- In August 2025, the South Korean government will launch its largest-ever national AI initiative, investing ₩530 billion ($390 million) into five domestic companies: LG AI Research, SK Telecom, Naver Cloud, NC AI, and startup Upstage.
- Goal: To reduce reliance on foreign AI, ensure national security, control data, and build AI deeply integrated with Korean language and culture. Every six months, the government will evaluate progress, eliminate underperforming entities, and maintain funding for leading businesses until only two core pillars remain.
- LG AI Research: Developing Exaone 4.0 (32B parameters), combining language processing with reasoning capabilities. Strength: Access to real-world data in biomedicine, materials, and manufacturing. LG focuses on optimizing performance rather than endless scaling, building efficient specialized models, and leveraging data from APIs for improvement.
- SK Telecom: Launched A.X 4.0 (72B and 7B parameters), based on Alibaba’s open-source Qwen 2.5. A.X processes Korean 33% more efficiently than GPT-4o. Its AI service A. has reached 10 million users, integrated into telecommunications, ride-hailing, and customer service. SKT also collaborates with MIT and is developing South Korea’s largest GPUaaS infrastructure.
- Naver Cloud: Owns HyperCLOVA X, the AI chatbot CLOVA X, the search engine Cue (competing with Google and Bing), and the multimodal AI HyperCLOVA X Think. Strength: “Full-stack AI” – from chips, data centers, platforms, applications, to user services (shopping, maps, finance). Emphasizes fine-tuning rather than a race for scale.
- Upstage: The only startup, with Solar Pro 2 (31B parameters), ranked as a frontier model alongside OpenAI, Google, and Anthropic. Despite being smaller (compared to competitors’ 100-200B parameters), Solar Pro 2 excels in Korean benchmarks and is cost-effective. Upstage aims to build an indigenous AI ecosystem, specialized for finance, healthcare, and legal sectors.
- NC AI: Declined to comment but is part of the funded group, focusing on gaming and creative AI.
- 📌 Summary: In August 2025, the South Korean government will invest $390 million in five domestic companies (LG AI Research, SK Telecom, Naver Cloud, NC AI, and startup Upstage) to reduce reliance on foreign AI, ensure national security, control data, and build AI integrated with Korean language and culture. Every six months, progress will be evaluated, weaker players eliminated, and funding maintained for leaders until only two core companies remain. This approach, focused on performance, specialization, and real-world applications, promises to make South Korea a leading AI hub in Asia.
© 2025 Vietmetric