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US-Japan AI Race on Pause as Tech Firms Join Forces for Semiconductor Collaboration

Last Updated July 9, 2024 1:34 PM
Giuseppe Ciccomascolo
Last Updated July 9, 2024 1:34 PM

Key Takeaways

  • Leading Japanese and US companies are joining forces to tackle the development of cutting-edge chip technologies specifically for generative AI.
  • US-JOINT prioritizes advancements in back-end semiconductor packaging.
  • Several big US tech companies are investing massively in Japan.

A new consortium, US-JOINT, consisting of 10 leading Japanese and US tech companies, has joined forces to drive forward semiconductor technologies for AI.

US-JOINT’s collaborative ethos and strategic focus come amid an intensified global race to develop state-of-the-art semiconductor technologies.

What’s US-JOINT Consortium

Semiconductor material leader Resonac Holdings announced  the formation of US-JOINT, a groundbreaking consortium focused on developing cutting-edge chip technologies for generative AI.

Headquartered in Silicon Valley, US-JOINT  will primarily tackle advancements in back-end semiconductor packaging, a crucial stage in chip development.

Traditionally, back-end semiconductor processing has been an Asian stronghold. US-JOINT strategically positions its R&D efforts closer to major US chipmakers in Silicon Valley.

The consortium boasts a formidable line-up. Six Japanese companies join forces, including Towa, a leader in chip manufacturing equipment, and Tokyo Ohka Kogyo, the world’s top photoresist producer. Four US firms round out the team, with Azimuth Industrial, a prominent player in semiconductor packaging, and KLA, a renowned chip toolmaker, adding their expertise.

Big Tech’s Investments In Japan

In 2023, Japan ranked 32nd globally in digital technology adoption and faces a significant shortage of digital workers, with only one million currently available versus a projected need of 2.3 million by 2026, as reported by the Japan Times.

Major tech firms are investing heavily in Japan’s cloud and AI infrastructure to address these challenges. AWS plans to invest $15.24 billion by 2027, focusing on expanding cloud facilities and addressing the digital skills gap through education and training.

Google Cloud is investing US$1 billion to enhance digital connectivity, including new subsea cables to improve connectivity between the US, Japan, and Pacific Islands, supporting its Japan Digitization Initiative.

OpenAI has launched its first Asia office and introduced a GPT-4 model optimized for Japanese. Sam Altman’s company promised faster performance in text translation and summarization. Furthermore, Oracle Japan will invest over US$8 billion over the next decade. It aims to expand Oracle Cloud Infrastructure and support digital sovereignty requirements.

NVIDIA collaborates  with Japanese digital infrastructure providers to develop crucial AI-focused cloud infrastructure. The Japanese government is allocating approximately $740 million to subsidize AI computing resources for local firms. It aims to build on previous efforts to boost sector involvement.

Microsoft To Spend $2.9 Billion

Highlighting Japan’s growing AI industry demands, Microsoft announced its plan to invest $2.9 billion over the next two years in April.

Microsoft currently operates Azure data centers in West Osaka and East Tokyo. Its investment will focus on deploying advanced GPUs for demanding AI workloads. This commitment marks Microsoft’s largest-ever investment in Japan.

Japanese Prime Minister Kishida has expressed appreciation for Microsoft’s investment. He acknowledged the company’s “significant contributions to the widespread adoption of generative AI in Japan.”

Recently, Kishida also hosted Meta CEO Mark Zuckerberg and Nvidia’s Jensen Huang at his residence in Tokyo. The politician and the tech executives discussed AI and the future of technology.

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