Pentagon To Buy Advanced Microchips From Company Owned By Abu Dhabi


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Jonah Bennett Contributor
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The Pentagon is set to purchase state-of-the-art microchips from Globalfoundries Inc., a company owned by Abu Dhabi, leading to fears of malicious content being installed in chips used in satellites and missiles.

The terms of the seven-year arrangement are not public, according to The Wall Street Journal.

[dcquiz] IBM formerly supplied the chips to the Pentagon, but sought to dump two of its plants involved in the manufacturing process after deeming them unprofitable. Globalfoundries then decided to pick up those two plans for the sum of $1.5 billion. Now, the Pentagon has to deal with Abu Dhabi, although it says it’s following the recommendation of the Government Accountability Office (GAO) to find more than a single source for advanced microchip purchases. Relying on a single source, the GAO said, makes “future access” precarious.

Pentagon officials have repeated the need to expand to global markets to stay on the cutting edge of microchip technology, which presents numerous security challenges.

When chips are manufactured abroad by companies outside of the United States, the problem arises of other sovereign powers using these companies as proxies to penetrate U.S. security by installing killswitches or other malicious content.

To help combat malicious chip content, Defense Advanced Research Projects Agency (DARPA) is working on a tagging device to detect any kind of microchip tampering. There are also other options being explored, namely segregating different parts of the supply chain and completing final assembly of all the parts in a final, secure location.

Other chip makers based in the U.S. are upset at the Pentagon’s global gaze. A coalition of these groups has asked for the U.S. to fund upgrades to U.S. plants for security purposes. But the Pentagon seems intent on buying chips from the government-owned semiconductor foundry.

Moreover, the future of Globalfoundries is not even secure. Abu Dhabi as of November has mulled over selling part or all of the company to potential buyers. The company could be valued at anywhere from $15 to $20 billion. Part of the reason for the possible sale is that the United Arab Emirates has hit a huge slump since the price of oil has tanked, even though developing a chip manufacturing industry was part of the country’s plan to diversify away from oil.

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