Government Launches 'K-Cloud Project' in Full Swing to Boost AI Semiconductor and Cloud Competitiveness

The government is promoting the 'K-Cloud Project' in collaboration with the domestic AI semiconductor and cloud industries to respond to the era of generative AI. The plan is to develop world-class ultra-high-speed, low-power domestic AI semiconductors and apply them to data centers to strengthen the competitiveness of domestic cloud services.

On the 26th, Lee Jong-ho, Minister of Science and ICT, announced the launch of the first phase of the K-Cloud Project at the '3rd AI Semiconductor High-Level Strategic Dialogue' held at NHN Cloud headquarters in Pangyo, Seongnam, Gyeonggi Province.

This government policy comes as the importance of AI semiconductors has been highlighted due to the recent spread of AI based on large-scale language models. Global market research firm Gartner forecasts that the global AI semiconductor market will grow from $34.7 billion in 2021 to $86.1 billion in 2026, with an average annual growth rate of 16%. Consequently, global companies such as NVIDIA, AMD, Microsoft, Amazon, and Google are intensifying their competition in AI semiconductor development.

Accordingly, the government plans to advance domestic AI semiconductors in three stages and implement demonstration projects that apply them to data centers step-by-step, ultimately providing cloud-based AI services. The budget for this is approximately 826.2 billion KRW from this year through 2030.

First, by 2025, a total of 100 billion KRW will be invested to apply domestically produced neural processing units (NPUs), which are in the early stages of commercialization, to data centers and provide cloud-based AI services through demonstration projects. NPUs are high-performance, low-power processors optimized for AI algorithms such as deep learning.

The domestic NPU data center construction project consists of two sectors: private and public. The computing capacity of each data center has been doubled from the original plan, reaching a total scale of 39.9 petaflops (PF; 1 PF equals 1,000 trillion operations per second).

AI semiconductor companies participating include FuriosaAI, Rebellion, and Sapeon Korea, while cloud companies involved are Naver Cloud, KT Cloud, and NHN Cloud. AI service developers such as Upstage, Raonroad, Nota, SynergyAI, and Superb AI are also part of the consortium.

NHN Cloud will build an AI semiconductor-based data center with a scale of over 22 PF, accounting for more than 50% of this project. KT Cloud plans to create a data center and cloud platform with a total capacity of 8.9 PF and will demonstrate AI application services. The commercialization potential of KT’s large-scale AI, 'Mideum,' based on domestic AI semiconductors, will also be verified in connection with this project.

The government will also promote a preliminary feasibility study worth about 1 trillion KRW focusing on data center infrastructure and hardware development, data center computing software development, and AI semiconductor-specialized cloud technology development.

Minister Lee Jong-ho of the Ministry of Science and ICT stated, "Global companies are competing to create high-performance, low-power AI semiconductors optimized for AI computing," adding, "We will spare no support for technology development and training of experts necessary for the global market entry of domestic AI semiconductors."

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