While the United States and China are strengthening their artificial intelligence (AI) capabilities with the government’s full support, increased regulation in South Korea creates growing uncertainties for AI companies.
According to the IT industry on Monday, South Korea is globally considered a second-tier nation in AI technology.
The Boston Consulting Group (BCG) recently evaluated 73 countries in the AI Maturity Matrix report, which classified the United States and China as “AI Pioneers” and South Korea, Japan, Malaysia, and Taiwan as “AI Steady Contenders.”
The Platform Act of the Fair Trade Commission and Politicians Might Be a Potential Roadblock for AI Companies’ Growth
Platform regulations promoted by the Fair Trade Commission and politicians could significantly hinder the progress of Korean AI companies, which are already behind.
The Fair Trade Commission has proposed amending the Fair Trade Act to regulate major platform companies such as Naver, Kakao, and Google.
The Democratic Party of Korea has introduced the “Online Platform Fairness Act,” advocating for even stronger regulations that preemptively target specific companies.
If these platform regulations take effect, major platforms and AI startups collaborating with them could be subject to regulation.
AI services rely heavily on data accumulation and platform integration, raising concerns that these preemptive regulations will create barriers to market entry for emerging AI companies.
U.S. USTR Warns: Korean Platform Regulations May Trigger Trade Retaliation
Some experts warn that South Korea’s platform regulations could spark trade tensions with the U.S.
Jamieson Greer, nominated as the United States trade representative (USTR) in the second Trump administration, has expressed strong concerns over South Korea’s moves to regulate platforms.
He cautioned that if South Korea implements regulations undermining U.S. platform companies’ interests, the U.S. might take retaliatory measures.
Trade friction with the U.S. poses a significant risk, mainly because it could disrupt the supply of GPUs, which are crucial for maintaining AI competitiveness.
The Ministry of Science and ICT of Korea aims to secure 30,000 GPUs by 2030 to strengthen domestic AI competitiveness, with plans to acquire 15,000 this year.
Suppose trade disputes with the U.S. hinder South Korea’s ability to receive adequate supplies from NVIDIA, which dominates 90% of the global GPU market. In that case, these ambitious plans may be challenging to realize.
This situation underscores the need for policy coordination and collaboration among government agencies. While the Ministry of Science and ICT is pushing to expand GPU support to nurture AI companies, intensified regulations promoted by the Fair Trade Commission and politicians could significantly undermine efforts to strengthen AI competitiveness.
An IT industry insider commented, “While the AI competition evolves into a technological hegemony contest among nations, South Korea still seems stuck in regulatory discussions. The Fair Trade Commission needs to shift its approach towards policies that support the growth of the AI industry.”