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On a snowy Friday in January, dignitaries from both political parties braved the chill of a central New York winter for the groundbreaking ceremony of Micron Technologys planned $100 billion manufacturing complex in Clay, a town not far from Syracuse. Over the next 20 years, Micron is promising the region thousands of jobs and the revitalization of a community hard hit by the decline of manufacturing. Since President Joe Biden signed the CHIPS and Science Act in 2022, billions of public dollars have flowed into domestic semiconductor manufacturing as the United States seeks to revitalize an industry that was born in the U.S. before it was largely outsourced to East Asia. Both Democrats and Republicans have argued that domestic chip production is essential to national security, citing the role advanced semiconductors play in military systems as well as in critical infrastructure like financial and telecommunications networks. In order to expedite the development of up to four fabrication plants in central New York state, Micron may receive as much as $25 billion in public subsidies, including $6.1 billion from the federal CHIPS Act, $5.5 billion from New York state and billions more in refundable manufacturing tax credits. But some residents and advocates question whether the Micron project, as its currently planned, will bring more harm than good. The facility will consume vast amounts of water and energy while producing substantial hazardous waste, according to the companys environmental impact statement. Emissions and contaminated wastewater and soil from the notoriously dirty semiconductor industry pose potential environmental and health risks for surrounding areas, while exposure to its toxic chemicals has been linked to cancers and reproductive harm. Community members want enforcement measures to ensure the company follows through on promised environmental safeguards and its pledge to create 9,000 jobs. Were not trying to stop any progress, but we dont want this just bulldozed into our area, said Gracia Roulan, a nurse practitioner who has lived in Clay all her life and is part of the local group Neighbors for a Better Micron. Roulan said advocates like her want to ensure the project is truly better for the community, and raised concerns about potential pollution of the local water system and the clearing of the beautiful marshes all around the area, which provide a home to endangered species. To make way for the new structures, the project will fill more than 200 acres of wetlands. For its part, the company touts the projects benefits to the region, including a promise to invest hundreds of millions of dollars in education, worker training and affordable housing over the next two decades. Micron is committed to being a great member of the community and a responsible environmental steward, Anna Newby, a Micron spokesperson, said in an email to Capital & Main. The company has committed to developing new wetlands to offset those that will be destroyed. Newby said the environmental review process Micron undertook for its central New York project was thorough. Yet just hours before Micron broke ground, Neighbors for a Better Micron, alongside national worker advocacy group Jobs to Move America, filed a lawsuit against the project in New York Supreme Court for Albany County, arguing that the state permitting process was unnecessarily rushed and did not adequately consider public input. The suit names Micron along with state and local agencies, contending that despite the states reputation for having some of the strongest environmental laws in the country, the review process fell short, particularly given the size and scope of the project. The lawsuit points to the agencys failure to balance economic benefits and environmental harms, said Meredith Stewart, litigation director at Jobs to Move America. She said the court should reverse the environmental approval and require agencies to revisit the impact of the project in order to ensure harms are adequately addressed. But in New York and elsewhere around the country, proponents of semiconductor projects would like to see less, not more, environmental review. Lawmakers in famously eco-friendly California recently approved legislation allowing semiconductor companies to bypass environmental impact studies. In 2024, President Biden signed a law exempting most publicly funded semiconductor projects from federal environmental review, a move supporters said would speed construction and help the U.S. compete with China. Microns project nonetheless underwent federal as well as state scrutiny, with the federal review triggered by its impact on wetlands. Under the new law, the Commerce Department oversaw the federal process, and at Microns groundbreaking, Secretary Howard Lutnick praised his agencys rapid pace. See, this groundbreaking only got scheduled at the end of December because the Trump administration cleared out all of the environmental and other things that tend to get in the way, Lutnick said. The lawsuit brought by advocates asserts that community members were given insufficient time just 32 business days to review and provide public comment on an environmental impact statement that exceeds 700 pages or roughly 22,000 pages including supportive materials. Environmental review is one of the only levers that the public has to learn what the impact [of a project] might be on their community, said Judith Baish, director of CHIPS Communities United, a coalition of unions and community groups advocating for a safer and more equitable semiconductor industry. Some residents worry that the project will strain local infrastructure. When the project is completed, the company expects it to use 48 million gallons of water from Lake Ontario each day, enough to supply more than 585,000 homes. The county is developing a new wastewater treatment plant, and upgrading an existing one, to deal with the increase in volume. The project also poses risks to resident and worker health, advocates say, as the semiconductor industry has a well-documented history of toxic pollution. In order to transform raw silicon into the advanced components that power nearly all modern devices, chipmaking relies on hundreds of chemicals, many of them harmful. One of the biggest culprits, according to advocates, is per- and polyfluoroalkyl substances (PFAS), so-called forever chemicals that do not easily break down in the environment and are central to semiconductor manufacturing. Communities near semiconductor manufacturing facilities have faced contamination of soil and groundwater, while workers in chip fabrication plants have reported elevated rates of cancers and reproductive health issues. Beyond