The semiconductor industry really took off in Japan in the late 1970s after the Ministry of International Trade & Industry funded $200 million of a catch-up program called the VLSI Project. Well, MITI is at it again. The ministry has just unveiled plans for another $200 million push--aimed at nanotechnology, or techniques for building ultratiny semiconductor devices, in some cases atom by atom. The cast of characters is mostly familiar: Among those that have already signed on are Fujitsu, Hitachi, NEC, and Toshiba. But this time, MITI hopes that they will be joined by Texas Instruments, Motorola, IBM, and other U.S. and European high-tech companies. That's because $200 million will just scratch the surface of the required investment.
One goal of the Atom Technology Project is to develop methods for building a memory chip that can store 16 billion bits of data. That's 1,000 times as many as the latest 16-megabit chips, which most suppliers won't produce in volume until next year. Such chips will require transistors so small that it would take several thousand to span the width of a human hair. The R&D cost of a 16-gigabit chip could run $2 billion-plus, chipmakers estimate.