Schenectady County

IBM, state to join forces

Gov. David Paterson announced Tuesday that IBM Corp. will invest $1.5 billion in three projects in u

Gov. David Paterson announced Tuesday that IBM Corp. will invest $1.5 billion in three projects in upstate New York and in return the state will give the company $140 million in state economic development grants, a combined effort expected to create up to 1,000 high-tech jobs.

“This is a tremendous example of the cooperation between the public and private sector, which is what we’re going to need to reignite the engine of this state’s economy,” Paterson said.

The separate components of the project are the expansion of IBM’s operations at the College of Nanoscale Science and Engineering at the University at Albany, the creation of a new semiconductor packaging research and development center at a “yet-to-be-determined upstate location” and the upgrading of IBM’s facility in East Fishkill, Dutchess County, forestalling layoffs at that facility.

IBM spokesman Fred McNeesey said the company plans to spend $1 billion upgrading its East Fishkill facility, and the remaining $500 million of its investment will be divided between its expansion at the UAlbany NanoCollege and the new packaging research center. He said some of the $500 million contributed to those sites will include the value of allowing the use of IBM intellectual property and equipment rather than a cash investment.

Paterson said IBM will spend $375 million to expand its advanced semiconductor tooling operation at the NanoCollege and the state will add $25 million toward that project, which should result in 325 new research and development jobs. He said the state has also agreed to provide grants tied to job retention at IBM’s East Fishkill facility.

“Our country has unfortunately lost jobs in the private sector over the last six months and IBM, unfortunately, has at times had to be a part of that unfortunate decision to have to let workers go, but … IBM will order a retention of all 1,400 jobs at their East Fishkill facility in Dutchess County and New York state will augment that with an additional $65 million to make sure those workers are still creating opportunities in New York state,” Paterson said. a

John Kelly, IBM senior vice president and director of research, thanked Paterson for “personally stepping in to make this deal happen.”

He also thanked Sen. Joseph Bruno, R-Brunswick, and Assembly Speaker Sheldon Silver, D-Manhattan, for supporting the state funding. He said the combined investment by New York state and IBM will help further the advancement of semiconductor technology.

“Today we have nearly 1 billion transistors on a semiconductor chip the size of a fingernail. With [nanotechnology] we will increase that to 10 to 100 billion transistors per chip in the next several years. We will expand and extend our efforts here at Albany NanoTech,” Kelly said.

Paterson said the state will contribute $50 million in grants from next year’s executive budget for the semiconductor packaging research center.

The term “packaging” in the semiconductor industry refers to the last stages of assembling a semiconductor. Kelly said the new research center will help overcome some of the major challenges to packaging the smallest semiconductors.

“The new packaging center will allow us to connect the macro world with that nanoscale world, and the impact will be enormous,” Kelly said. “Future generations of nanotechnology devices will be used in everything from gaming devices to supercomputers.”

Nanotechnology is manipulation of matter on a microscopic scale. For perspective, one human hair is about 80,000 nanometers thick.

State officials said the 120,000-square-foot packaging research center will be established, managed and owned by the NanoCollege, with IBM conducting operations at the site. Rensselaer Polytechnic Institute will also be a research partner in the new packaging facility. The project is expected to create 675 high-tech jobs.

Alain Kaloyeros, senior vice president and chief executive officer of the NanoCollege, did not disclose the possible location of the packaging plant but did allude in a news release to a site somewhere in western New York.

“To my knowledge, this initiative represents the first cross-regional collaboration in New York’s history, with critical job creation and funding benefits spanning from Buffalo to [the] Hudson Valley,” Kaloyeros said in the news release.

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