environmental risks, many activists say that Microns claims about the projects benefits are vague or lack the teeth of enforcement. They would like to see the billions of dollars in subsidies awarded to the company conditioned on whether it delivers on its promise to create thousands of jobs. Advocates also want the company to hire from the community and are concerned they may simply import workers into the area. A 2023 study found that more than a third of projects subsidized by state governments between 2004 and 2015 failed to meet their job creation goals. Researchers said the true figure may be higher because many states have weak disclosure requirements. Roulan pointed to a history of industrial projects in the region that came with pledges to improve the community but instead left behind pollution, the most famous example being the now defunct Allied Corporations contamination of Syracuses Onondaga Lake, which contributed to the lake being designated a Superfund site. We want development, we want to see jobs come here, Roulan said. But not at any cost. Last month, a separate coalition of advocacy groups in the Syracuse area, including Jobs to Move America, launched an effort to urge Micron to sign a legally binding community benefits agreement, a contract negotiated between a private company and community stakeholders that outlines benefits and mitigations that the company agrees to provide. The group, Central New York United for Community Benefits, sent a letter to Microns CEO just days after the groundbreaking ceremony, requesting a meeting. A community benefits agreement, the group said, could help ensure strong wages and benefits for the projects permanent workforce and protect residents access to clean air and water. Micron has pledged to hire 80% of its initial construction workforce locally and to use a project labor agreement, ensuring unionized construction labor. Newby said in an email that the company had already invested more than $15 million in local organizations and educational institutions as part of its pledge to invest $250 million over 20 years in a state fund aimed at developing the semiconductor manufacturing workforce in central New York state as well as supporting community needs such as affordable housing. Meanwhile, Roulan is already seeing changes following the groundbreaking giant trees going out by the truckful and tons of traffic changes around the area, which she said were signs of major disruption to come. Kalena Thomhave, Capital & Main This piece was originally published by Capital & Main.
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E-Commerce
Dario Amodei, CEO of Anthropic, will head to the Pentagon on Tuesday to meet with Defense Secretary Pete Hegseth about how the military uses the companys artificial intelligence models. And its likely to be a tense meeting, as sources first told Axios. Contract talks between the AI startup and the Department of Defense have gone off course in recent weeks as Anthropic has insisted on some safeguards for how its technology will be used. While the San Francisco-based company is willing to loosen some of its usage restrictions for the Department of Defense, it doesnt want its models used for at least two specific purposes: spying on Americans or developing autonomous weapons. Heading into Tuesdays meeting, the two factions seem to have differing views on how those contract talks have been proceeding. While a spokesperson for Anthropic said in a statement Monday that the company is having productive conversations, in good faith with the Pentagon, a Defense Department spokesman said last week that Anthropics relationship with the Pentagon is under review. Anthropic knows this is not a get-to-know-you meeting,” a senior Defense official told Axios. “This is not a friendly meeting.” ANTHROPICS ROLE IN NATIONAL SECURITY Anthropic is currently the only AI company available in the militarys classified networks and was among several companies awarded a $200 million contract with the Defense Department to in July advance U.S. national security. The company has repeatedly reiterated its commitment to supporting national security, including again on Monday. In June, it announced Claude Gov, a suite of models it built exclusively for U.S. national security customers. And yet, Amodei has become vocal about balancing the opportunities that AI presents with the concerns that it poses. In a lengthy piece published last month, the Anthropic co-founder warned: Humanity is about to be handed almost unimaginable power, and it is deeply unclear whether our social, political, and technological systems possess the maturity to wield it. At the India AI Impact Summit last week, Amodei that hes concerned about the autonomous behavior of AI systems and the potential for misuse of AI by individuals and governments. THE MADURO FACTOR Another factor thats strained the relationship between Anthropic and the Pentagon came to light last week: Claude was used in the U.S. militarys operation at the start of the year to capture former Venezuelan President Nicolás Maduro, as The Wall Street Journal reported. That mission would seem to violate Anthropics usage guidelines that prohibit, among other things, that Claude not be used to incite violence or for criminal justice and surveillance. The companys usage policy, most-recently updated in September, is intended to strike an optimal balance between enabling beneficial uses and mitigating potential harms. But Anthropic also notes that the company may enter into contracts with certain governmental customers that tailor use restrictions to that customers public mission and legal authorities if, in Anthropics judgment, the contractual use restrictions and applicable safeguards are adequate to mitigate the potential harms. POKING THE BEAR Anthropic has tried to set itself apart from the rest of the universe of AI developers with a safety-first approach thats even seen it take a swipe, via a Super Bowl ad, at OpenAIs recent decision to incorporate ads into the ChatGPT platform. While Amodei has emerged as a contrarian of sorts, at times, by pushing back on unrestricted use of its Claude AI model for the U.S. military, Amodei is effectively poking the bear that is Hegseth. As Axios reported last week, Hegseth has threatened that the Pentagon could declare Anthropic to be a supply chain risk, which would void its contracts and force other companies that work with the Pentagon to certify they arent using Claude in any related workflows. Our nation requires that our partners be willing to help our warfighters win in any fight, chief Pentagon spokesman Sean Parnell told media outlets last week. Ultimately, this is about our troops and the safety of the American people.
