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Telecom business alone is no longer lucrative, says SK Telecom CEO

Developing AI technologies — AI data centers, large language models and AI chips — are essential for the domestic telecommunications industry to survive and thrive in the future, according to SK Telecom CEO Ryu Young-sang on Tuesday.

“SK Telecom is working to integrate AI in all realms of business and establish the needed infrastructure,” Ryu said at an event dubbed “The future trajectory of ICT in the AI era” held at Yonsei University, western Seoul. “The company will aim to become a global market leader in the AI industry and pave the way for Korea to become an advanced nation in the realm.”

The event was co-organized by Yonsei University and Barun ICT Research Center, and sponsored by mobile carrier SK Telecom.

Other panelists invited to the roundtable event agreed that mobile carriers can no longer depend on the telecom business alone to survive.

“What is evident is that mobile carriers no longer consider the telecommunications business alone to be lucrative,” said economics professor Kwon Nam-hoon of Konkuk University. “The proportion of revenue the business represents for the three major mobile carriers is between 20 and 40 percent, and their major cash cows are unrelated to the telecom business.”

Kwon forecasts that the next killer application as revolutionary as Apple’s first smartphone will most likely arrive in the form of personal AI assistants, and telecom companies will play a key role.

“AI personal assistants will become the users’ avatar,” Kwon said. “They will come in the form of connected personal devices that users carry around, and when telecom companies provide that, it will be as revolutionary as the introduction of the iPhone.”

SK Telecom is considered to be at the forefront of the hyped technology among the three companies.

Ryu said last year that his firm aims to become a global AI company and generate annual revenue of 25 trillion won ($18.7 billion) from AI ventures by 2028.

He put a particular emphasis on the eventual evolution of A dot, SK’s Korean large language model and the name of its AI app, into a personal AI assistant, which he believes will become one of the most pursued realms of business in the AI era.

Experts were unanimous in the viewpoint that it will be difficult for Korean tech companies to directly compete against globally dominant players such as OpenAI and Google, but they can at least grow to the level where they can monitor global policies and become alternative solutions.

“Telecom policies on the integration of AI technology will be enforced under a universal set of rules that will be applied to all countries,” said Kim Kyung-man, head of telecommunications policy at the Ministry of Science and ICT. “It will be important for Korean companies to get their hands on imported technologies first and set up the physical infrastructure so that new services can instantly be applied domestically.”

With the advancement of AI, the metaverse will be back, according to Kwon.

“There is a desire among people to create a virtual self, an anonymous self-being on social media,” Kwon said. “AI will make this possible with a higher-dimensional being on the floor of the metaverse, and it will be another potential profit-making sector for telecom companies to enter.” Korea Joongang Daily

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