Applied Materials, A*Star to set up S$150m lab to make advanced chips

Singapore

BUOYED by the performance of its last venture here, the world's largest chipmaking equipment maker Applied Materials (AM) will announce on Monday a S$150 million joint investment with Singapore's national research institute that will focus on advanced semiconductor technology.

AM also aims to then expand into manufacturing the products it develops and to bring these to the market in the not too distant future.

"If all goes to plan, we'll probably hit the market in a few years' time, and it will certainly enable your future generations of iPhones and Samsung Galaxies," said Russell Tham, AM's corporate vice-president and president for Southeast Asia, in an exclusive interview with The Business Times last week. "It depends on when the market adopts it - it could be 3-4 years' time."

AM supplies equipment, services and software for manufacture of semiconductors, flat panel displays, and solar products. The new research and development laboratory - a joint initiative between AM and the Agency for Science, Technology and Research (A*Star) - will be housed in Fusionopolis Two, a new three-tower complex that will be officially opened by Prime Minister Lee Hsien Loong on Monday.

The laboratory will start operations in the first half of next year and will occupy a 400 square metre Class 1 cleanroom. It has semiconductor process equipment that has been custom-designed and built by AM.

There will be 60 researchers and scientists working at the facility. They will undertake projects in collaboration with researchers from other A*Star institutes.

Mr Tham said that the laboratory will research and develop technologies for the fabrication of future generations of memory and logic chips that are used in smartphones, tablets and laptops.

"One of the main technological drivers for us is to be able to put more and more chips into smaller form factors," he said.

Meanwhile, researchers from three of A*Star's institutes will contribute to research in low-defect processing, ultra-thin film materials, analysing materials, modelling and simulation.

The laboratory is the second such collaboration of its kind between AM and A*Star. In 2012, the two organisations opened the Centre of Excellence in Advanced Packaging at Science Park II.

Said Mr Tham: "We've had good experience from the joint lab for R&D in packaging. We've ramped up our factory and gone from zero to one-third of our global coming output from Singapore."

Not only did Singapore gradually contribute to a significant portion of AM's global output, according to Mr Tham, its workforce also benefited from its presence.

"Today, we have about 600-700 people out there . . . the factory doesn't require any work pass permits," he said.

Referring to the new laboratory, Mr Tham reiterated: "We intend to manufacture the products from this R&D laboratory in Singapore."

The launch of the new laboratory comes at a time when Singapore's manufacturing sector is heading into the doldrums.

Figures released by the Economic Development Board (EDB) late last month showed that manufacturing output tumbled 7 per cent year-on- year in August this year.

The semiconductor industry, which took up about 60 per cent of the electronics cluster's total output, saw an 8.7 per cent contraction year- on-year in August.

This was better than the electronics cluster's 10.9 per cent drop, but still more severe than the average manufacturing output fall.

Despite this, A*Star managing director Raj Thampuran believes that the set-up of the new laboratory helps secure the future of the semiconductor industry in Singapore and gives the country a competitive advantage in manufacturing.

Terming collaborations such as this as "industry-ready research", Prof Thampuran said at the same interview last week that there is a need to align R&D with innovation and industrial output to contribute to economic growth.

"Because what you can do today is a consequence of what you sighted as opportunities that would have been industry-ready in the past," he said.

In addition to having the semiconductor sector contribute to the resilience of Singapore's economy, it also helps sharpen the country's competitive edge.

"The complex products that we're able to manufacture differentiates us from other countries that have difficulty doing the same," Prof Thampuran said. "Because you need technological prowess, you need the talent, skills that will allow you to deal with that kind of complexity."