An inside look at how ASU, local governments, and private sector companies are working together to make Arizona a hub for advanced packaging innovation.
The year 2022 was monumental for the semiconductor industry. That year, the Biden-Harris administration committed to making the U.S. a world leader in semiconductor manufacturing by passing the bipartisan CHIPS and Science Act. In an effort to decrease the nation’s reliance on China for chips, and to meet the demands of advanced technologies, the CHIPS Act highlighted plans to invest $53 billion in onshoring semiconductor manufacturing, with $1.6 billion going toward advanced packaging.
Due to current onshoring efforts for semiconductor manufacturing, it wouldn’t make sense to build front-end capacity in the U.S., only to send the chips overseas to be packaged. With a major boost in funding pouring into the country’s advanced packaging ecosystem, it’s almost hard to believe that packaging was once regarded as little more than a cost burden. In a swift change of events, it’s emerging as the industry’s best chance for continuing Moore’s Law. This famous industry observation states that transistors on an integrated circuit (IC) will double every two years.
To keep up with power, performance, area, and cost requirements, the industry is turning to advanced packaging technologies like 2.5D and 3D stacking. By optimizing the package, chip manufacturers can continue to pack more compute power in less space. This is essential for advancing artificial intelligence (AI), high-performance computing (HPC), and more.
As advanced packaging moves into the spotlight, Arizona is becoming a key player in this integral manufacturing process. As a result, local governments and private sector companies are collaborating to boost Arizona’s semiconductor manufacturing dominance.
Arizona’s Private Sector Growth
In February 2024, Amkor announced the approval of its outsourced semiconductor assembly and test (OSAT) facility in Peoria, Arizona. Once the facility is completed, it will make history as the largest OSAT facility of its kind in the U.S. (Figure 2)
Amkor’s $2 billion investment will not only provide Arizona with a world-class packaging center, but it will also create 2,000 new jobs for Arizonans. In addition, Amkor is the only U.S. headquartered OSAT provider that offers both high-volume manufacturing and advanced packaging capabilities. Although the facility’s opening date has yet to be announced, its creation marks a leap forward in strengthening Arizona’s advanced packaging foothold.
Alongside its new facility, Amkor also announced a memorandum of understanding with TSMC to work together on delivering high-volume advanced packaging and testing technologies to its customers. The proximity of Amkor’s upcoming back-end facility and TSMC’s front-end fab will help further improve product cycle times, boosting industry activity in the Valley.
While I was interviewing companies for this article, I asked all of them why they chose to have a presence in Arizona. I received several answers, but access to government funding, proximity to local and California-based customers, and a robust talent pipeline came out on top. However, something I found particularly interesting was learning just how purposeful Arizona’s move into advanced packaging has been.
“You have everybody from the governor down focused on growing a semiconductor ecosystem,” said Eelco Bergman, Chief Business Officer at Sara’s Micro Devices. Sara’s Micro Devices opened its first Arizona manufacturing center in Chandler in January 2024. (Figure 3)
Bergman shared that Arizona’s governmental organizations, such as the Arizona Commerce Authority (ACA), the Greater Phoenix Economic Council (GPEC), and city governments, are focused on attracting semiconductor companies. This strong government support, as well as competition between cities, helps bring the talent needed to create a thriving ecosystem.
“None of these companies, including ourselves, operate on their own,” Bergman said.
Similar to Sara’s Micro Devices, Yield Engineering Systems (YES) also opened a new facility in Chandler in July of 2023. Incidentally, the two companies share the building. (Figure 4)
Vik Chaudhry, VP and Head of Strategic Marketing at YES, mentioned that the company opened its new facility in Chandler to be close to two of its biggest customers – Intel and TSMC. The city’s large talent pool and business-friendly climate also drew YES in.
The company has a strong focus on glass core substrates, and with the continued growth in this area of packaging, the company expects to add around 100 new roles in the foreseeable future.
Arizona State University’s Role in the State’s Semiconductor Ecosystem
With so much emerging innovation in Arizona, the state needs to build and retain a robust and talented workforce. Although workforce development has historically been a hurdle for the semiconductor industry, Arizona State University (ASU) is helping to bridge this gap (ASU).
“We have a close relationship with not just the city and the state, but also with ASU,” said Ron Huemoeller, CEO of Sara’s Micro Devices. “ASU has a significant amount of funding and effort going into package development that we are now a part of with them. There’s a big assist with development and talent, and they also help us with access to the government.”
But ASU isn’t the only university in the U.S. that has semiconductor initiatives. Earlier this year, Northern Arizona University received a $13 million grant from the ACA to fund its semiconductor metrology program. The University of Arizona also has a Center for Semiconductor Manufacturing, where students can earn a graduate certificate in microelectronics packaging. Additionally, the Maricopa County Community College District introduced a 10-day training program for semiconductor technicians.
So I had to ask – what sets ASU apart from other schools across the country? From what I gathered, other schools also have stellar research capabilities, but they’re not located in states where growing the advanced packaging industry at large is a top priority. To learn more about ASU’s role in expanding advanced packaging, I visited ASU’s MacroTechnology Works center in Chandler. While I was there, I spoke with key leaders from both ASU and Deca Technologies.
In March of 2024, the two organizations announced their partnership to create North America’s first Fan-Out Wafer-Level Packaging (FOWLP) research and development capability. FOWLP is a packaging approach that helps build higher-density packages by fanning out the interconnects through a redistribution layer (RDL), and it does this at a lower cost than silicon interposer technology. FOWLP is important because high-density packages are becoming increasingly relevant for scaling AI, electric vehicles, and more (Figure 5).
