US operators joined forces with chip and automakers to press the government to subsidise domestic chip production to help offset the effects of a global silicon shortage.

AT&T and Verizon are among the members of the newly-formed Semiconductors in America Coalition, alongside big names including Intel, Qualcomm, Apple, Microsoft, HPE, Nvidia and Samsung.

The group is asking Congress to approve the $50 billion in funding proposed by President Joe Biden for the CHIPS for America Act, which was unveiled in mid-2020 with the goal of providing an income tax credit for semiconductor equipment or manufacturing facility investment until 2026.

Estimates by the group place the cost of building and operating a chip factory in the US at between 20 per cent and 40 per cent more than countries where governments subsidise research and manufacturing.

The CHIPS for America Act also calls for the National Institute of Standards and Technology (NIST) to invest in research and development around chip manufacturing, and to establish a programme to match state and local government incentives offered to private companies to build production facilities.

National security is also a factor, with the bill proposing the Department of Commerce investigates if there are any threats in the current set-up of semiconductor supply chains.

The act proposes a trust fund for other nations which share information on supply chains and align with US trade rules.

On its recent earnings call, AT&T CEO John Stankey admitted to being “a bit skittish” about the equipment supply chain, with disruption potentially impacting all operators’ 5G network construction timelines.