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Photo = Yonhap news |
[Alpha Biz= Paul Lee] South Korea’s major tech companies are significantly trailing their U.S. counterparts in terms of investment relative to revenue, especially in the field of artificial intelligence (AI), according to a recent report.
A study released Friday by the Korea Institute of Finance (KIF) on AI industry investment and the role of capital markets revealed that as of the fourth quarter of 2023, AI-related investments accounted for just 7.2% of revenue at Naver and a mere 3.6% at Kakao. This means that for every KRW 1 million in revenue, Kakao invests only KRW 36,000 into AI.
In stark contrast, U.S. tech giants far outpaced their Korean peers: Meta reinvested 77% of its revenue, Google 54.5%, and Amazon 44.2% during the same period.
Senior researcher Lee Ji-eon of KIF noted that South Korea’s AI sector is lagging behind global leaders, citing low investment levels as a key reason. “One of the primary factors behind Korea’s delayed progress in AI is insufficient investment,” Lee said.
To close the gap, the report recommends increasing infrastructure investments and establishing stronger financial support mechanisms to encourage AI development and innovation.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
