European “Photonics” Chip Firms Have Asked the EU for $4.5 Billion in Support

Executives from a consortium of Europe’s leading “photonic” computer chip businesses have asked the European Union for $4.25 billion in financing to assist the expanding sector in competing with competitors in Asia and the United States.

Photonic semiconductors do computations using light rather than electrons, which has benefits in terms of speed and power consumption, making them more valuable for applications such as data centers and automobiles.

At a session in Eindhoven, the group provided EU authorities with an eight-year plan to assist and strengthen European supply chains, as well as giving smaller enterprises access to manufacturing locations for test runs.

“Currently, the EU has a vibrant and growing integrated photonics industry, however, without volume manufacturing, testing, and packaging capacity we are incredibly vulnerable to global events and the policies of competitor countries,” Johan Veenstra, CEO of SMART Photonics, said at the summit.

Although the European Union had already recognized photonics as a key technology and mentioned it as a prospective financing area under the 43 billion euro Chips Act enacted in April, it is unclear whether resources are allocated to photonics.

To grow, SMART, a contract producer of photonic chips, obtained $110 million in July via a combination of Dutch government money and debt financing from chipmaker NXP, as well as equipment manufacturers ASML and VDL Groep.

Currently, most photonics chips, like most chips, are manufactured in Asia, with significant intellectual property in the United States.

Low levels of European manufacturing and over-reliance on Asia in manufacturing and packaging, according to the statement, “threaten the EU’s economic security and resilience.”

The declaration was signed by XFAB and Aixtron of Germany, SMART Photonics and Phix Photonics Assembly of the Netherlands, VLC Photonics of Spain, Almae of France, and Ligentec of Switzerland, as well as PhotonDelta, a public-private partnership in the Netherlands focused to photonics financing.

The IT sector remains a hotspot of patent innovation. The expanding need for high-speed data transmission, advances in optical communication technologies, the need for energy-efficient solutions, and the growing relevance of technologies such as silicon photonics, indium phosphide, and gallium arsenide are driving activity. 

These technologies make it possible to integrate multiple photonic components on a single chip, opening the path for next-generation optical communication networks. 

190+ innovation areas will affect the future of the industry, according to GlobalData’s Technology Foresight, which maps the S-curve for the technology sector using innovation intensity models based on over 1.5 million patents.