Extreme ultraviolet (EUV) mask blanks with embedded phase defects were inspected with a reticle actinic inspection tool (AIT) and the Lasertec M7360. The Lasertec M7360, operated at SEMATECH's Mask Blank Development Center (MBDC) in Albany, NY, has a sensitivity to multilayer defects down to 40~45 nm, which is not likely sufficient for mask blank development below the 32 nm half-pitch node. Phase defect printability was simulated to calculate the required defect sensitivity for a next generation blank inspection tool to support reticle development for the sub-32 nm half-pitch technology node. Defect mitigation technology is proposed to take advantage of mask blanks with some defects. This technology will reduce the cost of ownership of EUV mask blanks. This paper will also discuss the kind of infrastructure that will be required for the development and mass production stages.