IBM to invest $1.5 billion in chip development

The money will be split between three projects related to chip nanotechnologies, IBM said. They are updating its manufacturing plant in East Fishkill, New York; expanding its operations at the University of Albany's College of Nanoscale Science and Engineering, a creating a new center for research into chip packaging at a location to be determined in Upstate New York. IBM didn't say how much money was going to each.

For its part, New York State is giving IBM $140 million in development grants in return for its business. The state said it expects IBM's investments to generate 1,000 new high-tech jobs in Upstate New York.

IBM researchers are trying to accelerate the miniaturization of chip circuitry by researching at the atomic level for 32 nm and 22 nm semiconductors. Making chip circuits smaller allows computers to deliver performance gains without burning up more electrical power.

"These new investments will spur continuing advancements in nanotechnology and semiconductor research and development -- including new efforts in semiconductor packaging," said John Kelly, IBM senior vice president and director of research.

Chip makers such as Intel and Advanced Micro Devices are also constantly upgrading their manufacturing technologies to shrink chips. Intel switched its manufacturing process to 45 nm chips last year, and AMD is scheduled to make a similar move later this year. Intel hopes to shrink the features on its chips to 22 nm by 2011.

A nanometer is equal to about one billionth of a meter. In chip manufacturing, the figure refers to the smallest features etched onto the surface of chips. As chip makers build smaller and smaller transistors, they are dealing with features that are in some cases just a few atoms thick.

As part of its research efforts IBM is developing silicon nanophotonics, which could replace some wires on a chip with pulses of light on tiny optical fibers, for transferring data between the cores on a chip at lightening speed and using little power. It is also working with universities to develop carbon nanotubes, tinier transistors that could deliver better performance.