Samsung commits $230B for five new chip plants in South Korea

Samsung Electronics said today that it plans to invest approximately $230 billion (300 trillion won) to build five new memory and foundry fabs in South Korea — a big move in line with the government’s ambitious aim to set up a mega semiconductor hub in Yongin, on the outskirts of Seoul. The investments will be made through 2042. 

The country’s move indicates that it is shoring up the domestic semiconductor production line to secure the supply chain as other countries, including the U.S., Taiwan, Japan, and China, are scrambling to ramp up their domestic chip manufacturing to offset risks to global supply chain disruption due to rising tensions between the U.S. and China. 

“It is expected that we would invest about 300 trillion KRW ($230 billion) in the chip-making cluster through 2042,” a spokesperson at Samsung said in an emailed statement to TechCrunch. Although the government, in a statement, spoke of plans for five plants, the Samsung spokesperson declined to comment on the number of plants Samsung will set up in the semiconductor cluster as well as other details. 

South Korea’s Ministry of Trade, Industry and Energy (MOTIE) unveiled Wednesday its new project to invest $422 billion (500 trillion won) by 2026 to promote six core technologies: semiconductors, electric vehicle batteries, autonomous vehicles, robots and displays. The government said it would earmark $260 billion (340 trillion won) specifically for the chip space to develop system semiconductors by 2026, considering “semiconductors as strategic economic support and national security assets.” 

The mega semiconductor hub also will have a whole value chain of chip-making processes from memory, foundry, and design houses to material suppliers and attract 150 domestic and global fabless companies and advanced chip materials and equipment makers, per the announcement by the country’s trade ministry. The South Korean government wants to foster high-tech industries by working with corporations and intends to offer expanded tax breaks for companies in the advanced tech space, the statement says. 

South Korea is not the only country to be making big moves to build out its own manufacturing operations.

Japan has been partnering with global semiconductor and chip equipment makers to revive its own semiconductor industry. The world’s largest contract chip producer, Taiwan Semiconductor Company (TSMC), also has been expanding its manufacturing footprint both domestically and overseas in the U.S. and Japan.

Samsung already operates a foundry chip facility in Austin, Texas, and it has recently announced additional investment plans for the U.S.: $17 billion earmarked to build a manufacturing facility in Taylor, Texas. In addition, it is also considering investing $200 billion to set up a further 11 chip plants in Texas.  

Separately, Korea’s Ministry of Science and ICT announced last month to boost its AI chip industry with $642.5 million.

Samsung commits $230B for five new chip plants in South Korea by Kate Park originally published on TechCrunch

How China is building a parallel generative AI universe

The gigantic technological leap that machine learning models have shown in the last few months is getting everyone excited about the future of AI — but also nervous about its uncomfortable consequences. After text-to-image tools from Stability AI and OpenAI became the talk of the town, ChatGPT’s ability to hold intelligent conversations is the new obsession in sectors across the board.

In China, where the tech community has always watched progress in the West closely, entrepreneurs, researchers, and investors are looking for ways to make their dent in the generative AI space. Tech firms are devising tools built on open source models to attract consumer and enterprise customers. Individuals are cashing in on AI-generated content. Regulators have responded quickly to define how text, image, and video synthesis should be used. Meanwhile, U.S. tech sanctions are raising concerns about China’s ability to keep up with AI advancement.

As generative AI takes the world by storm towards the end of 2022, let’s take a look at how this explosive technology is shaking out in China.

Chinese flavors

Thanks to viral art creation platforms like Stable Diffusion and DALL-E 2, generative AI is suddenly on everyone’s lips. Halfway across the world, Chinese tech giants have also captivated the public with their equivalent products, adding a twist to suit the country’s tastes and political climate.

Baidu, which made its name in search engines and has in recent years been stepping up its game in autonomous driving, operates ERNIE-ViLG, a 10-billion parameter model trained on a data set of 145 million Chinese image-text pairs. How does it fair against its American counterpart? Below are the results from the prompt “kids eating shumai in New York Chinatown” given to Stable Diffusion, versus the same prompt in Chinese (纽约唐人街小孩吃烧卖) for ERNIE-ViLG.

Stable Diffusion


As someone who grew up eating dim sum in China and Chinatowns, I’d say the results are a tie. Neither got the right shumai, which, in the dim sum context, is a type of succulent, shrimp and pork dumpling in a half-open yellow wrapping. While Stable Diffusion nails the atmosphere of a Chinatown dim sum eatery, its shumai is off (but I see where the machine is going). And while ERNIE-ViLG does generate a type of shumai, it’s a variety more commonly seen in eastern China rather than the Cantonese version.

The quick test reflects the difficulty in capturing cultural nuances when the data sets used are inherently biased — assuming Stable Diffusion would have more data on the Chinese diaspora and ERNIE-ViLG probably is trained on a greater variety of shumai images that are rarer outside China.

