SEOUL: SK Telecom says it plans to build a nationwide network of artificial intelligence (AI) data centres (DCs) in South Korea, betting that demand for AI computing power will continue to outstrip supply.

The project will begin in Ulsan, where the company is building its first AI DC.

SK Telecom plans to use the site as the base for a larger cluster across the Yeongnam region – which includes Busan, Ulsan and Daegu, and the North and South Gyeongsang provinces – with capacity eventually exceeding 2GW.

It also plans to build 1GW of capacity in the southwestern region.

The company aims to bring 5GW of AI DC capacity online in South Korea in phases from 2029 before expanding the total to 15GW by 2035.

The plan comes as companies around the world race to secure computing infrastructure for training and running large AI models, a market increasingly constrained by power, chips and available DC space.

SK Telecom said South Korea has several advantages in that race, including its high-bandwidth memory chip supply chain, access to nuclear and liquefied natural gas-based power, and experience operating large-scale semiconductor manufacturing facilities.

SK Group affiliates will take part in the project across chips, energy, construction and operations. SK Telecom will oversee the overall design, development and operation of the facilities.

The company has been expanding its AI infrastructure business through partnerships with Amazon Web Services (AWS) and Nvidia.

In Ulsan, SK Telecom is working with AWS on a hyperscale AI DC scheduled to begin operations in the second half of next year.

It is also considering expanding the site to more than 1GW over the longer term.

The company has also unveiled plans with Nvidia to operate an “AI factory”, a next-generation DC designed to handle advanced AI workloads.

SK Telecom said the DC buildout could help position South Korea as a major AI infrastructure hub in Asia, while also creating new growth opportunities for regions outside the Seoul metropolitan area.

“This AI DC project is aimed at preemptively preparing the computing infrastructure that the global AI ecosystem needs,” said SK Telecom chief executive officer Jung Jai-hun.

“We will work closely with the government, industry and local communities to help South Korea grow into Asia’s core AI infrastructure hub.” ­— The Korea Herald/ANN