261" sizebytes="159876"></div><ol><li>Elon Musk's incredible hold on US politics. Politics and money have always been intertwined, but the current relationship between the world's richest man and the president-elect is unprecedented. The result is Musk <a target="_blank" href="https://www.businessinsider.com/elon-musk-donald-trump-elected-shadow-president-2024-11">acting almost as a shadow president</a>.</li><li>A potential Trump trade plan beneficiary: US semiconductor jobs. If Trump's proposed trade plan is enacted, the American semiconductor industry could see hiring growth. Industry experts told BI that tariffs on foreign-made chips <a target="_blank" href="https://www.businessinsider.com/trumps-tariffs-chips-could-create-more-american-jobs-increase-prices-2024-11">could help level the playing field for US chipmakers</a>, which have faced tough competition from their global counterparts.</li><li>The OpenAI mafia swells its ranks. Nearly two dozen former employees have left the AI juggernaut and founded startups of their own. The latest defectors include OpenAI cofounder and former chief scientist Ilya Sutskever and former chief technology officer Mira Murati. <a target="_blank" href="https://www.businessinsider.com/former-openai-employees-who-left-launch-vc-backed-ai-startups-2024-1">See what they're up to now</a>.</li></ol><h2 id="9260fa45-d397-4b3c-b4f8-4bb193976216">3 things in business</h2><div type="image" title="A $100 bill on top of a house" height="1500" width="1992" msid="115423179" hostid="261" sizebytes="339688"></div><ol><li>Four ways Trump's housing plans could hurt homebuyers and three ways it could help. Trump promised to make housing more affordable in part by deporting millions of immigrants, slashing construction regulations, and building houses on federal land. <a target="_blank" href="https://www.businessinsider.com/trump-high-home-prices-housing-mortgage-rates-deregulation-tariffs-immigration-2024-11">Here's how experts think that would actually pan out</a>.</li><li>Spirit Airlines has filed for Chapter 11 bankruptcy protection. The budget airline has struggled since a planned merger with JetBlue was called off in March. In an open letter to customers, it said people can continue to book tickets and fly as normal as it <a target="_blank" rel="noopener" href="https://www.businessinsider.com/spirit-airlines-chapter-11-bankruptcy-restructure-low-cost-airlines-2024-11">undergoes financial restructuring</a>.</li><li>Walmart might be just fine under Trump's proposed trade plan. Target, not so much. As America's grocery king, Walmart US makes nearly 60% of its revenue from groceries, which are predominantly domestic. But Target often relies on imported merchandise, such as apparel and beauty. <a target="_blank" href="https://www.businessinsider.com/target-walmart-trump-tariffs-exposure-analysts-2024-11">Walmart also has another key advantage: scale</a>.</li></ol><h2 id="1ad7b482-3f4b-44b4-81b6-a864aa386478">In other news</h2><ul><li>Disney CEO Bob Iger is moving to cement his legacy <a target="_blank" href="https://www.businessinsider.com/bob-iger-disney-earnings-guidance-succession-legacy-chapek-media-analysis-2024-11">by undoing his biggest mistake</a>.</li><li>Shoppers and businesses are <a target="_blank" rel="noopener" href="https://l.businessinsider.com/a/click?_t=c8e10479a20f45bba5aad6c5f6fbb009&amp;_m=c30b8703d160410398dd34e9584c94a3&amp;_e=i25E5ONB4tMiXtE06VeSaaFdC9RBeKEf6Am3QwaEcB2E4JdSqnDqmYr-387ig-ruhUxPoPCaat-voaDbfD_6S9r_lRX7w-hriYUuLZLf0oBVVklUgTGSC4rQQEsaV2VrmBmyEJBbhb5t_4ii9kzf5mGNs24JHBU4kD2t77qvgLde0_hccfFyZJGyX-HSEOcVt3hm2j3fy4fJUboGG4PKvgV09z0iPgS9Sd9YYBa5vfJF0tPkg6nqTPSf_-4F-a8aB1csTjQJYq2n-O1Ho511puOlxNeZs4WzL5ZST0WJkZqjescVMWVojaLY68-GnLbrAONhAtYwR4sRYyo_gVAswrtOyO2OjgTQ7GPu_kEO5SvlrvfmHChZsIOFVxvPWR7cGcH5q-QsclhVCpi1tyVirT8OKMZUsBjylVY0fJJZOSkOO4NwglFhyDOfQDrbf0_ErXhpUTPhEJeNs9bRlNwOVGxCBs2oCYN7T81FPiuSVJw%3D">stockpiling to avoid potential price hikes</a> before Trump takes office.</li></ul><h2 id="9f5d80ac-3466-429f-a50a-2ffbb70c65ff">What's happening today</h2><ul><li>G20 summit begins in Rio de Janeiro.</li></ul>The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Grace Lett, editor, in Chicago. Ella Hopkins, associate editor, in London. Hallam Bullock, senior editor, in London. Amanda Yen, fellow, in New York.Milan Sehmbi, fellow, in London.