Another Chinese tool that has made noise is Tencent’s Different Dimension Me, which can turn photos of people into anime characters. The AI generator exhibits its own bias. Intended for Chinese users, it took off unexpectedly in other anime-loving regions like South America. But users soon realized the platform failed to identify black and plus-size individuals, groups that are noticeably missing in Japanese anime, leading to offensive AI-generated results.

Aside from ERNIE-ViLG, another large-scale Chinese text-to-image model is Taiyi, a brainchild of IDEA, a research lab led by renowned computer scientist Harry Shum, who co-founded Microsoft’s largest research branch outside the U.S., Microsoft Research Asia. The open source AI model is trained on 20 million filtered Chinese image-text pairs and has one billion parameters.

Unlike Baidu and other profit-driven tech firms, IDEA is one of a handful of institutions backed by local governments in recent years to work on cutting-edge technologies. That means the center probably enjoys more research freedom without the pressure to drive commercial success. Based in the tech hub of Shenzhen and supported by one of China’s wealthiest cities, it’s an up-and-coming outfit worth watching.

Rules of AI

China’s generative AI tools aren’t just characterized by the domestic data they learn from; they are also shaped by local laws. As MIT Technology Review pointed out, Baidu’s text-to-image model filters out politically sensitive keywords. That’s expected, given censorship has long been a universal practice on the Chinese internet.

What’s more significant to the future of the fledgling field is the new set of regulatory measures targeting what the government dubs “deep synthesis tech”, which denotes “technology that uses deep learning, virtual reality, and other synthesis algorithms to generate text, images, audio, video, and virtual scenes.”As with other types of internet services in China, from games to social media, users are asked to verify their names before using generative AI apps. The fact that prompts can be traced to one’s real identity inevitably has a restrictive impact on user behavior.

But on the bright side, these rules could lead to more responsible use of generative AI, which is already being abused elsewhere to churn out NSFW and sexist content. The Chinese regulation, for example, explicitly bans people from generating and spreading AI-created fake news. How that will be implemented, though, lies with the service providers.

“It’s interesting that China is at the forefront of trying to regulate [generative AI] as a country,” said Yoav Shoham, founder of AI21 Labs, an Israel-based OpenAI rival, in an interview. “There are various companies that are putting limits to AI… Every country I know of has efforts to regulate AI or to somehow make sure that the legal system, or the social system, is keeping up with the technology, specifically about regulating the automatic generation of content.”

But there’s no consensus as to how the fast-changing field should be governed, yet. “I think it’s an area we’re all learning together,” Shoham admitted. “It has to be a collaborative effort. It has to involve technologists who actually understand the technology and what it does and what it doesn’t do, the public sector, social scientists, and people who are impacted by the technology as well as the government, including the sort of commercial and legal aspect of the regulation.”

Monetizing AI

As artists fret over being replaced by powerful AI, many in China are leveraging machine learning algorithms to make money in a plethora of ways. They aren’t from the most tech-savvy crowd. Rather, they are opportunists or stay-home mums looking for an extra source of income. They realize that by improving their prompts, they can trick AI into making creative emojis or stunning wallpapers, which they can post on social media to drive ad revenues or directly charge for downloads. The really skilled ones are also selling their prompts to others who want to join the money-making game — or even train them for a fee.

Others in China are using AI in their formal jobs like the rest of the world. Light fiction writers, for instance, can cheaply churn out illustrations for their works, a genre that is shorter than novels and often features illustrations. An intriguing use case that can potentially disrupt realms of manufacturing is using AI to design T-shirts, press-on nails, and prints for other consumer goods. By generating large batches of prototypes quickly, manufacturers save on design costs and shorten their production cycle.

It’s too early to know how differently generative AI is developing in China and the West. But entrepreneurs have made decisions based on their early observation. A few founders told me that businesses and professionals are generally happy to pay for AI because they see a direct return on investment, so startups are eager to carve out industry use cases. One clever application came from Sequoia China-backed Surreal (later renamed to Movio) and Hillhouse-backed, which discovered during the pandemic that e-commerce sellers were struggling to find foreign models as China kept its borders shut. The solution? The two companies worked on algorithms that generated fashion models of all shapes, colors, and races.

But some entrepreneurs don’t believe their AI-powered SaaS will see the type of skyrocketing valuation and meteoric growth their Western counterparts, like Jasper and Stability AI, are enjoying. Over the years, numerous Chinese startups have told me they have the same concern: China’s enterprise customers are generally less willing to pay for SaaS than those in developed economies, which is why many of them start expanding overseas.

Competition in China’s SaaS space is also dog-eat-dog. “In the U.S., you can do fairly well by building product-led software, which doesn’t rely on human services to acquire or retain users. But in China, even if you have a great product, your rival could steal your source code overnight and hire dozens of customer support staff, which don’t cost that much, to outrace you,” said a founder of a Chinese generative AI startup, requesting anonymity.

Shi Yi, founder and CEO of sales intelligence startup FlashCloud, agreed that Chinese companies often prioritize short-term returns over long-term innovation. “In regard to talent development, Chinese tech firms tend to be more focused on getting skilled at applications and generating quick money,” he said. One Shanghai-based investor, who declined to be named, said he was “a bit disappointed that major breakthroughs in generative AI this year are all happening outside China.”

