Probably also for students with “just” a bachelor’s. Most PhD students don’t enter with a master’s.

I do wonder if NSF is hoping to seed more industry-sponsored PhDs as well, e.g., the first will be funded by NSF to establish the program, and industry will fund more once the program gets going.

Definitely makes sense to me they call it a PhD, not a master’s. A PhD is more prestigious and signals the holder is ready and eager to do cutting-edge research and has some experience doing so.

There are all kinds of master’s degrees (I say as someone who has one) and reasons for getting them, so they’re not as strong a signal of anything in particular. And they can mean someone switched careers, someone dropped out of a PhD program, someone took advanced classes during undergrad, someone got a bachelor’s in one country and wanted to study and work in another, etc.