A bigger bet, a narrower target
The original competition promised 530 billion won, about $390 million, for five selected companies. The new plan is roughly nine times larger. That is a major increase, but it sits against a far bigger global spending backdrop: Google, Amazon, Microsoft and Meta plan to invest about $725 billion combined in 2026, mainly in AI data centers.
South Korea is also building up the infrastructure needed to support AI development. In October 2025, Samsung and SK signed an agreement with OpenAI to expand AI infrastructure in the country. In June, Samsung, SK Hynix and the government announced a $590 billion plan to increase chip production.
The missing test
South Korean consumers still mostly pay foreign providers for AI services. In December 2025, they spent more on ChatGPT and similar subscriptions than on Netflix.
I think that makes the new competition more than a model-building exercise: it is also a bet that a domestic contender can capture spending that currently goes abroad. But the announcement names a target—leading Chinese open models—not a measure of success for users or businesses. The harder question is whether the project can turn public funding and new computing capacity into a product people choose over foreign services.
Daily AI news
Every day we pick what actually matters in AI and explain it plainly — no hype, no filler. Subscribe if you want to follow where the industry is going.
Only what matters — every day
Follow on X