Roadblocks ahead

Even when Chinese tech firms want to invest in training large neural networks, they might lack the best tools. In September, the U.S. government slapped China with export controls on high-end AI chips. While many Chinese AI startups are focused on the application front and don’t need high-performance semiconductors that handle seas of data, for those doing basic research, using less powerful chips means computing will take longer and cost more, said an enterprise software investor at a top Chinese VC firm, requesting anonymity. The good news is, he argued, such sanctions are pushing China to invest in advanced technologies over the long run.

As a company that bills itself as a leader in China’s AI field, Baidu believes the impact of U.S. chip sanction on its AI business is “limited” both in the short and longer term, said the firm’s executive vice president and head of AI Cloud Group, Dou Shen, on its Q3 earnings call. That’s because “a large portion” of Baidu’s AI cloud business “does not rely too much on the highly advanced chips.” And in cases where it does need high-end chips, it has “already stocked enough in hand, actually, to support our business in the near term.”

What about the future? “When we look at it at a mid- to a longer-term, we actually have our own developed AI chip, so named Kunlun,” the executive said confidently. “By using our Kunlun chips [Inaudible] in large language models, the efficiency to perform text and image recognition tasks on our AI platform has been improved by 40% and the total cost has been reduced by 20% to 30%.”

Time will tell if Kunlun and other indigenous AI chips will give China an edge in the generative AI race.

How China is building a parallel generative AI universe by Rita Liao originally published on TechCrunch

TSMC to produce 3-nanometer chips at its Arizona factory

TSMC founder Morris Chang said today that the semiconductor giant and Apple supplier will build 3-nanometer chips at its factory in Arizona, though final plans are not ready yet. The factory is currently under construction, with plans to begin production in 2024.

During a press conference in Taipei, Chang said “three-nanometer, TSMC right now has a plan, but it has not been completely finalized,” Reuters reports. “It has almost been finalized—in the same Arizona site, phase two. Five-nanometer is phase one, 3-nanometer is phase two.”

On its website, TSMC says its 3-nanometer tech, called N3, will be a full node stride from its 5-nanometer technology, and offer up to 70% logic density gain, up to 15% speed improvement at the same power and up to 30% power reduction at the same speed when compared to its predecessor. It is targeting volume technology in the second half of this year.

The world’s largest foundry, TSMC makes almost half of the world’s most advanced chips. The dominance of Taiwan’s semiconductor companies (TSMC’s peers include Foxconn) is one of its major advantages against China, which considers Taiwan a province, but as worldwide chip shortages stymie the production of electronics, it also calls into question the supply chain’s reliance.

TSMC’s Arizona factory, along with a second one that is reportedly in planning stages, are part of the Biden administration’s strategy to bolster U.S. chipmaking. TSMC is also building a factory in Japan and is in talks with the German government to build another one in that country.

Other foundries working on 3-nanometer chips include Samsung Electronics, which started producing 3-nanometer chips in June, ahead of TSMC. The South Korean tech giant is producing 3-nanometer chips at its Hwaseong and Pyeongtaek semiconductor facilities. Samsung said last year it would invest 171 trillion KRW ($132 billion) in its logic chip and foundry business by 2030, and it is also building a semiconductor plant in Texas.

TSMC to produce 3-nanometer chips at its Arizona factory by Catherine Shu originally published on TechCrunch

Eliyan raises $40M from Intel and Micron to build chiplet interconnects

Increasingly, as Moore’s law rears its ugly head, computer chip developers are adopting “chiplet” architectures to scale their hardware’s processing power. Chiplets are Lego-like integrated circuit blocks designed to work with other, similar chiplets to form complex, stackable chips that boost performance while maintaining a similar physical footprint. Chiplets offer a number of advantages over conventional designs. But assembly issues — as well as challenges in balancing cost, performance, power consumption and time to market — often plague them in the early phases.

Aiming to overcome the hurdles in chiplet creation, Ramin Fajadrad, Syrus Ziai and Patrick Soheili founded Eliyan, a chiplet interconnect startup, in 2021. Eliyan’s technology — dubbed NuLink — connects chiplet components using standard chip packaging, leading to what the company claims are faster-performing and more energy-efficient chips.

“The focus is on developing a way to enable a more high-performance, lower-power and lower-latency interconnect for chiplet architectures, which experts agree is the only path to continuing to scale Moore’s law,” Farjadrad told TechCrunch in an email interview. “We use our technology in standard packaging, thus saving time, cost and development effort compared to more advanced packing that other interconnect schemes require. In addition, our approach has sustainability benefits by reducing material costs and waste in the manufacturing process and lowering energy consumption for high-performance compute chips.”

Eliyan’s roots are in a previous startup, Aquantia, that Marvell acquired in 2019. Farjadrad says the technology has been under development since 2017; he co-started Aquantia and served as the startup’s chief engineer for nearly 15 years. Prior to co-founding Eliyan, Farjadrad spent several years at Marvell as CTO and VP of the company’s networking and automotive division. Ziai is a former Qualcomm engineering VP, while Soheili was previously VP of business development at semiconductor firm eSilicon.