Microsoft Copilot's underperformance is the latest red flag for investments in AI

<ul class="summary-list"><li>OpenAI chief Sam Altman urged would-be founders to bet on AI.</li><li>The space is developing rapidly and is widely underestimated, he said.</li></ul>Sam Altman has some galvanizing advice for aspiring tech entrepreneurs: The rise of AI has made it the best time yet to build a company, he said.In an <a target="_blank" class="" href="https://www.youtube.com/watch?v=xXCBz_8hM9w&amp;t=47s">interview</a> with Y Combinator President and CEO Garry Tan, the OpenAI chief likened the AI boom to other turning points in tech, including the rise of mobile, the advent of the internet, and the semiconductor revolution."With each successive major technological revolution, you've been able to do more than you could before," Altman said.At the same time, he acknowledged that being able to solve OpenAI's funding problem early on — with money from his previous ventures — was "very helpful" in getting the company off the ground, as it would've been difficult to find other investors otherwise.And despite their <a target="_blank" class="" href="https://www.businessinsider.com/history-of-elon-musk-and-sam-altman-relationship-feuds-2023-3">contentious relationship today</a>, Altman said he was "very grateful" to <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk">Elon Musk</a> for helping to fund OpenAI in its early days.Since then, Musk has bashed and sued the company on multiple occasions, accusing it of deceiving him into becoming a cofounder. OpenAI <a target="_blank" class="" href="https://www.businessinsider.com/openai-elon-musk-ai-lawsuit-sam-altman-harassing-legal-battle-2024-10">hit back last month</a>, saying Musk was harassing the company for "his own competitive advantage" in the name of his rival firm, xAI.Musk also has <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-mad-openai-asking-investors-not-to-fund-xai-2024-10">called OpenAI "evil"</a> for reportedly asking investors not to back its AI rivals, including his own, following its most recent $6.6 billion funding round.Meanwhile, Altman said the time is ripe for founders because AI is developing "a lot faster than people are appreciating right now," and the technology is being widely underestimated — including by the founders of billion-dollar companies. "Bet on this tech trend," Altman said. "We are not near the saturation point."This comes as <a target="_blank" class="" href="https://www.businessinsider.com/openai-one-step-closer-becoming-profit-company-report-2024-11">OpenAI is making moves to transition to a for-profit business structure</a> after operating as a nonprofit for nearly a decade — including preliminary discussions with California's attorney general's office.At the same time, Altman warned that while AI can provide "short-term explosions of growth," it doesn't automatically spell success for startups. "You still have to build something of enduring value."In the future, Altman said he can foresee a world where a company is making billions of dollars and has fewer than 100 employees."I don't know what to make of that other than it's a great time to be a startup founder," he said. "It's like one person plus 10,000 GPUs. Pretty powerful."Still, while the <a target="_blank" class="" href="https://www.businessinsider.com/sam-altman-openai-raising-money-strawberry-after-rough-start-year-2024-9">polarizing executive</a> has said artificial general intelligence, or AGI is imminent, <a target="_blank" class="" href="https://www.businessinsider.com/agi-predictions-sam-altman-dario-amodei-geoffrey-hinton-demis-hassabis-2024-11#andrew-ng-6">some researchers believe it's further afield</a>.OpenAI did not immediately respond to a request for comment from Business Insider.