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E-Commerce
Fridays news of a major shake-up at Microsofts Xbox division caught the gaming world by surprise. Phil Spencer, who has run Xbox for almost 12 years, announced his retirement, effective immediatelyjust months after Microsoft insisted he was not retiring anytime soon. Asha Sharma, the president of Microsofts CoreAI product, was tapped to run the division. Once a powerhouse earner, Xbox has seen its profitability and influence shrink in recent years. (Xbox president Sarah Bond, long seen as Spencers heir apparent, was passed over and also left the company.) Sharma may face an uphill battle. Microsoft has not reported updated Xbox console sales or Game Pass subscription numbers in years. The available figures havent been encouraging. Xbox hardware revenue fell 32% year over year in the recent holiday quarter. Overall gaming revenue dropped 9%, and Xbox content and services, which includes Game Pass, declined 5%. Sharma has already taken some knocks online for lacking a deep history in video games. Some of that online blowback reflects the sexism that often runs rampant in gaming. (Sharma will be the first woman to run a major console manufacturer.) But criticism of her gaming pedigree also reflects a kind of gatekeeping. Strauss Zelnick, CEO of Take-Two Interactive Software, has said he was not a gamer when he took chargeand still isnt. Yet Take-Two has delivered a string of hits under his leadership, most notably the Grand Theft Auto franchise, and its share price has increased fifteenfold since he took the job. I don’t think anyone wants or needs my specific creative expertise, such as it is, Zelnick once said. It’s my job to attract, retain, and provide the resources to the best creative talent in the business. Dwindling sales and a divided focus Time will tell if Sharma follows that same path. But if she does, instead of focusing on big individual launches, shell have to persuade gamers to buy both the hardware and a subscription service that increasingly makes that hardware feel optional. The Xbox Series X and Series S have faced inventory issues in recent months and remain expensive when available. With memory shortages affecting a wide range of consumer technology products, a price cut anytime soon appears unlikely. At the same time, Microsoft has been pivoting away from consoles, expanding Game Pass across multiple platforms, including as an app on Samsung TVs. (An Xbox mobile store was planned but never launched.) Despite that shift, Microsoft has also been working on a next-generation Xbox, once expected to debut next year, though that timeline could slip due to component shortages. Starting over? Sharmas promotion could mark a reset, shifting focus back to consoles and exclusive titles rather than the Xbox anywhere strategy of recent years. Even then, some hurdles remain. Microsofts hands are tied with its biggest franchise, Call of Duty, which it acquired through the Activision-Blizzard takeover three years ago. Under its agreement with regulators, Microsoft must continue offering those games and features to Sony through 2033. Still, the company has deep development resources, even after steep layoffs. The Halo franchise has struggled but could rebound with a strong release. Bethesda Softworks, acquired in 2021, is developing a new Elder Scrolls title and also controls proven franchises such as Fallout and Doom. Microsoft also has Gears of War, Fable, and Forza, and enjoys strong relationships with independent developers. Refocusing on consoles could require changes to Game Pass. The services appeal lies in offering new titles on day one without requiring individual purchases. But with AAA games now costing $200 million or more to develop, Game Pass will need either a surge in subscribers or structural changes to remain viable. (A price increase could be challenging, as the top tier already costs $30 per month.) Whatever direction Sharma chooses, she faces a steep climb. Spencer may have been beloved by gamers, but Microsofts biggest bets of the past six years have largely fallen short. And as headwinds gather across the gaming industry, Microsoft is no longer the dominant force it was in the Xbox 360 era. Regaining that ground will require steady leadership.
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E-Commerce
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