Haley Viccaro | October 20, 2014

ALBANY — The $1.5 billion deal for GlobalFoundries to take over IBM’s computer chip manufacturing branch will boost research and development at SUNY Polytechnic Institute in Albany, formerly known as the College of Nanoscale Science and Engineering.

GlobalFoundries will acquire and operate IBM’s facilities in East Fishkill, Dutchess County, and Essex Junction, outside of Burlington, Vermont. The company will employ nearly all of IBM’s workers at those plants with more than 5,000 headed to GlobalFoundries, boosting the company’s payroll to nearly 8,000.

IBM and GlobalFoundries currently conduct next-generation computer chip research at SUNY Poly, which recently merged with the SUNY Institute of Technology in Utica. Also conducting research at the college are industry leaders Intel, Samsung and Taiwan Semiconductor Manufacturing Company (TSMC).

Alain Kaloyeros, CEO of SUNY Poly, said the deal would lead to new programs, investments and jobs at the Albany campus.

“The governor is calling it ‘mAlbany’ — a combination of Malta and Albany — because in his mind investments have been made for a high-tech mall at CNSE,” Kaloyeros said. “The nanocollege is basically the hub and heart of all of this. The goal was to make sure manufacturing and development are anchored here in New York around the heart of the deal, which is mAlbany.”

The companies are working together as part of SUNY Poly’s Global 450 Consortium to help the industry transition from making computer chips on 300mm wafers to 450mm wafers. Wafers are the platforms on which computer chips are etched. The move is expected to increase production and decrease costs.

As part of the deal between IBM and GlobalFoundries announced Monday, IBM will focus on research while GlobalFoundries will focus on manufacturing. The two companies will work together with the ultimate goal of making computer chips on larger wafers at GlobalFoundries’ plants in Malta, Singapore and Germany.

“We can continue doing the research and now we have a manufacturer to do the manufacturing,” said IBM spokesman Clint Roswell. “That’s the symbiotic relationship. GlobalFoundries will be IBM’s manufacturing partner to meet customers’ needs. Both companies will continue to work at the nanocollege, and that research is only going to be strengthened by our relationship. There is a commitment to push that forward.”

In July, IBM pledged to spend $3 billion over the next five years on semiconductor research, a majority of which Kaloyeros said would be done in New York and at SUNY Poly. That commitment remains unchanged. GlobalFoundries will now have primary access to that research.

“All of the research is going to be done at CNSE and it is going to feed the development in Yorktown, manufacturing in Malta and servers in  Poughkeepsie,” Kaloyeros said. “IBM has multiple businesses, and the company is very much interested in maintaining its hardware and software. GlobalFoundries is going to supply IBM with the chips.”

Kaloyeros said under the agreement the output has essentially tripled, with IBM and GlobalFoundries working as separate companies and IBM and GlobalFoundries working together as a team. That will lead to an increase in research and jobs in Albany.

IBM jobs will be retained through GlobalFoundries following layoffs at IBM’s facilities nationwide earlier this year. In February, IBM reached an agreement with SUNY Poly to retain 3,100 jobs in New York through 2016. The deal was tied to IBM’s expansion in Buffalo, where the company plans to add 500 jobs at the Buffalo IT Innovation and Commercialization Hub.

SUNY Poly, under the direction of Kaloyeros, has been pushing into other areas including Buffalo, Rochester, Syracuse and Utica. The expansion of nanotechnology research and development statewide has been a driving force of Gov. Andrew Cuomo’s economic development plan, particularly upstate.

“There is significant potential to benefit all of the hubs,” Kaloyeros said. “Any investments in Albany would benefit Utica and would also benefit Buffalo. Any investment in one of the regions would benefit all of these regions now because they are part of the same ecosystem.”

SUNY Poly has more than $20 billion in high-tech investments with more than 300 corporate partners. More than 3,100 researchers, students and faculty work at the college. SUNY Poly is currently expanding in Albany with the construction of a new Zero Energy Nano building, which is expected to be completed next year.