| KT executives and government officials take a celebratory picture during the launch of the KT Yongsan IDC in November last year. / Courtesy of KT |
By Kim Hyun-bin
Korea's major cloud services companies, KT, Naver, and NHN, are doubling down on the sector anticipating growth.
These companies plan to expand their cloud businesses through specialized solutions and data center infrastructure both in Korea and overseas. Their cloud services are backed by an abundant supply of clients in the financial and public sectors.
In 2011, the country's largest telecom company, KT, was the first to launch cloud services dubbed “Ucloud biz,” since renamed “KT Cloud.” The company plans to expedite its digital transformation based on its cloud business, through which it expects to provide services based on artificial intelligence (AI), internet of things (IoT) and big data.
KT's strengths come from its Internet Data Center (IDC) whose sales have grown 20 percent annually. Currently, sales stand at 100 billion won, but KT expects this figure to double each year to 1 trillion won by the end of 2023. Currently, KT operates five cloud data centers including one in Cheonan and another in Los Angeles, and has over 7,000 clients from the finance and public sectors.
“We are the only firm in the country that has all the infrastructure to operate data centers, networks and cloud services and we plan to continue offering differentiated services to maintain our leading position in the market,” a KT official said. “Currently we are generating 400 billion won in cloud sales, but considering our infrastructure, we aim to achieve 1 trillion won by 2023.”
Through the IDC, KT plans to further develop hybrid clouds and data as a service (Daas) as well as expanding into smart factories and fintech services.
NHN recently renamed its cloud affiliate Toast to NHN Cloud and aims to increase revenue from the business to 1 trillion won by 2025, a significant jump compared to 150 billion won last year.
NHN launched Toast in 2014 providing the country's first open stack based public cloud services, and currently the company operates 116 cloud infrastructure and platform products with 3,000 corporate clients including KB Financial and HDC.
NHN plans to tap into the U.S. market through the recent acquisition of Cloudnexa, a premier partner of Amazon Web Services (AWS).
The company launched its cloud regional services in the U.S. in August of 2019 and in Japan in March of the same year, growing to become one of AWS' top five managed service partners (MSP). It also plans to establish such services in Southeast Asian countries including Indonesia and Vietnam.
Naver, which also launched cloud services in 2017, now offers 177 products in six regions including Japan, Singapore and the U.S. as well as 10 global bases. The company generated 273 billion won in sales last year, with its cloud platform sales increasing 163 percent due to remote services that were offered to large companies such as Samsung Electronics and SK Telecom amid surging demand for data during the coronavirus pandemic.
The three companies have been expanding their data center infrastructure.
KT's newly-launched Yongsan IDC is capable of operating over 100,000 servers and connects directly to AWS and Google's cloud services.
Naver plans to complete construction of its Chuncheon data center, and is building a second in Sejong. NHN plans to build a data center that is four times the size of its existing Pangyo center and is also constructing an AI data center in Gwangju, South Jeolla Province.