# South Korea Faces AI Growth Challenges Amid GPU Shortage
South Korea stands as one of the leading nations in artificial intelligence (AI) development. However, the country grapples with a significant challenge: a shortage of computing power essential for AI industry growth. As demand for GPUs exceeds supply, South Korea’s semiconductor chip inventory plummeted by 33.7% in April 2024 compared to the previous year, marking the steepest decline since 2014. Amidst these issues, io.net has emerged as a vital alternative for Korean companies requiring computing resources for AI-based applications.
# Rapid Growth in the Korean AI Market
The South Korean AI market is expanding rapidly. According to Statista, the market size is projected to grow from $3.6 billion (approximately 4.8 trillion KRW) in 2024 to $14.7 billion (approximately 19.5 trillion KRW) by 2030. Particularly noteworthy is the generative AI market, which is expected to witness a tenfold increase, reaching $7.06 billion (approximately 9.4 trillion KRW). This impressive annual growth rate of 30% underscores the high potential of the Korean AI industry.
# Challenges Posed by the Semiconductor Shortage
However, the surging demand for AI applications exacerbates the semiconductor shortage, hindering industry growth. Some experts caution that if the GPU shortage persists, it may impede the realization of anticipated growth forecasts.
## Government-Driven AI Investment Expansion
To secure a leadership position in the AI industry, South Korea is making proactive government-led investments. As part of the “AI National Strategy” announced in 2019, the government plans to invest a total of 1.2 trillion KRW (approximately $900 million) to develop AI technologies and services by 2028. An additional 94.6 billion KRW (approximately $68.2 million) will be infused into the National AI Research Institute established in Seoul by 2028.
South Korea’s AI applications span various sectors, including B2B generative AI solutions, financial services, manufacturing automation, and consumer personalization. AI adoption is expanding across industries, with technologies excelling in natural language processing, computer vision, machine learning, and robotics.
## GPU Shortage: The Biggest Hurdle for AI Industry
The GPU shortage has become a significant obstacle for South Korea’s AI industry. The skyrocketing demand for GPUs has led to a doubling of NVIDIA AI accelerator prices, from 4 million KRW (approximately $3,000) at the beginning of the year to 8 million KRW (approximately $5,900). Moreover, securing a GPU now entails a waiting period of up to 52 weeks.
Due to the GPU supply crunch, significant companies like Naver are scrambling to find alternatives, switching from NVIDIA GPUs to Intel CPUs. These issues hinder companies’ AI development and implementation, further stifling industrial progress due to price hikes and intensified competition.
# io.net’s Solution to the GPU Shortage
To address the GPU shortage, io.net proposes a decentralized GPU network. io.net aggregates unused GPUs from independent data centers, crypto miners, and decentralized storage providers, enabling users to access computing resources without substantial hardware investments.
io.net supports various distributed tasks such as reinforcement learning, deep learning, model optimization, and AI workload processing. It provides services at 90% lower costs compared to traditional GPU purchasing models, allowing companies to scale resources as needed.
io.net’s adaptable resource supply structure naturally enhances GPU availability as demand increases, fostering a competitive environment that autonomously expands GPU supply. This decentralized GPU network is poised to become a critical component in the foundation of South Korea’s AI industry.
By mitigating the GPU shortage, io.net is expected to become a cornerstone of sustainable growth in the Korean AI industry.
