“As we all know, semiconductors are a field where all-out national warfare is underway,” President Yoon Suk Yeol said, according to Reuters. “Win or lose, that depends on who can make cutting-edge semiconductors first.”

South Korea is one of the world’s top chipmaking nations, with its strength specifically lying in the memory market. Production has been booming recently, but the South Korean government would very much like the country to make more non-memory chips, where its share remains in the order of 2%. (The big beast, of course, remains Taiwan, which accounts for around a fifth of the world’s overall semiconductor industry, and which makes more than 90% of the most advanced chips.)

The new funding will mostly be used to provide low-interest loans for semiconductor firms’ private investments and to extend their tax incentives, and also to establish a fund for fabless firms—that is, chip companies that outsource the manufacturing to the likes of Taiwan’s TSMC—and for parts and equipment companies.

However, the Korea Herald reports, South Korea won’t be providing any direct subsidies. Countries like the U.S. may be going subsidy-mad—$39 billion of the $52 billion appropriated under its CHIPS and Science Act is being doled out in straight-up grants—but, according to Finance Minister Choi Sang-mok, those are countries that “have to build chip facilities from scratch.”

“Countries with decent chip manufacturing capability, like Korea and Taiwan, do not have direct subsidies,” Choi said, per the Herald. “What we are offering are tax benefits, and they are similar to subsidies in their character. When it comes to tax credits, we offer the highest level of incentives.”

According to recent Bloomberg number-crunching, governments worldwide have so far earmarked $380 billion to boost chip production. This is mostly down to the West’s gradual uncoupling from China and fears over a potential Chinese invasion of Taiwan, but—in the zoomed-out sweep of history—it’s also a return to the good old-fashioned economic model of making stuff yourself, rather than contracting production out to the someone on the other side of the world.

Speaking of the CHIPS Act, the latest beneficiary of Washington’s largesse is Absolics, which will be taking up to $75 million in American subsidies to develop and make a type of glass that will be used in advanced packaging—i.e., bundling different types of chip into a single chipset.

Investment in advanced packaging is crucial if you want to end up with the kind of power-efficient chipsets that are used in AI and high-performance computing. And at this point, it’s worth pointing out that Absolics is over 80% owned by … South Korea’s second-largest conglomerate, SK Group, which is also parent of the world’s second-biggest memory-chip maker, SK Hynix.

Meanwhile, the largest South Korean conglomerate and memory-chip maker, Samsung, is also happily raking in up to $6.4 billion in CHIPS Act subsidies so it can build out R&D and advanced packaging capacity in the U.S. All-out national warfare indeed!

More news below.

David Meyer

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NEWSWORTHY

OpenAI departures. Another OpenAI employee has quit over concerns about the company’s approach to AI safety. This time it’s policy research staffer Gretchen Krueger, who said she had actually resigned shortly before hearing of the more high-profile resignations of Ilya Sutskever and Jan Leike, Business Insider reports. “I share their concerns. I also have additional and overlapping concerns,” she said. In other OpenAI news, the company has struck another deal with a media group, this time News Corp, to use its content as AI-training fodder, News Corp’s Wall Street Journal reports.

Nvidia’s AI chip road map. Nvidia, which just had another blockbuster quarter, says it will increase the pace at which it releases new AI chips, with a new product appearing every year instead of every two years as is currently the case. CEO Jensen Huang said Nvidia would also match that cadence across its other chip releases, The Verge reports. “New CPUs, new GPUs, new networking NICs, new switches … a mountain of chips are coming,” Huang said.

Bluesky gets DMs. X rival Bluesky has finally got direct-messaging functionality, TechCrunch reports. The messages aren’t end-to-end encrypted yet, but they will be “down the line,” the company said. This is the latest example of the former Twitter’s competitors adopting features that its users have long taken for granted. Meta’s Threads (which still doesn’t have DMs) started testing a TweetDeck-like multi-column web interface a week ago.

SIGNIFICANT FIGURES

100%

—The proportion of Meta’s new AI advisory council who are white men.

IN CASE YOU MISSED IT

Nvidia announces threefold sales increase in another blowout earnings report—‘We’re racing every day,’ says CEO Jensen Huang, by Dylan Sloan

Top Apple exec acknowledges court-ordered makeover of iPhone app store payment system hasn’t done much to increase competition, by the Associated Press

FCC introduces effectively toothless proposal that would regulate AI everywhere except streaming, by the Associated Press

Big Tech employees missed out on $5.1 billion in 401(k) gains over the last decade because of fossil fuels, new research finds, by Andrew Behar (Commentary)

Bipartisan support of cryptocurrency is resurging in Congress. Here’s why, by Chris Perkins (Commentary)

A high bar for health tech startups, by Andrew Nusca

BEFORE YOU GO

Boeing Starliner delayed. Boeing and NASA have again delayed the maiden voyage of the aerospace company’s new Starline spacecraft, which is supposed to take astronauts to the International Space Station. This time, the delay is indefinite. It follows the discovery of a small helium leak in one of the craft’s modules, CNN reports. So SpaceX’s Crew Dragon and Russia’s Soyuz are still the only capsule programs that are able to get people up to and back from the ISS.