While Eliyan hasn’t launched its technology commercially yet — it expects the first silicon to hit the market in Q2 2023 — the company claims to have achieved the last step before manufacturing, a tape-out, using semiconductor manufacturer TSMC’s 5 nm process. “Process” in chip lingo refers to an architectural platform; TSMC began mass-producing 5 nm chips in 2020.

“Eliyan’s technology enables processors by allowing them to scale in performance and power to be more readily and practically manufacturable,” Farjadrad said. “The world will always need more computing power, and Eliyan is enabling a critical aspect of making sure scaling will happen for any type of high-performance computing application.”

The fact that Eliyan’s tech has yet to reach market might give some would-be customers pause. But the startup has notable investors in the chip world behind it, including Intel and Micron, who alongside Cerberus and Celestra contributed to Eliyan’s $40 million Series A tranche that closed today.

With the capital, Eliyan plans to continue chasing after a chiplet market that could be worth $50 billion in 2024 — specifically by ramping up testing and implementation. Farjadrad wouldn’t name clients, but said that Eliyan, which currently has a 21-person staff, is in discussions with “big semi companies, hyperscalers and AI processor startups.”

“We’re dealing with the challenges and realities of physics in designing and manufacturing advanced chips … [but we’re] in a high-demand market,” Farjadrad said. “Our technology will ultimately lead to faster, more efficient and cheaper high-performance computing to run data centers, cloud computing AI, graphics and more.” 

Eliyan raises $40M from Intel and Micron to build chiplet interconnects by Kyle Wiggers originally published on TechCrunch

Nvidia touts a slower chip for China to avoid US ban

Two months after the U.S. choke off China’s access to two of Nvidia’s high-end microchips, the American semiconductor design giant unveiled a substitute with a reduced processing speed for its second-largest market.

The Nvidia A800 graphic processing unit is “another alternative product to the Nvidia A100 GPU for customers in China,” a spokesperson for Nvidia said in a statement to TechCrunch. “The A800 meets the U.S. government’s clear test for reduced export control and cannot be programmed to exceed it.” The new chip was first reported by Reuters on Monday.

The A100 processor is known for powering supercomputers, artificial intelligence, and high-performing data centers for industries ranging from biotech and finance to manufacturing. Alibaba’s cloud computing business has been one of its customers. A100, along with Nvidia’s enterprise AI chip H100, were placed under a U.S. export control list to “address the risk that the covered products may be used in, or diverted to, a ‘military end use’ or ‘military end user’ in China and Russia.”

Nvidia previously reported that the U.S. ban could affect as much as $400 million in potential sales to China in the third quarter, so the new chip seems to be an attempt to remedy the financial loss. The A800 GPU went into production in Q3, according to Nvidia’s spokesperson.

Indeed, chip distributors in China, such as Omnisky, are already marketing A800 in their product catalogs. The chip looks to be designed to circumvent U.S. export rules while still carrying out other core computing capabilities. Most of the key specs of A100 and A800 are identical except for their interconnect speeds: A800 runs at 400 gigabytes per second while A100 functions at 600 gigabytes per second, which is the performance threshold set by the U.S. ban.

According to an analysis from the Center for Strategic and International Studies, a bipartisan think tank, “By only targeting chips with very high interconnect speeds, the White House is attempting to limit the controls to chips that are designed to be networked together in the data centers or supercomputing facilities that train and run large AI models.”

Nvidia isn’t the only one slowing down its chips in order to evade U.S. sanctions. Alibaba and Chinese chip design startup Biren, which have been pouring resources into making rivals of Nvidia processors, are modifying the performance of their latest semiconductors, according to the Financial Times. That’s because Alibaba and Biren, like other fabless semiconductor firms, contract Taiwan’s TSMC to make their products. And because U.S. export controls cover chip sales by companies using American technologies, sales from TSMC fabs to China could be curtailed.

Nvidia touts a slower chip for China to avoid US ban by Rita Liao originally published on TechCrunch

Volkswagen to plough €2.4B into vehicle automation in China and form JV with Horizon Robotics

Volkswagen is accelerating the pace to automate its electric vehicles for Chinese customers. CARIAD, a wholly-owned automotive software company of the German auto behemoth, intends to set up a joint venture with Horizon Robotics, one of China’s most serious auto chip developers, the company said on Thursday.

The German automaker plans to deploy around €2.4 billion to its cooperation with Horizon Robotics, a transaction that’s expected to be completed by 2023 and is subject to regulatory approval. Following the deal, CARIAD will hold a majority stake of 60% in the JV. It wasn’t until 2020 that China moved to ease the rules that had previously barred foreign companies from owning majority stakes in local auto firms.

The tie-up comes at a time of global chip shortage and surging semiconductor costs. A handful of automakers are already moving some of their chip production in-house to counter supply chain uncertainties. China’s electric vehicle upstarts Xpeng and Nio have both assembled sizable teams to develop auto-grade chips, according to Chinese tech business publication LatePost.

