South Korea is to add a new artificial intelligence (AI) chip to its arsenal of semiconductors as the nation seeks a bigger slice of the global technology market and an upgrade of its industrial capabilities.
The Sapeon X220, unveiled by the country’s largest carrier SK Telecom Co, is designed to speed up servers that cater to a growing number of mobile devices — from drones to self-driving vehicles — that perform better with AI.
It is the latest product of the nation’s decade-long push to broaden its dominance beyond memory chips, where Samsung Electronics Co and SK Hynix Inc control about two-thirds of the global market.
Seoul sees data-processing chips as a major engine for economic growth, along with 5G wireless networks.
The government has provided more than 600 billion won (US$542. million) in support to develop the chips and plans to invest another 1 trillion won over the next decade, viewing them as crucial in automating factories and improving the competitiveness of the country’s exports.
“As we teamed up with the government, we said: ‘Let’s make AI available and affordable for all of our companies,’” SK Telecom vice president Lee Jong-min said. “South Korea has the demand, the full stack of tech needed to meet the demand, and the ability to take it to the next level.”
Semiconductors account for about one-fifth of South Korea’s exports, most of them memory chips.
The country is now turning to application-specific integrated circuits (ASICs), such as the X220, which is tailored for AI operations.
It follows a similar US$1 billion investment plan announced by the US government earlier this year, which also emphasized AI and public-private collaboration.
As the first country in the world to roll out commercial 5G last year, South Korea believes that it can also lead in adopting and optimizing AI, aided by the nation’s compact size, wide broadband coverage and smartphone penetration.
However, competition is heating up in the AI semiconductor sector, with the likes of Amazon.com Inc and Google holding company Alphabet Inc investing in their own bespoke server silicon.
As more devices than ever come online, companies are betting that they can unlock value and insights from the resulting trove of data through machine learning and analysis at scale.
Like SK Telecom, US competitors offer cloud services to other companies, and the investment in designing the chips makes sense when factoring in the cost of electricity and the chips’ ability to handle greater volumes of data more efficiently.
SK Telecom’s chip, at the size of a postage stamp, is the first South Korean ASIC for data centers to be commercialized, the company said.
It represents the latest push by the Seoul-based carrier to expand beyond its traditional mobile and broadband businesses, and keep up in an era of AI-driven innovation.
The global AI chip market is led by Nvidia Corp, a graphics-card giant whose market value has eclipsed that of Intel Corp.
Even smartphone processors from the likes of Apple Inc and Huawei Technologies Co (華為) now come with dedicated cores for handling AI tasks, and the need for more ASICs is forecast to rise as AI gains more ground in global technology.