Sam Altman thanks Elon Musk for helping to initially bankroll OpenAI — and says now is a great time for tech founders

<ul class="summary-list"><li>Lawmakers and Wall Street analysts are worried about the future of the chip giant Intel.</li><li>Intel is set to receive federal aid under the CHIPS Act to boost US semiconductor production.</li></ul>US policymakers are still betting that Intel is the nation's best shot at manufacturing chips.It's a long shot. The S&amp;P Dow Jones Indices said on November 1 that Intel is <a target="_blank" href="https://www.businessinsider.com/intel-struggles-qualcomm-deal-chip-industry-turmoil-2024-9">losing its 25-year spot</a> to Nvidia in the <a target="_blank" href="https://www.businessinsider.com/nvidia-replace-intel-dow-jones-industrial-average-2024-11">Dow Jones Industrial Average</a>. Intel's stock has dropped nearly 50% so far this year, and the company has faced billions in losses. It's also had sweeping layoffs, buyouts, and <a target="_blank" class="" href="https://www.businessinsider.com/intel-layoffs-cost-cutting-measures-pay-cuts-reduced-perks-2024-10">other setbacks.</a>The many moving parts of Intel's strategy could still help it recover from its recent setbacks if they're executed well. Business Insider spoke with industry analysts to ask what should go right for Intel to get back on track.Intel has specifically lagged in the age of generative AI compared to competitors like Nvidia, Qualcomm, and AMD, which have their chips produced by Taiwan-based chip giant <a target="_blank" class="" href="https://www.businessinsider.com/tsmc-power-players-14-execs-leading-worlds-biggest-chipmaker-2024-9">TSMC</a>.BI's Alistair Barr <a target="_blank" class="" href="https://www.businessinsider.com/intel-qualcomm-odd-couple-wont-solve-us-chipmaking-woes-2024-9">previously wrote</a> that since Intel is the only company manufacturing high-powered chips on American soil at scale, rather than outsourcing the job to Taiwan, the company is a key part of the bedrock of the country's technology ecosystem."Chips power the modern economy," he wrote. "If you have to get these components overseas, you're vulnerable."Given lawmakers' keen geopolitical and economic interests in maintaining the US's technological advantage, that means weighing all possible outcomes for Intel's future as the company struggles to gain its footing in the <a target="_blank" class="" href="https://www.businessinsider.com/us-china-new-technology-race-air-force-secretary-2024-10">AI race</a>."What's going on in Intel is not good, and being removed from the Dow is just sort of the cherry on the sundae," said Stacy Rasgon, a senior analyst at Bernstein Research.<h2 id="82763c21-cb66-4baf-9c2f-d09417cdc772">What needs to go right: 18A</h2>Intel's 18A process technology is key to its strategy and its next shot at a new process node <a target="_blank" class="" href="https://www.businessinsider.com/intel-roadmap-leadership-tsmc-samsung-analyst-skepticism-2025-2021-7">after struggling</a> with previous node upgrades. If the technology succeeds, Intel can win over customers and turn itself around.Intel has executed five improved chip nodes in the last four years, resulting in smaller and more powerful transistors, "which is a feat in itself," said Patrick Moorhead, CEO and chief analyst of Moor Insights and Strategy. Still, in recent years, Intel has failed to keep up with TSMC in the latest chip nodes.Moorhead added that Intel is investing to "catch up" to its competitors."Its 18A node appears to be healthy and competitive, which is the key to its turnaround and the ability to recruit more foundry customers," Moorhead said.Intel has announced Amazon as an 18A customer so far."You have to trust Intel to manufacture your chips on advanced processes, which they've just started adopting, efficiently and on time which they haven't done yet," said Logan Purk, a senior analyst at Edward Jones.<h2 id="053cf5c5-cc4a-47d6-b22d-74bd1e17888b">Intel needs to balance the books</h2>Intel plans to spin out its semiconductor manufacturing business into an independent subsidiary called <a target="_blank" class="" href="https://www.businessinsider.com/intel-ceo-pat-gelsinger-turnaround-plan-aws-2024-9">Intel Foundry</a>, separating the manufacturing process from its chip-design business. For this to work, the foundry business will need other major companies, including its rivals, to use Intel to manufacture their chip designs in large volumes. This hasn't happened yet.Other chip companies that have separated their manufacturing and designing have succeeded, said Dan Morgan, a senior trust portfolio manager at Synovus. He pointed to <a target="_blank" class="" href="https://www.businessinsider.com/intel-amd-nvidia-chip-manufacturing-moores-law-fabless-2020-11">AMD spinning off</a> its manufacturing arm GlobalFoundries as an example, and he estimated that Intel's foundry business alone could be valued as high as $80 