The deal came just weeks after Horizon announced it had received a strategic investment from China’s state-owned automaker Chery Automobile.

Together with Horizon Robotics, Volkswagen will be working on full-stack advanced driver assistance systems and autonomous driving solutions for the Chinese market. The goal is to “drive forward the integration of numerous functions on one chip, increasing the stability of the system, saving costs, and reducing energy consumption.”

The vision is reminiscent of Nvidia’s recently announced next-generation auto-grade chip that’s designed to unify autonomous driving and in-car technologies. It’s interesting to see Volkswagen forming close ties with a Chinese startup, while Nvidia’s state-of-the-art auto chip is widely recognized as the most cutting-edge in the industry. Given the escalation of U.S. chip limits on China, it won’t be surprising that supply chain diversification is on the mind of VW executives. The question is whether Horizon can deliver something that’s up to par with its American counterpart.

In any case, having an on-the-ground partner will likely help VW create more customized solutions for the world’s largest auto market. As Ralf Brandstätter, member of the management board of Volkswagen AG for China, remarks in a statement:

“Localized technology development grants the region more autonomy to further expand its position in the dynamic automotive market. Cutting-edge technology comprising the full software and hardware stack, which the new joint venture will develop, will enable us to tailor our products and services even faster and more consistently to the needs of our Chinese customers. Teaming up with Horizon Robotics will allow Volkswagen to accelerate the development of automated driving solutions as part of our NEW AUTO strategy and drive the repositioning of our China business.”

Volkswagen to plough €2.4B into vehicle automation in China and form JV with Horizon Robotics by Rita Liao originally published on TechCrunch

Europe wants to shape the future of virtual worlds with rules and taxes

EU lawmakers are moving in on the metaverse and making it plain that, whatever newfangled virtual world/s and/or immersive social connectivity that tech industry hype involving the term may refer to, these next-gen virtual spaces won’t escape one hard reality: Regulation.

There may be a second metaverse certainty too, if the Commission gets its way: Network infrastructure taxes.

The EU’s internal market commissioner, Thierry Breton, said today it believes some of the profits made in an increasingly immersive software realm should flow to providers of the network backbone required to host these virtual spaces — a suggestion that’s sure to trigger a fresh round of net neutrality pearl-clutching.

The Commission has been signalling for some months that it wants to find a way to support mobile operators to expand rollouts of next-gen cellular technologies — via imposing some kind of a levy on US tech giants to help fund European network infrastructure — following heavy lobbying by local telcos.

Last week, Breton revealed it plans to consult on network infrastructure cost contribution ideas in Q1 next year — as part of a wider metaverse-focused initiative, with the latter proposal coming later in the year.

More details of the bloc’s thinking on fostering development of virtual spaces and the network pipes needed to connect them has emerged today.

EU initiative on virtual worlds

In a Letter of Intent published today, setting out the bloc’s policy priorities for 2023 — and accompanying her annual State of the European Union speech — the EU’s president, Ursula von der Leyen, confirmed the Commission will put forward an “Initiative on virtual worlds, such as metaverse” next year.

The letter offers scant details on what exactly will be inside the EU’s virtual worlds package. But Breton — via a blog post on LinkedIn of all places — has picked up the baton to flesh out his views on how to deal, in broad-brush policy terms, with (the) metaverse(s) — something he couches as “one of the pressing digital challenges ahead of us”.

Breton presents his remarks as “Europe’s plan to thrive in the metaverse”. Though it remains to be (officially) confirmed whether he’s flying a little solo here — or playing advanced messenger on the direction of next year’s initiative. (We asked the Commission for more on the forthcoming virtual worlds initiative but with so much EU action today our contact warned there could be a delayed response — before pointing back to Breton’s blog, suggesting he is indeed signposting where the bloc is headed on virtual worlds.)

First up, both Breton (at length) and von der Leyen (in passing) are clear in planting a regulatory stake in virtual ground — by pointing out that would-be metaverse monopolists will have to contend with existing EU rules, such as the recent major EU digital rule reboot.

Rebooted digital rules

In her letter penned in difficult geopolitical and economic times, von der Leyen urges the bloc to stay the course on the green and digital transitions — which formed a key plank of her policy plan when she took up her mandate at the end of 2019. “This is about building a better future for the next generation and making ourselves more resilient and more prepared for challenges to come,” she writes, encouraging EU institutions to stick with the transformative push for sustainability and digitalization and implement key pieces of the plan already agreed on.

“This includes implementing the landmark agreements on the Digital Markets Act (DMA) and the Digital Services Act (DSA) which saw the EU take global leadership in regulating the digital space to make it safer and more open,” she goes on, name checking two big components of the digital reboot agreed by the EU’s institutions earlier this year — before adding a further nod to what else may be coming: “We will continue looking at new digital opportunities and trends, such as the metaverse.”

In his blog post, Breton makes it even more plain that metaverse builders are already subject to EU rules. “With the DSA and DMA, Europe has now strong and future-proof regulatory tools for the digital space,” he writes, pointedly adding: “We have also learned a lesson from this work: We will not witness a new Wild West or new private monopolies.

