"Expansion to Over 10 Cloud Companies with 50 Billion KRW Sales in 2023"

Ministry of Science and ICT Finalizes Cloud Industry Development Strategy

[Asia Economy Reporter Seulgina Cho] The government is accelerating the "National Cloud Transformation." While fully transitioning the public sector to the cloud, it will also implement a voucher program worth 20 million KRW per company to support small and medium-sized enterprises (SMEs) in using the cloud. The ecosystem will be actively fostered in a form where multiple service companies collaborate as cloud infrastructure companies. Through this, the government aims to increase the number of cloud companies with sales exceeding 50 billion KRW to more than 10 by 2023.

The Ministry of Science and ICT announced on the afternoon of the 24th, during the 16th meeting of the 4th Industrial Revolution Committee, that the "Cloud Industry Development Strategy in Preparation for the Data Economy and Artificial Intelligence (AI) Era" was reviewed and finalized. The government considers cloud as the core infrastructure essential for the collection, accumulation, and utilization of data, which is a key task of the Digital New Deal’s "Data and AI Activation." This development strategy aims for a national cloud transformation and strengthening of the cloud industry ecosystem.

Accordingly, the government will fully transition the public sector to the cloud, serving as a catalyst for innovation in administrative tasks and public services as well as for revitalizing the cloud industry. Systems that are newly introduced or have reached the end of their service life will be gradually transitioned to the cloud. To ensure the use of the latest private cloud technologies, agency-specific consulting and pilot projects will be conducted simultaneously. Cloud companies will also be supported to participate in government-led big data analysis and AI-utilizing business support projects.

Additionally, the government will innovate the procurement system to efficiently introduce private cloud services into the public sector. Beyond existing cloud services, a digital service concept will be introduced that includes new technologies such as AI, Internet of Things (IoT), and blockchain integrated with the cloud. For digital services, a "Digital Service Specialized Contract System" will be established, allowing demanders to quickly search and use needed services instead of the lengthy announcement-bidding-contract process.

In particular, for digital services selected by the "Digital Service Specialized Committee," composed of relevant ministries and private experts overseeing digital service-related tasks, non-competitive contracts without monetary limits will be permitted.

For the private sector, the focus is on supporting SMEs’ cloud usage. The existing "SME Cloud Usage Fee Support Project," which provided up to 3 million KRW per company, will be expanded into a voucher program offering 20 million KRW per company to comprehensively support consulting, transition assistance, and usage fees. The Ministry of Science and ICT expects this program to provide an opportunity for companies to move beyond simple cloud trial use to fully digitizing their work environments.

Finally, to encourage active participation of domestic cloud companies in the public and private cloud transition, a "Cloud Flagship Project" will be promoted to improve the quality and increase the number of cloud services. Similar to how global cloud companies form collaborative ecosystems by partnering with various cloud service companies to offer thousands of services, domestically, a leading group of companies centered on cloud infrastructure firms will cooperate with multiple cloud service companies to develop services by industry sector. Five sectors will be prioritized this year with 5 billion KRW each in support.

Through this, the goal is to develop world-class diverse cloud services usable in core industries and the public sector, and to form a cloud industry cooperative ecosystem centered on the leading group of companies.

Other measures in the development strategy include improving the environment for private cloud adoption in the public sector and establishing collaboration systems among companies, encompassing various cloud industry activation plans to realize a data and AI powerhouse.

The government expects that with the implementation of this development strategy, the number of companies with cloud sales exceeding 50 billion KRW will increase from 5 in 2019 to more than 10 in 2023, and the cloud adoption rate among businesses with 10 or more employees will expand from 22.7% to over 40%.

Minister Choi Ki-young of the Ministry of Science and ICT stated, "The Digital New Deal will be a catalyst for job creation and leading future changes, and cloud is the core infrastructure to complete this. Strengthening the competitiveness of the domestic cloud industry is crucial." He added, "Through this cloud industry development strategy, a turning point for digital transformation utilizing data and artificial intelligence across the public and industrial sectors will be established, and we hope the economy recovers rapidly."

This content was produced with the assistance of AI translation services.