billion. Highlighting Intel's challenge here, GlobalFoundries only has a market cap of just $24 billion as of publication time.Intel CEO Pat Gelsinger has also said that Intel is making progress in cutting costs in their recent staff reductions and real estate sales."Balance sheet is an area of focus for investors given the company's aggressive capex plan and ongoing losses in the foundry business," Morgan said.Rasgon said Intel is facing a "dire emergency" but likely isn't so desperate as to declare bankruptcy or sell off portions of its business at a fire sale price. Moreover, Intel still <a target="_blank" class="" href="https://www.reuters.com/technology/intel-battles-amd-with-new-data-center-chips-2024-06-04">holds over 75%</a> of the market share of data center chips and <a target="_blank" class="" href="https://www.tomshardware.com/pc-components/cpus/amds-desktop-pc-market-share-skyrockets-amid-intels-raptor-lake-crashing-scandal-amd-makes-biggest-leap-in-recent-history">PCs</a>."It's not like the company's just bleeding out," Daniel Newman, CEO of the technology research and advisory firm Futurum Group, told BI.<h2 id="e50e85c0-01ba-4d89-a096-040aaf9c7576">A rescue plan from Washington, DC</h2>Washington's concerns about <a target="_blank" class="" href="https://www.businessinsider.com/why-nvidia-replacing-intel-dow-jones-industrial-average-explained-2024-11">Intel</a> have become a sharper focus as the company has continued to slip from its spot as a top chipmaker.Intel is set to receive billions from the federal government under the <a target="_blank" class="" href="https://www.businessinsider.com/intel-chips-act-funding-all-hands-meeting-2024-11">CHIPS and Science Act</a> to boost American semiconductor manufacturing — though the company hasn't received any funds yet.If Intel can contain costs and efficiently apply its grant funding, Newman said, "there is a possibility that it could get back to a level of profitability that would make it sustainable."The government has taken other steps to boost Intel. Gina Raimondo, the US secretary of commerce, took multiple private meetings and calls to urge chief executives from Google, Microsoft, Apple, Nvidia, and other firms to buy chips from Intel to shore up the company's manufacturing wing and solidify its role in US-based chip production," <a target="_blank" class="" href="https://www.nytimes.com/2024/10/24/us/politics/intel-chips-biden.html">The New York Times</a> reported last month.<a target="_blank" class="" href="https://www.businessinsider.com/what-second-trump-term-means-for-intel-2024-11">Under Donald Trump's</a> presidential administration, Intel could receive support for domestic manufacturing while facing higher tariffs and pushback on the <a target="_blank" rel="" class="" href="https://www.businessinsider.com/intel-chips-act-funding-all-hands-meeting-2024-11">CHIPS Act</a>."Under the incoming administration, which arguably has an even greater nationalist tone, homegrown companies actually stand to benefit," said Purk.Not everyone is convinced that government intervention will help Intel get back on track in chip manufacturing."It's all fine and dandy for the government to say, 'Yeah, we want you to use Intel,'" Rasgon said. "Like, that's great, but it's not going to happen unless Intel can deliver."<h2 id="97a3535f-a9d2-4efc-9d1f-18b25dba6859">Intel could face a breakup or a merger if things go wrong</h2>Intel's foundry business has been slow to take off, and the potential for it to reinvigorate the American chipmaking landscape hasn't stopped rumblings about a possible breakup — with competitors like Qualcomm reportedly interested in <a target="_blank" class="" href="https://www.businessinsider.com/qualcomm-intel-acquisition-chips-semiconductors-tsmc-2024-9">buying parts of Intel</a> — or policymakers in Washington discussing potential contingency plans.Officials from the Commerce Department and Sen. Mark Warner, who championed the CHIPS Act, met for precautionary strategy talks to discuss how the government should support Intel if it needs more help, <a target="_blank" class="" href="https://www.semafor.com/article/11/01/2024/concerns-grow-in-washington-over-intel">Semafor reported</a>. The report said they also discussed a potential merger between the company's chip design business and a competitor like AMD or Marvell."If, for some reason, this foundry thing continues to take longer, the losses continue to mount, the technological progress does not take hold, sales falter, or the company's ability to stay together does, I do believe that they are setting it up in that direction to be able to have options — whether they spin it off and take it public separately, or bring private equity into it, or they're able to bring a buyer to the table," Newman said.Intel, the Commerce Department, and a representative for Warner did not respond to requests for comment from BI.

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