“We intend to shape from the outset the development of truly safe and thriving metaverses.”

This conviction was doubtless cemented by Facebook’s corporate pivot last year to Meta — a self-declared “metaverse company” — as the tech giant sought to escape years of operational scandals and reputational toxicity stuck like a barnacle to its social media brand by deploying a crisis PR rebranding tactic that implies a pivot, without it having to make meaningful reform to its business or business model.

While no one can say for sure whether the metaverse will ever exist (or merely remain an amorphous marketing label), should anything of substance actually materialize it’s pretty clear it won’t be located that far away from the kind of social connectivity Meta already monetizes through mass surveillance-based profiling and behavioural ads. So it seems a safe bet Zuckerberg is hoping to bankroll Facebook’s ‘metaverse’ future via plenty of user-profiling and behavioral ads too, at least in large part.

But if the Facebook founder was betting on a little corporate rebranding exercise to get Meta ahead of pesky regulators — such as privacy watchdogs in Europe that are finally starting to land some sizeable lumps on the company — he may be disappointed to find virtual worlds aren’t an escapist paradise after all.

Out with the old growth playbook

Taken as a whole, Breton’s remarks suggest the EU will be coming with a blended ‘sow and scythe’ package for virtual worlds — offering support initiatives (to encourage development and infrastructure) but also warnings that it will step in actively to steer and shape development, to ensure any new wave of ever-more-immersive socio-digital spaces don’t just repeat the same toxic growth playbook as Facebook.

Key EU preoccupations here appear to be enforcing user-centric safety issues (such as in areas like content moderation); and ensuring platforms remain open and contestable to the whole market (via mandating interoperability standards).

“Our European way to foster the virtual worlds is threefold: People, technologies and infrastructure,” Breton writes, summarizing the planned approach. “This new virtual environment must embed European values from the outset. People should feel as safe in the virtual worlds as they do in the real one.

“Private metaverses should develop based on interoperable standards and no single private player should hold the key to the public square or set its terms and conditions. Innovators and technologies should be allowed to thrive unhindered.”

There is also a reference to launching a “creative and interdisciplinary movement” — with the goal of developing “standards, increas[ing] interoperability, maximising impact” — a movement Breton says he wants to involve IT experts, regulatory experts citizens’ organisations and youth, in a similar fashion to the new European Bauhaus initiative the EU has applied to encourage engagement with sustainability-focused ‘green deal’ goals.

This piece of the EU plan contrasts to the more single-minded focus of Meta president (and former EU lawmaker), Nick Clegg, who — in his role evangelizing metaverse for Meta — has spent a lot of words talking up the volume of developer jobs that will be needed to build the immersive future Meta is betting its corporate continuity on.

Breton’s point appears to be that the EU wants a far more diverse mix of expertise to be involved in any ‘metaverse’ development. (Or, tl;dr: ‘We all know what happens when tech worlds are built, owned and operated by too many techbros — and we sure don’t want a repeat of that!’)

Ecosystem support — and infrastructure taxes?

A second big chunk of Breton’s blog post focuses on the technologies and tech skills the Commission sees as necessary for the bloc to have the power to bend virtual world makers to “European values”.

Breton notes these span many areas — of “software, platforms, middleware, 5G, HPC, clouds, etc” — but with “immersive technologies and virtual reality” identified as being “at the heart” of the metaverse “phenomenon”. So immersive tech looks to be where the EU will direct the meatiest ecosystem support in the forthcoming virtual worlds package.

But for starters Breton has announced the launch of a VR and AR industry coalition.

“The Commission has been laying the groundwork to structure this ecosystem,” he writes. “Today, I am happy to launch the Virtual and Augmented Reality Industrial Coalition, bringing together stakeholders from key metaverse technologies. We have developed a roadmap endorsed by over 40 EU organisations active in this space, from large organisations to SMEs, and universities.”

He also gives a nod to the European Chips Act — which aims to mobilize public and private investment to drive on-shore semiconductor manufacture in a supply chain resilience and digital sovereignty drive — with the commissioner recognizing that hardware development and production is a core component for virtual worlds, underpinning its development (and, ultimately, most likely, determining whether or not immersive technologies like VR and AR remain a niche (sometimes) nausea-inducing pass-time for the geeky few or actually make the leap into a transformative mainstream medium).

“The next step will be a quantum leap from current virtual reality and other enabling technologies to a world that truly blends the real with the virtual,” pens Breton, a former telco exec, in full tech evangelist mode.

The EU commissioner saves the most controversial piece of the upcoming metaverse plan for last: A plan for infrastructure taxes to come down the policy pipe. And he confines himself to trying to tamp down any objections by laying out a case for some form of levy to fund the necessary connectivity — aka the high capacity, high bandwidth, high speed, low latency networks we’re told will be needed to sustain these hyper immersive virtual spaces we’re also told we’ll want to pause our off-line existence to spend time in.

