Silicon and Sand
It's taken me a few days to post about this because I've been out of town visiting my cousins in NYC ("Come Mr Tally man, tally me banana!"), before starting the new job on Monday. I have been twittering but I haven't figured out how to post those updates to the blog yet but I will soon... but I digress, because this news is fairly significant.
Chip-maker AMD has signed an agreement to split it's operations. AMD will apparently become a design company, while spinning off it's operations and manufacturing into a separate company. That manufacturing company (with the uninspired placeholder name, Foundry) will be partly owned and apparently wholly operated by the Abu Dhabi-owned company Advanced Technology Investment Company.
This remarkable not just because this is another semiconductors company is getting away from doing their own manufacturing. It is also remarkable because of the new owners. There has been a shift in the United Arab Emirates to diversify their economy and move away from oil. This move has been seen in the rise of Dubai Ports World as a major port operator that came extremely close to operating American ports (before the deal was scuttled by a xenophobic and panicked Congress), and now a surprising move into semiconductors. The deal is subject to approval from the Federal government due to technology transfer issues, and may not go forward in its current form. That doesn't make it any less important. This signaling of an earnest effort to branch out from the petro-economy is heartening to me in a way. Firstly, there is the fact that some people on the Arabian peninsula are hedging against the end of oil, which is a stunning admission. Secondly, there is a move towards high tech industry which implies a shift in attitudes towards education (always valued, but so far usually just outsourced). The question now is, how serious is this? The capital outlay suggests it's serious as a heart attack - this is not throwaway money, and failure here would have wide ranging effects in the technology sector (as would success for that matter).
I am hopeful that it is at least a modest success. While I don't want to overstate the stakes, I feel like the success or failure of this venture could affect the speed with which the Middle East will start moving more fully into full engagement with the wider world. A speed which will move it further away from the unbalanced consumerism that is prevalent in the Persian Gulf to a more productive model. With any luck that may push them to encourage it in their poorer neighbors to the east and west.