[Drifting Korean-style AI]⑥ "Niche Strategy Is the Solution to Capital Disadvantage... Focus on Securing Long-term Competitiveness"

Interview with Kim Myung-joo, President of the International Artificial Intelligence Ethics Association
"There will be demand as it can reflect national culture and language"
"Government should support in the form of a consortium, not specific companies"

Kim Myung-joo, President of the International Artificial Intelligence Ethics Association (Director of the Barun AI Research Center at Seoul Women's University)

"It is natural for countries with local cultures to take an active interest in artificial intelligence (AI) that reflects their unique characteristics. Sovereign AI can be a competitive strategy for Naver, which finds it difficult to directly compete with global big tech companies."

As the dominance of American big tech in the AI market becomes more pronounced, companies with relatively less capital, such as Naver, are seeking niche strategies. In a situation where enormous costs are invested in building AI models, they aim to overcome capital disadvantages by exploiting gaps. The plan is to build AI tailored to the language and culture of the countries adopting AI services and to focus more on localization to increase customers from other countries and enterprises.

Kim Myung-joo, Chairperson of the International Artificial Intelligence Ethics Association and Director of the Barun AI Research Center at Seoul Women’s University, said in a phone interview with Asia Economy on the 22nd, "There will be quite a few countries that want to introduce AI services reflecting their own opinions by cooperating with companies like Naver, as they do not have to rely on big tech." She added, "There is expected demand in Middle Eastern countries that have antipathy toward the U.S. and in regions with strong local cultures but less development, such as Asia and Africa."

Sovereign AI is described as a strategy through which Naver can reduce the size gap with global big tech. Chairperson Kim said, "Since we are physically different from OpenAI or Microsoft (MS), sovereign AI is the right policy approach," adding, "We cannot push out the top 1 to 3 AI models worldwide, but capturing minor groups that do not use these AIs is also meaningful."

She emphasizes that for the success of the sovereign AI strategy, the performance of Naver’s large language model (LLM), HyperCLOVA X, must be guaranteed. She said, "The most important factor in AI development is people, and the U.S. also values this," adding, "Having a lot of money does not necessarily mean you can secure good talent, so a long-term plan to nurture developers must also be prepared."

AI development companies like Naver are requesting support from the government and the nation for sovereign AI. In particular, they advocate for industrial promotion and government-led nurturing through the enactment of a basic AI law. Although six basic AI-related bills have been proposed since the 22nd National Assembly, they are currently pending in the National Assembly. Chairperson Kim stresses that sovereign AI should not be interpreted as support solely for Naver.

Kim said, "It is somewhat uncomfortable that Naver, not the government, is the one bringing up discussions related to sovereign AI," explaining, "Because it could be interpreted as asking the government to help Naver for sovereign AI." She continued, "If only Naver survives through the success of sovereign AI, it will become a domestic monopoly," and added, "It is important to create an ecosystem by supporting not only Naver but also other AI companies."

Chairperson Kim emphasizes that building a diverse AI ecosystem domestically will ultimately benefit Naver as well. She said, "There are limits to B2C (business-to-consumer) alone, but if the ecosystem expands and the B2B (business-to-business) sector grows, it will help everyone," advising, "The government should consider supporting AI companies not targeting specific companies but forming a consortium to assist them."