There are no firm details on what the EU is proposing on virtual world taxes as yet — just an affirmation that a consultation is coming down the pipe.

“The current situation, exacerbated during the Covid pandemic, shows a paradox of increasing volumes of data being carried on the infrastructures but decreasing revenues and appetite to invest to strengthen them and make them resilient,” writes Breton, drawing on long-standing telco gripes about scale of network investment demanded to roll out techs like 5G vs dwindling returns.

“The current economic climate sees stagnating rewards for investment and increasing deployment costs for pure connectivity infrastructure,” he goes on. “In Europe, all market players benefiting from the digital transformation should make a fair and proportionate contribution to public goods, services and infrastructures, for the benefit of all Europeans.”

Case made, Breton ends by trailing what he couches as a “comprehensive reflection and consultation on the vision and business model of the infrastructure that we need to carry the volumes of data and the instant and continuous interactions which will happen in the metaverses” — thereby landing a second blow of his case-hammer backing metaverse infrastructure taxes.

Still, you have to admire the EU’s repurposing of the tech industry’s latest shiny new hype vehicle to truck back the other way and deliver an age-old demand for a revenue share.


Europe wants to shape the future of virtual worlds with rules and taxes by Natasha Lomas originally published on TechCrunch

Liquid Instruments hooks up with $28.5M to upend the engineering testing market with software-defined instrumentation

Engineering innovations are a critical cornerstone in the evolution of technology, but ironically there haven’t been as many innovations in engineers’ tooling itself. Now, a startup called Liquid Instruments that’s devised a set of software and hardware to help engineers carry out one aspect of their work — testing — more efficiently is announcing a capital injection of $28.5 million to fuel its growth. It’s been on a roll with sales up 4x this year, with customers of its devices including NASA (where the founders first worked on the concept), Google and Qualcomm, Stanford and Duke, and the U.S.’s National Institute of Standards and Technology.

Moore’s Law is alive and well here: the startup’s unique selling point is that it has built a new take on testing equipment by translating much of the process into software that sits on hardware that’s faster, many times smaller, and less costly than traditional testing equipment, and provides other kinds of flexibility, such as more dynamic visualizations, diagnostics, programability and the ability to work on the tests in the cloud.

This Series B round of equity funding, which I understand values the company at north of $100 million, will help Liquid Instruments continue to build out more hardware models, and to write more software-based more testing tools for those devices.

The company — founded originally in Australia and now officially headquartered in San Francisco — today sells three versions of its Moku hardware — the Go, the Lab and the Pro, respectively starting at $599, $3,500 and $12,000. They are part of a bigger area of software-defined test instrumentation, and Daniel Shaddock, the CEO and co-founder, first worked on a version of this tech when he was on a team building testing equipment in NASA’s Jet Propulsion Laboratory for high precision wave detection using a similar software-defined approach.

After that project was done, Shaddock said he and some 11 others would have been “scattered to the wind”, working at other space agencies or academia, so he suggested that maybe they continue working together, to see how a similar concept could be applied to building testing equipment for the engineering world and academics at large. “It was great measurement technology,” he said, “so we thought, maybe others might like it, too.”

The devices use standard input ports and are based on flexible FPGA chip architecture. Today those chips are Xilinx chips from AMD, but the company is open to using “whatever the chip du jour might be” said Shaddock. That’s because its IP is not about the chips but about how they’re used to work “at the crossroads of analogue circuitry and digital processing,” he said. “What has been done previously on analogue devices, and distributed across many chips, are now all on FPGA chips. Now that they are larger, we can slice up the chip into more functions, and have them all work together.”

Although this is bringing down the price of testing devices, it’s not exactly putting Liquid Instruments into the category electronics companies building tools for hobbyists. Its customers rather span research and education through to government labs and industrial businesses, with applications including aerospace, defense, semiconductor, LiDAR and quantum computing. And it’s finding a lot of traction in all of them, with sales up four-fold in the last year.

The investors in this round also are a testament to its traction. Led by Acorn Capital, it also includes strategics like Lockheed Martin Ventures and Powerhouse Ventures, as well as previous backers Spirit Super/ANU Connect Ventures, MA Growth Ventures, Significant Capital Ventures, and Boman Enterprises. Liquid Instruments has to date raised $50 million.

“Liquid Instruments is creating a versatile test and measurement platform that is customizable and efficient,” said Chris Moran, vice president and general manager of Lockheed Martin Ventures, in a statement. “This technology has the potential to deliver mission critical functionality that can provide value to our customer. We are excited by Liquid’s continued growth and look forward to strengthening our collaboration.”

“Liquid Instruments’ Australian-developed software-defined approach is the manifestation of an ambitious plan targeting a vital market that has suffered from a deficit of innovation and imagination.” added Robert Routley, CEO, Acorn Capital. “We see tremendous potential for their platform to continue to grow and evolve, benefitting more industries over time. Liquid Instruments is well positioned to execute on its expansion strategy and disrupt the test and measurement sector and lead the industry through the much-needed transition from hardware to software.”

