South Korean tech giants commit over $550B to ease ‘ RAMageddon’ - BERITAJA

The world’s 2 largest representation spot companies scheme to put $518 cardinal (~800 trillion won) to build 4 caller representation fabs successful southwestern South Korea, a region that has historically attracted small semiconductor investment.

The announcement is portion of the country’s sweeping nationalist finance scheme spanning semiconductors, AI information centers, and beingness AI, which was unveiled astatine a statesmanlike briefing connected Monday, pinch the chairmen of Samsung and SK Hynix successful attendance. The scheme breaks down into 3 buckets. In the representation spot bucket is $518 cardinal for 4 caller representation fabs successful the southwest, positive $52 cardinal for an HBM (high bandwidth memory) packaging hub successful the cardinal region. Then there’s different $356 cardinal (550 trillion won) for AI information centers to beryllium built by Korean tech and power behemoths specified arsenic SK, GS and Naver done 2035.

All told, South Korean tech companies person committed to walk complete $900 cardinal connected AI and the demands for chips it is creating. With this, the federation hopes to catapult itself into becoming much of an AI powerfulness subordinate than it already is. Currently, Samsung and SK Hynix (along pinch U.S. representation spot shaper Micron) are each enjoying grounds request from what’s been called RAMageddon, a worldwide shortage of representation chips caused by the AI buildout.

“Semiconductors, beingness AI, and AI information centers are the triple axis for South Korea’s adjacent business era,” President Jae Myung Lee said in a televised address Monday, calling 2026 the twelvemonth South Korea must found itself arsenic an “irreplaceable” business power.

Lee said existing spot accommodation successful Yongin and Pyeongtaek, the bosom of South Korea’s semiconductor loop conscionable southbound of Seoul, person “already reached their limits,” and urged companies to accelerate finance successful the southwest, hoping to spreading the AI wealthiness beyond the nation’s capital. “We must unafraid overwhelming accumulation capacity successful advance,” he said.

Yet, Lee pushed backmost against media reports that the authorities had pressured companies into the investments, reportedly saying the decisions reflected the companies’ ain judgment. “The government’s domiciled is to put its capabilities truthful that companies could put without losses and pinch amended prospects,” he was quoted arsenic saying.

Samsung separately published a property merchandise Monday, announcing plans to put 2,655 trillion won (~$1.7 trillion) complete the adjacent decade, pinch 425 trillion won earmarked for the Honam region, the southwestern area of the Korean peninsula. The institution cited expected incentives about power, water, workforce, and surviving conditions arsenic cardinal factors successful selecting Gwangju, about 300 kilometers southbound of Seoul, for a caller semiconductor fab, alongside an AI information halfway successful Haenam, astatine the confederate extremity of the peninsula.

That is not an outlandish sum compared to U.S. tech giants Alphabet, Amazon, Meta, and Microsoft, who will collectively walk $650 cardinal connected AI infrastructure this twelvemonth alone, according to Reuters.

Meanwhile, SK Group announced a 2,100 trillion won (~$1.4 trillion) medium-to-long word finance roadmap, 1,100 trillion won to grow semiconductor accumulation capacity and 1,000 trillion won for AI information centers nationwide. SK Hynix, the group’s halfway semiconductor affiliate, is cardinal to the spot description push, while SK Telecom will lead the buildout of 15 gigawatts of AI information halfway capacity crossed the country.

Whether the ambition translates into execution is different question. Deep tech industries for illustration semiconductors and AI don’t move connected governmental aliases moreover customer request timelines. Fabs return years to build and the consequence is that, by the clip they are ready, the request that caused them will person ebbed, leaving companies pinch oversupply and crashing prices. For now, the world’s AI spot proviso chain, particularly those quiet for each things memory, will beryllium watching to spot if South Korea could propulsion it off.