Samsung, SK Hynix to Supply Gear for OpenAI’s Stargate

Key Concepts:

• Domestic manufacturing of semiconductors
• High Bandwidth Memory (HBM) production
• Trade deal between the U.S. and South Korea
• F-1 student visa program
• H-1B visa program
• Semiconductor industry workforce gap
• U.S. competitiveness in the semiconductor industry

Samsung and Open AI/Stargate Contracts

• The discussion begins with Asian players, specifically Samsung, winning contracts with OpenAI and Stargate.
• This is happening as the U.S. government is pushing for more domestic manufacturing.

Broader Context and Trump Administration Goals

• The Trump administration aimed to propel investment in Stargate and OpenAI's big data center project.
• The price tag of these investments and their support for the trade deal with South Korea were questioned.
• The trade deal calls for approximately $350 billion in South Korean investment in the U.S. over several years.

High Bandwidth Memory (HBM) Production Location

• A key question is where the high bandwidth memory (HBM) will be produced.
• The U.S. government wants to ensure more chip production happens domestically.
• There may be pressure on Samsung and the South Korean government to shift some HBM production to the U.S.

Visa Rule Changes and the Chip Industry

• The Trump administration's proposed changes to visa rules are being opposed by the chip industry.
• This creates a tension between the push for domestic manufacturing and the availability of a skilled workforce.

Workforce Challenges and the F-1 Visa

• The semiconductor industry faces a significant workforce gap, estimated at 67,000 jobs, according to semiconductor makers.
• Chip makers are pushing back against the administration's plan to crack down on the F-1 student visa.
• The F-1 visa is a key pipeline for talent in the tech industry.
• Currently, students can stay in the U.S. indefinitely as long as they are actively in a course of study.
• The administration wants to shorten this period to four years.

Industry Concerns and Competitiveness

• The industry argues that a less friendly approach to immigration will drive talent to other countries.
• This will hurt the competitiveness of the U.S. semiconductor industry.
• One unnamed semiconductor company CEO expressed deep concern that the visa changes will harm competitiveness.

H-1B Visa Fee Increase

• The administration is also raising the fee for H-1B visas to $100,000 for new applications.
• This could cost chip companies hundreds of millions of dollars in additional fees to secure the talent needed to meet job demands.

Conclusion

The U.S. government's push for domestic semiconductor manufacturing is facing challenges related to workforce availability and immigration policies. Proposed changes to F-1 and H-1B visa programs are raising concerns within the chip industry, which fears a loss of talent and reduced competitiveness. The location of high bandwidth memory (HBM) production remains a key point of negotiation, with the U.S. seeking to bring more of this production onshore.