Last week, the US government announced $2 billion in investments in quantum computing companies, allocating $100 million each to a range of startups in exchange for equity in the companies. Those could be make-or-break investments for many companies that are likely years away from a product that could see widespread use. But a member of the US Congress is now arguing that those deals are illegal, as Congress did not allocate the money for this purpose—instead, it was meant to support public research in semiconductors.
But the biggest chunk of money would go to a company that likely wouldn’t exist if it weren’t for the government’s backing. Anderon will be set up with a billion dollars each from IBM and the government and will inherit personnel and IP from IBM. It will serve as a foundry for fabricating quantum processing units and will contract its services out to IBM and any other company that wants access to cutting-edge hardware.
Is any of this legal?
Zoe Lofgren (D–Calif.), the ranking member of the House Science, Space, and Technology Committee, made it clear that she is not happy with how the government is using its money to support this technology.
“This announcement is illegal and troubling on so many levels,” Lofgren said one day after the announcement, pointing out that the money being used for the deal comes from the CHIPS and Science Act, which was passed during the Biden administration and was allocated “specifically for microelectronics R&D, with a focus on semiconductor technology.”
That technology overlaps only partially, at best, with what’s used in quantum processors. In addition, Lofgren says the money was allocated to foster public/private research partnerships, which these deals most decidedly are not. Finally, she noted that the largest sum of money will go to IBM, and she suggested that a former IBM executive (Dario Gil, current Under Secretary for Science at the Department of Energy) was involved in the negotiations that led to this deal.
None of this, she noted, means that quantum processing technology is a bad investment or that any of these companies are unworthy of support. She just argues that doing so would require Congress to allocate the money to do so.
At this point, however, it’s not obvious how to stop the deal. A lawsuit is the obvious choice, but that would require a party with standing to sue. It’s possible that a company that might otherwise have used the money for the intended research (a public-private partnership focused on electronics) could argue that it has been harmed by the diversion of the funds to a different field. But that argument would likely take so long to sort out in court that all the money would have been spent by then.
A quantum foundry
One thing that has helped IBM stay at the forefront of quantum computing is its access to in-house materials scientists and fabrication capabilities. Those resources have enabled the company to manufacture chips that test alternate designs and rapidly iterate and refine successes—an advantage powerful enough that Google also decided to open its own fabrication facility.
Given that, it’s somewhat surprising that IBM is choosing to spin these efforts into a separate company, called Anderon, which it will fund with $1 billion, alongside an equal government investment. According to the company’s announcement, it will also be handing over “significant intellectual property, assets, and a skilled workforce” to the newly launched company. The result could resemble TSMC, with the company fabricating quantum chips for firms that submit a design and pay the cost.
Not just any companies, though. IBM has specialized in producing transmons, a specific type of hardware that can host a qubit. But it’s not the only game in town. Other companies, including a number funded in the same announcement, are using technologies that host qubits in very different hardware or no hardware at all. This is very much a case of using government money to favor a specific category of technology.
That said, the move will likely be good for the broader field. A significant number of companies are designing transmon-based hardware that differs in important ways from IBM’s approach. But they’re stuck producing a limited number of test samples in fabs that may not specialize in quantum hardware, or where they have to compete with academic users for fabrication time. The launch of Anderon means those companies should now be able to access higher-quality hardware and rapidly iterate on designs. It will make testing their ideas less dependent on whether the fab they’re using produces high-quality hardware.
For IBM, this may reflect a confidence that the company has already extracted the major benefits of rapid iteration and is safely ahead of its competition. Jay Gambetta, the leader of IBM’s quantum computing efforts, has told Ars that the current hardware error rates for its chips are where they need to be to move forward with large-scale computing. Lower errors would be better, and the company has some ideas for how to achieve them, but they’re not strictly necessary for the next few years of development.
If that’s the case, why not have the government assume half the cost of staff and facilities?
What’s the long term?
We’re likely still several years away from useful error-corrected quantum computing, and closer to a decade from tackling some of the large, complicated problems where quantum computers could see widespread use. At the moment, though, it’s still unclear which technology (or technologies) will ultimately get us there first or prove capable of scaling for a decade or more. Keeping some of these companies viable for the next few years could be critical to ensuring that these technologies receive a full evaluation against those standards.
At the same time, the deal all but guarantees we’ll be investing in companies that are certain to fail. In the past, that has often devolved into cheap political point-scoring.
Longer term, it’s not entirely obvious how large Anderon’s target market will be. With a large number of startups, there will likely be a strong demand for these sorts of chips as companies test design variants and configurations. But even assuming the market settles on transmons, it’s not clear how large the annual need for these chips will be.
Transmons must be operated at milliKelvin temperatures, and large-scale, error-corrected quantum computers will likely require chaining together chips housed in multiple refrigerated containers. That will likely mean most of the hardware in use will sit in just a few data centers and be accessed online (as it is currently). Consequently, there’s a real potential for a boom-and-bust pattern in the market for these chips.
