Why the American Foundries Act Does Not Go Far Enough
The American Foundries Act 2020 is a bipartisan bill that proposes spending as much as $25 billion on commercial microelectronics manufacturing ($15 billion), defense microelectronics grants ($5 billion) and R&D to secure U.S. leadership in microelectronics ($5 billion). The prioritization of stateside semiconductor manufacturing and development is crucial, as semiconductors are a platform technology and the base for much of the modern world, from airplanes to cell phones, and most crucially - defense capabilities. While the United States can be credited with the advent of semiconductor technology, recently, it has become too dependent on foreign manufactures. Due to this fact, the U.S. has opened itself up to strategic vulnerabilities across all industries, but especially in defense efforts.
The proposed American Foundries Act aims to address those vulnerabilities, but unfortunately, it does not go far enough. As the Act currently stands, the overall emphasis appears to be targeted toward the robust silicon presence. Essentially, policymakers seem to be prioritizing the relocation of large offshore fabrication facilities (fabs) to the United States, which is of course, important. However, the current Act falls alarmingly short in the future development of advanced semiconductor materials, and more specifically, diamond, a material proven to be optimal for semiconductors and coveted by foreign adversaries, in particular, China.
Unambiguously, lab-grown diamond has been identified as the most promising and ideal semiconductor material, garnering significant research and development efforts from institutions such as the US Department of Energy, US Army Research Laboratory, and China’s Hubei Space Bureau —the latter of which already known to be researching the material for advanced weapons usage. Across every industry, diamond has outperformed existing semiconductor materials, including silicon, silicon carbide and gallium nitride. Diamond enables us to address critical issues limiting performance in electronics and optics applications across key industries such as aerospace & defense, consumer electronics and more. To not have diamond called out specifically within the American Foundries Act is extremely shortsighted, and to a point, dangerous.
Huawei Technologies Inc. is a tech giant accused of acting as a private arm of the Chinese government and has been alleged to steal intellectual property from a number of powerhouse American tech companies, including Apple, T-Mobile and Cisco. In 2018, Huawei made an attempt to steal AKHAN Semiconductor’s Miraj Diamond® Glass technology. As the only diamond semiconductor fab in North America, we shipped a prototype of our Miraj Diamond® Glass technology to a lab in San Diego, Huawei Device USA, in an effort to license the breakthrough technology to the world’s second largest cell phone vendor.
Leading up to the deal, both companies agreed that Huawei would send the samples back to AKHAN within 60 days. Huawei also agreed to limit any test it might perform to not cause damage - a standard disclosure designed to deter reverse engineering of intellectual property. All documents complied with U.S. export laws, including provisions of the International Traffic in Arms Regulations (ITAR). ITAR governs the export of materials with defense applications, and diamond coatings are on the list because of their potential for use in laser weapons.
Two months after we sent Huawei our Miraj Diamond® Glass, the Chinese tech company missed the deadline to return the sample. A month after that, Huawei finally responded, and claimed they’d been performing “standard” tests on the ultrahard diamond glass. An image of the glass with a scratch on the surface accompanied the note. Eventually, Huawei sent the sample back. The ultra-hard glass was not only scratched, it was quite visibly and intentionally broken in two, and three shards of the diamond glass were missing.
Eventually, we approached the FBI, who immediately took interest in our claim and requested that the glass be sent to the Bureau’s research center in Quantico, VA. After analyzing the damaged prototype, the FBI concluded that Huawei had blasted it with a high energy laser, powerful enough to be sinter the material. When AKHAN questioned Huawei about the glass, Huawei admitted it sent the glass to China - a criminal violation of ITAR.
Additionally, we participated in an FBI sting targeting Huawei. At the 2019 Consumer Electronics Show in Las Vegas, AKHAN executives agreed to wear a wire to a meeting with our contacts at Huawei, where Huawei doubled down on sending the glass to China. The result of the sting operation was a FBI raid of Huawei’s San Diego office. Currently, The U.S. Justice Department is deciding how to try the criminal case against Huawei.
For the reasons detailed above, we feel as not having “diamond” called out specifically in The American Foundries Act 2020 is not only detrimental to American competitiveness in semiconductor, but more importantly, a great danger to American safety. The majority investment in the continuation of the aging silicon platform is the opposite of strategic, comparable to investing in stage coaches after the advent of the internal combustion engine. If the United States is committed to maintaining leadership in semiconductor technology and wants to keep the great citizens of this nation safe, it is imperative that policymakers have a thorough understanding of the strategic importance of diamond as a semiconductor material, a market in which our enemies are already attempting to overtake our current global lead.