SK Hyper Seeks $350 Billion to Fund First 5GW Phase of 15GW AI Data Center Plan in South Korea

SK Hyper, the artificial intelligence data center arm of SK Telecom, is seeking approximately $350 billion (463 trillion won) in funding to build 15 gigawatts of data center capacity in South Korea, according to a strategy outlined by CEO Chung Suk-keun on Bloomberg TV's technology program "Bloomberg Tech: Asia." The plan aims to draw global companies' AI infrastructure into South Korea and capture AI computing demand from elsewhere in Asia, including Japan and Taiwan, positioning the country as a global AI infrastructure hub. The initiative reflects a broader industry shift in which AI infrastructure is increasingly viewed as a strategic national asset, with countries and companies seeking to reduce reliance on overseas-developed AI models and platforms.

SK Hyper is in talks with global hyperscalers about bringing AI inference hubs to South Korea and also aims to attract the large-scale computing infrastructure needed to train AI models. "For the first 5GW project, we don't expect much difficulty securing power and sites," Chung said. "Securing actual demand in the global market and raising the capital needed to build the data centers will be the biggest challenges." He added that the company needs to secure not only domestic sovereign AI and enterprise AI demand but also demand from other Asian countries such as Japan and Taiwan, and that discussions with hyperscalers are underway to bring inference hubs to Korea while also attracting training computing infrastructure.

The strategy reflects a judgment that domestic demand alone cannot make large-scale data centers commercially viable. "Korea's data center market is currently about 1GW in size," Chung said. "Given the scale of the domestic IT industry, Korea has not been an attractive location in the global data center industry until now." The initial 5GW that SK Hyper is pursuing is roughly five times the domestic data center market Chung cited, making global customers central to the project. According to Bloomberg, Chung said the company could begin generating revenue as early as next year, ahead of 2029, when the first data centers are scheduled for completion.

On the financing side, SK Hyper plans to build a total of 15GW of data center capacity in South Korea by 2035, and it estimates the initial 5GW phase alone will require about $350 billion, including the cost of servers and other equipment. The company is discussing financing options with global big tech companies and financial investors, aiming to attract its first outside investment late this year or early next year. It plans to raise additional funds over the following three to four years and to share the total project cost with data center customers and outside investors. SK Telecom previously announced it would invest up to 750 billion won in SK Hyper in stages through 2030.

Chung stressed that actual computing demand in the industry remains firm despite the recent pullback in AI infrastructure stocks and weaker investor sentiment. "There is a lot of uncertainty in the capital markets, but AI model developers and service providers can feel customer demand rising sharply," he said. "Rather than waiting for real demand to materialize, we need to prepare in advance so we can respond to market demand." Still, the company plans to manage risk by communicating closely with big tech firms and hyperscalers to confirm demand before investing and by adjusting its business plans accordingly.

SK Hyper's strategy is to combine SK Group's semiconductor, energy and telecommunications capabilities to compete in the global AI infrastructure market. "Until last year, the key competitive edge was who had secured the most graphics processing units," Chung said. "Now what matters is who can generate tokens at the lowest cost and achieve the highest efficiency." Chung also emphasized the need for AI infrastructure at the national level, noting that many countries and companies are worried about relying solely on specific AI models developed overseas and need not only their own AI models but also sovereign AI infrastructure they can control directly at home — a trend he expects to spread to other countries.

SK Hyper plans to build a data center cluster of more than 2GW in the Yeongnam region, starting with its AI data center in Ulsan, and to add gigawatt-scale facilities in the Chungcheong and southwestern regions. It will begin phased operations in 2029 to reach the initial 5GW, then expand to 15GW by 2035 depending on global customer demand.