Conducting business: UK chip industry needs to pick its battle, says top boss
A top chip boss has urged the government’s new Semiconductor Advisory Panel (SAP) to narrow its focus so the UK can grab a stronghold in the escalating chip wars and protect its successful growth firms from rival markets.
Dr Simon Thomas, the chief executive of Cambridgeshire graphene-based semiconductor firm Paragraf, welcomed the government’s recent appointment of members to the SAP, which aims to revive the UK’s long-neglected but crucial microchip industry.
However, he told City PM the missing piece is for the SAP to “finally make a decision as to what it is the country wants to get behind”.
Since the government’s Semiconductor Strategy was published in May, “there has been a lot more talk around where should we be focusing in the UK in terms of trying to get the semiconductor ecosystem to a state that is suitable for the UK,” said Thomas.
“I say that very carefully because suitable doesn’t necessarily mean the same as what is going on in America or Europe,” he added.
While the UK is “never going to be a silicon industry” due to a lack of cash, talent and resources, Thomas suggested the SAP could focus on finding a niche for the UK such as chip designs, new technologies, or new materials, as opposed to the traditional silicon.
Some ideas were outlined in the Semiconductor Strategy but they were “hugely broad” and “we have to place our bets”, he said.
As tensions rise in the Taiwan Strait, and pressure builds towards a global chip emergency, the UK would do well to have something to trade with other nations, Thomas argued.
“We need to have a seat at the table,” he said, especially after cutting ties with the European Union.
Adrian Toutoungi, a partner at law firm Taylor Wessing, also believes the UK is in a far weaker position thanks to Brexit.
“We’re no longer sitting at the table and benefitting from security of supply,” he said.
It hinges on the UK relying on strong allies, “but the pandemic showed us how quickly these ties can fall apart”, added Toutoungi, referencing the battles over access to life-saving vaccines.
While the UK is an “incubator” for innovation and tech companies, it lacks talent which was previously poached from the EU with ease, said Thomas, who has had his fair share of issues in this department.
In his view, another concern for SAP is ensuring the UK joins its fractured semiconductor industry together and has “the right infrastructure in place” to maintain an ecosystem which supports startups and growth companies.
Although Thomas has said many times he has not ruled out moving operations elsewhere, ultimately he wants to show it can be done in the UK.
“We shouldn’t underestimate the UK,” he said.