“This injection of capital will supercharge our ability to revolutionize the test and measurement industry,” said Daniel Shaddock, CEO, and co-founder of Liquid Instruments. “Our innovative software-first approach provides clear advantages over traditional hardware-based solutions, and this funding strongly positions us to lead this critical industry transformation.”

Liquid Instruments’ Moku product line offers the world’s most powerful and flexible software-defined instrumentation platform, harnessing the processing power and reconfigurability of Field Programmable Gate Arrays (FPGAs) to combine multiple instruments into one compact and accessible device. These product offerings include the Moku:Go, a complete lab solution for engineers and students to actively test designs and projects, and the Moku:Pro, an integrated platform for the most demanding research and engineering applications.

“We are focused on enhancing cloud integration features for our products and scaling production of Moku:Go to help millions of undergraduate engineering students around the world unlock their full potential,” added Shaddock. “Moku’s will continue to receive new features via frequent over-the-air updates enabling new solutions in key commercial industries.”

Liquid Instruments hooks up with $28.5M to upend the engineering testing market with software-defined instrumentation by Ingrid Lunden originally published on TechCrunch

Nvidia the latest collateral damage in US-China tech war

Nvidia, the world’s largest maker of artificial intelligence chips, is at the heart of a new round of U.S. tech sanctions targeting China.

Nvidia noted in an SEC filing that the U.S. government had imposed new export restrictions on two of its most advanced AI chips to China, its second-largest market after Taiwan making up 26% of its revenues in 2021.

The ban could cost Nvidia as much as $400 million in potential sales to China in the third quarter, the firm said.

The export control also bars Nvidia from shipping the chips to Russia, though the company said it doesn’t currently sell to the country.

The U.S. government said the move “will address the risk that the covered products may be used in, or diverted to, a ‘military end use’ or ‘military end user’ in China and Russia.” But the ban is in practice crimping a wide array of businesses and organizations using the silicons beyond military uses.

The two chips in question are the Nvidia A100 and H100 graphic processing units. A100 is designed to provide high-performance computing, storage, and networking capabilities for industries spanning healthcare, finance, and manufacturing, explains Chinese e-commerce and cloud computing giant Alibaba, a user of A100.

H100 is the firm’s upcoming enterprise AI chip that is expected to ship by the end of this year and has part of its production done in China.

Nvidia’s engagement with China won’t be completely severed. The U.S. government has granted permission for Nvidia to keep manufacturing H100 in China, Nvidia said in another filing, though access by Chinese customers will still be restricted.

The ban is “sci-tech hegemony”, snapped China’s foreign ministry spokesperson Wang Wenbin in a regular press conference on Thursday. “The US seeks to use its technological prowess as an advantage to hobble and suppress the development of emerging markets and developing countries.”

The U.S.’s move to bar China’s access to its high-end technologies has in turn accelerated the latter’s pursuit of independence. Huawei has been doubling down on smartphone chip development ever since Washington put it on an export blacklist over national security concerns in 2019. A swathe of domestic semiconductor startups is netting hefty investments from VCs and government-guided funds.

While China may still be a generation behind in producing the most sophisticated chips, the country is gradually sharpening its edge in lower-end, specialized semiconductors, such as neural processing units that give phone cameras a boost. It remains to be seen what ripple effect the Nvidia ban will create.

Ford reopens order bank and raises prices for 2023 Mustang Mach-E

Ford began taking reservations for its 2023 Mustang Mach-E on Thursday after a four-month hiatus due to short supply.

The automaker also boosted the battery-electric SUV’s range and upped the price amid economic headwinds such as inflation and rising costs for battery materials. Ford closed the order bank for the 2022 model year last spring when a global semiconductor shortage stymied production.

The new pricing, which goes into effect Thursday, is “due to significant material cost increases, continued strain on key supply chains, and rapidly evolving market conditions, and will continue to monitor pricing across the model year,” the company said in a statement.

Pricing for new orders will start at $46,895 for the rear-wheel-drive base trim with standard range (about a 7% increase) and just below $70,000 for the top-of-the-line GT Extended Range edition.

The Mach-E SUV’s Premium models with the Extended Range battery will be able to travel 290 miles on a fully charged battery, 13 miles longer than the outgoing model.

Ford is also adding its Co-Pilot360 Driver Assist Technology as a standard safety feature. The software will enable customers to receive future over-the-air updates for its Advanced Driver Assistance Systems (ADAS), according to Marin Gjaja, chief customer officer for Ford’s Model e division.

The automaker, which aims to sell more than 2 million EVs annually by 2026, is investing tens of billions of dollars to boost its production capacity worldwide. Ford said Monday it plans to lay off about 3,000 salary and contract workers to manage costs.

“We are eliminating work, as well as reorganizing and simplifying functions throughout the business,” Executive Chairman Bill Ford and CEO Jim Farley wrote in a letter to employees.

Earlier this month, Ford raised the price of its F-150 Lightning battery-electric pickup truck with increases ranging between $6,000 to $8,500 depending on the trim. The 2023 Lightning will start at $46,974 and top out at nearly six figures.