Strategies for the U.K. semiconductor industry: lessons from the Alvey Program

Abstract

Semiconductor (SC) technology is vital to the health of the information technology (IT) industries. The U.K. Government-sponsored Alvey Program for research in advanced IT included a strategy for promoting research and development in the latest generation of SCs—very large scale integration (VLSI). This paper summarizes the main conclusions of a study which examined the Alvey VLSI Program in the light of international market and technological trends in SCs. The VLSI Program was timely and pro-active in establishing a coordinated R&D effort into VLSI. It was also correct to focus on specialist, application-specific integrated circuits (ASICs). Alvey succeeded in accelarating VLSI research and improving the links between the academic and industrial sectors. However, on its own Alvey was insufficient, either to overcome the weaknesses of the U.K. SC industry or to ensure that users have access to world-class components and technology. In order to ‘plug’ the technology gap between the U.K. and its main competitors, future U.K. Government policies should: encourage multinational SC producers to increase inward investment in the U.K., increase the supply of skilled engineers, provide selective support for U.K. firms in European SC ventures and introduce schemes to accelerate the use of VLSI chips in information technology systems. Although the Government is right to be sceptical of requests for subsidies to U.K. producers for the manufacture (or fabrication) of SCs, there is a pressing need for new initiatives to ensure that U.K. IT producers have access to world-class SC components and technologies.