S.Korea aims to join AI race as startup Rebellions launches new chip

SK Telecom Co

12/02/2023 22:00

By Jane Lanhee Lee and Joyce Lee
       SEOUL Feb 13 (Reuters) - South Korean startup Rebellions
Inc launches an artificial intelligence (AI) chip on Monday,
racing to win government contracts as Seoul seeks a place for
local companies in the exploding AI industry.
    The company's ATOM chip is the latest Korean attempt to
challenge global leader Nvidia Corp  NVDA.O  in the hardware
that powers the potentially revolutionary AI technology.
    AI is the talk of the tech world, as ChatGPT - a chatbot
from Microsoft-backed  MSFT.O  OpenAI that generates articles,
essays, jokes and even poetry - has become the fastest-growing
consumer app in history just two months after launch, according
to UBS.
    Nvidia, a U.S. chip designer, has a commanding share of
high-end AI chips, making up about 86% of the computing power of
the world’s six biggest cloud services as of December, according
to Jefferies chip analyst Mark Lipacis.
    The South Korean government wants to foster a domestic
industry, investing more than $800 million over the next five
years for research and development in a bid to lift the market
share of Korean AI chips in domestic data centres from
essentially zero to 80% by 2030.
    "It’s hard to catch up to Nvidia, which is so far ahead in
general-purpose AI chips," said Kim Yang-Paeng, senior
researcher at the Korea Institute for Industrial Economics and
Trade. "But it's not set in stone because AI chips can carry out
different functions and there aren't set boundaries or metrics."
    Rebellions' ATOM is designed to excel at running computer
vision and chatbot AI applications. Because it targets specific
tasks rather than doing a wide range, the chip consumes only
about 20% of the power of an Nvidia A100 chip on those tasks,
said Rebellions co-founder and chief executive Park Sunghyun.
    A100 is the most popular chip for AI workloads, powerful
enough to create - in industry lingo, "train" - the AI models.
ATOM, designed by Rebellions and manufactured by Korean giant
Samsung Electronics Co  005930.KS , does not do training.
    While countries such as Taiwan, China, France, Germany and
the United States have extensive plans to support their
semiconductor companies, the South Korean government is rare in
singling out AI chips for a concentrated push. 
    Seoul will put out a notice this month for two data centres,
called neural processing unit farms, with only domestic
chipmakers allowed to bid, an official at the Ministry of
Science and ICT told Reuters.
    'TWISTING ARMS'
    In a country whose firms supply half the world's memory
chips, the authorities want to create a market that can be a
test bed for AI chipmakers, aiming to foster global competitors.
    "The government is twisting the arm of the data centres and
telling them, 'Hey, use these chips'," Rebellions' Park, a
former Morgan Stanley engineer, told Reuters.
    Without such support, he said, data centres and their
customers would likely stick with Nvidia chips.    
    Sapeon Korea Inc also plans to participate in the project,
the SK Telecom Co  017670.KS  subsidiary said.
    FuriosaAI, backed by South Korea's top search engine Naver
Corp  035420.KS  and state-run Korea Development Bank  KDB.UL ,
told Reuters it will also bid.
    "There's a lot of momentum behind Nvidia's developments.
These startups have got to build momentum, so that will take
time," said Alan Priestley, an analyst at IT research firm
Gartner. "But government incentives such as what's happening in
Korea could well affect the market share within Korea."
    Rebellions will seek to participate in the government
project in a consortium with KT Corp  030200.KS , a big Korean
telecom, cloud and data centre operator, in the hopes of weaning
Nvidia customers off the U.S. supplier.
    "Amid high dependence on foreign GPUs (graphics processing
units) globally, the cooperation between KT and Rebellions will
allow us to have an 'AI full stack' that encompasses software
and hardware based on domestic technology,” said KT vice
president Bae Han-chul.
    Rebellions declined to give a forecast for its AI chip
venture. It has raised 122 billion won ($96 million), including
30 billion won from KT in a funding round joined by Singapore's
Temasek Pavilion Capital and 10 billion won grant from the South
Korean government.
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EXPLAINER-ChatGPT - what is OpenAI’s chatbot and what is it used
for?    https://www.reuters.com/technology/chatgpt-what-is-openais-chatbot-what-is-it-used-2022-12-05/
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 (Reporting By Jane Lanhee Lee in Oakland, Calif., and Joyce Lee
in Seoul; Editing by Miyoung Kim and William Mallard)
 ((jane.lee@thomsonreuters.com; +1-415-344-3912; Reuters
Messaging: jane.lee.thomsonreuters@reuters.net))