Ministry of Science and ICT to Foster Software-as-a-Service Industry

[Asia Economy Reporter Lim Hye-sun] The Ministry of Science and ICT announced on the 19th that, together with the National IT Industry Promotion Agency, it will launch the "Core Industry Cloud Flagship Project" from the 20th to develop and expand domestic Software as a Service (SaaS). The "Cloud Flagship Project" is a collaborative initiative between large and small-to-medium enterprises that supports the development and expansion of domestic cloud services through the linkage of cloud infrastructure companies and service companies.

As the global software usage paradigm shifts from a build-to-own model to a subscription-based cloud model, the importance of SaaS is increasing. However, the domestic software market is still centered on purchasing and building software, resulting in a shortage of SaaS. Among 25,118 domestic software companies, only about 780 are SaaS companies.

The Ministry of Science and ICT has been enhancing domestic cloud competitiveness by selecting core industries with high industrial impact through the flagship project and supporting service companies to develop excellent SaaS through cooperation between infrastructure companies and service companies in each sector.

This year, considering sector-specific achievements and market conditions, five support sectors were selected: Digital Work, Digital Health, Intelligent Logistics, Smart Manufacturing, and Environment & Energy. A total of 25 billion KRW will be invested to select and support 52 SaaS development, conversion, and advancement projects, including collaboration tools for business innovation and efficiency, non-face-to-face health management, and intelligent and automated production processes.

Infrastructure companies will support service companies by providing cloud infrastructure, development support tools, cloud technology support, consulting, marketing, and education to promote corporate growth. Service companies will promote the expansion of SaaS usage in promising industrial sectors by receiving support from infrastructure companies for converting existing on-premise software to SaaS, developing new SaaS, and advancing SaaS.

Since 2020, the Ministry of Science and ICT has supported the creation of 119 SaaS products in various promising industrial sectors through this project, helping to solve problems in the industrial field. Supported companies have recorded sales of 9.15 billion KRW so far.