SK Hyper Seeks $350B for First 5GW of Korea AI Data Center Plan
3 min readSK Hyper, the AI data center arm of SK Telecom, is seeking roughly $350 billion, about 464 trillion won, to build the first 5 gigawatts of a plan that would give South Korea 15GW of AI data center capacity by 2035. CEO Chung Suk-keun laid out the strategy on Bloomberg TV on Friday, saying the company is already in talks with global big tech companies and financial investors.
SK Hyper Wants Five Times the Domestic Market
SK Hyper was carved out of SK Telecom as a subsidiary in July 2026, with the parent pledging up to 750 billion won in staged contributions through 2030. That money is small next to the first phase. Chung said Korea’s entire data center market today is about 1GW, so the initial 5GW alone would be roughly five times the country’s existing footprint, with servers and equipment included in the estimate.
The build centers on a cluster of more than 2GW in the Yeongnam region, starting with the Ulsan AI data center, plus gigawatt-scale sites in the Chungcheong and southwestern regions. SK Hyper is consulting the government on additional sites and said it does not expect much difficulty securing power and land for the first 5GW.
Who Pays and When
SK Group does not intend to fund the project alone. The structure, as reported by Seoul Economic Daily and MoneyToday, shares total costs between the customers moving into the data centers and outside investors. The first external funding is targeted for late 2026 or early 2027, with further rounds over the following three to four years.
Operations begin in phases from 2029, but Chung said revenue could start as early as next year. Target customers include global hyperscalers looking to place AI inference hubs in Korea, large training clusters, domestic sovereign and enterprise AI demand, and spillover from Japan and Taiwan. SK Hyper is also weighing packaged compute and models for governments in Asia and the Middle East.
Why It Matters
Korea has never been a magnet for global data center investment, something Chung attributed to the modest size of its domestic IT industry. Electricity is also relatively expensive. SK Group’s pitch is that combining the efficiency technologies of its semiconductor, energy, and telecom affiliates can offset that power disadvantage. The winner, in Chung’s words, will be whoever can generate tokens at the lowest cost.
The timing is awkward. The plan surfaced on the same day the KOSPI opened down more than 2 percent and Samsung and SK hynix shares slid after a 6.7 percent drop in the Philadelphia Semiconductor Index. Chung acknowledged that capital markets are uncertain after the pullback in AI infrastructure stocks and said SK Hyper will confirm demand with hyperscalers before each tranche is spent, scaling the plan to match. A $350 billion ambition paced to real orders is a very different bet from one built on hope.