The Relationship Between ASU, Deca, and the State of Arizona
Although the R&D center is still in progress, the partnership between ASU and Deca is very much alive. For instance, this past November, the National Institute of Standards and Technology (NIST) announced that ASU and Deca were selected to lead the SHIELD USA initiative. This project aims to promote innovation within the domestic advanced packaging industry, expand capacity, and help the U.S. regain its leadership in this area of microelectronics.
With so much in the works, I asked Zachary Holman, Vice Dean for Research and Innovation for ASU’s Ira A. Fulton Schools of Engineering, about how the ASU and Deca partnership came to be.
In short, Holman shared that federal and state funding allowed ASU and Deca to form their partnership. Deca is a leading provider of advanced packaging technologies headquartered in Arizona, and the company is most known for high-volume FOWLP solutions that power many of the world’s smartphones. In addition, ASU’s Fulton Schools of Engineering had 33,000 students as of 2024.
However, ASU wasn’t always strong in packaging, so I had to ask. What made ASU want to compete in this industry? Was this driven by the state’s increasing need for packaging talent? The short answer is yes.
Holman highlighted that in 2020, ASU began working on its strategy for microelectronics in terms of university research, partnership, and innovation. He mentioned that ASU initially focused on materials due to its existing expertise in that area. The university soon expanded into advanced packaging to meet the needs of the local semiconductor ecosystem.
“We realized that we needed to produce the talent for these companies to hire and that we needed to have innovative faculty members who were teaching that next generation,” Holman said. “So, we made a strategic play in packaging.”
Holman also shared that Deca was a natural partner due to its proximity to ASU, and he emphasized Deca’s advanced technology and natural understanding of ASU’s goals. It was easy to find common ground, he said, because the company had a strong grasp on the future of advanced packaging.
Together, the organizations work to attract talent and align their efforts to meet the demands of Arizona’s advanced packaging needs. Tim Olson, CEO of Deca, echoed the benefits of this partnership.
“We needed a partnership where we could have a physical facility and continue to innovate – to take what we had and continue to build future generations,” said Olson. “ASU is perfect for that. Perfect location-wise, perfect mindset-wise.”
A big part of teaching the next generation of packaging professionals is providing them with hands-on experience. While I was at MacroTechnology Works, I asked Holman to explain the difference between gaining real-world experience at ASU and gaining experience as an intern in a fab.
“As an intern, you don’t get to go into the fab and turn a knob, because you might break something,” he said. “Internships are fantastic for students, but someone that is on a three-month summer internship isn’t going to have responsibility.”
With students gaining direct, hands-on experience with advanced packaging tools, Holman also shared advice for companies that want to engage students earlier on.
Students, he said, are using equipment that was donated by local companies, and those companies have engineers who come to ASU and explain how the tools are used in fabs. This approach helps turn students into ambassadors for the tool companies because they’ve worked on their systems before. Students may also end up working at the tool companies themselves.
Perspective From Long-Established Arizona Semiconductor Companies
As The CHIPS Act and local government funds made its way into the state, I wanted to know how recent growth impacted semiconductor companies that were already in Arizona. Did they benefit from any of this, or were they too far ahead of their time?
To find out, I revisited the MacroTechnology Works facility to meet with EV Group – a company that has been in Arizona since 1994. EV Group is headquartered in Austria and has a broad global presence, but its Chandler facility is home to a class 100 cleanroom and onsite equipment lab (Figure 6). While I was there, I spoke with Vineeth Reddy Bijjam, the company’s Director of Technology and IP.
Right from the beginning, EV Group’s founders believed that Arizona would become an epicenter for semiconductor technology. Although the company didn’t receive state or federal funding, Bijjam shared that EV Group benefits from local growth indirectly because its customers are now incentivized to come to the state.
“Our lab is a strategic piece of infrastructure that’s helping us partner with local customers,” said Bijjam. “We engage with them in the very early stages of development and provide them with a shorter feedback loop, so they don’t have to wait for broader lead times to get their prototypes.”
In addition to customer partnerships, Bijjam also highlighted EV Group’s active internship program with ASU and the company’s relationship with several university professors.
Finetech is another global company with a longstanding Arizona location. Opened in 1999, Finetech’s Mesa, Arizona location is home to its sales and support center for all equipment it sells in the U.S. The Mesa location also features a showcase room with all of the company’s equipment, so customers can run feasibility trials and access Finetech’s process development services. (Figure 7)
“University sales have really picked up in the past year, specifically due to funding from the CHIPS Act,” said Neil O’Brien, General Manager at Finetech Americas.
O’Brien also highlighted increasing opportunities for Finetech to work with customers on process development and experimentation initiatives, specifically on projects that have received funding from the CHIPS Act.
Key Takeaways
Arizona is working to create a robust advanced packaging ecosystem, with all parties working effectively together to build the future of this industry. Local governments are incentivizing businesses to bring their advanced packaging capabilities to Arizona, and ASU is working to educate and train the next generation of packaging professionals in accordance with the needs of Arizona’s local companies.
Although companies that had a pre-existing presence in Arizona aren’t benefiting from funding directly, the influx of new businesses in the state has led to increased tool sales, partnership opportunities, and access to a broader talent pool.
Will Arizona be able to maintain its momentum and establish itself as a North American hub for packaging innovation? Only time will tell, but I’m optimistic for the future.
This article first appeared in the 2025 3D InCites Yearbook. Read the full issue here.
Editors Note: This story keeps growing. Read on for ongoing developments for Arizona advanced packaging initiatives.
- ASU selected as home and partner for CHIPS and Science Act-funded national facility for semiconductor advanced packaging
- IFTLE 611: Amkor Clarifies Arizona Facility Activity
