Google has decided to build a data center in Korea this year and is discussing ways to partner with domestic mobile carrier LG Uplus. Google, which had been cautious about building its own data center in Korea, has shifted toward investing in domestic infrastructure.
According to reporting by ChosunBiz on the 5th, Google internally decided to build a data center in Korea to use high-precision Korean map data and to advance its cloud and artificial intelligence (AI) services. Talks are underway with LG Uplus over specific partnership models and terms. The DBO (Design, Build, Operate) model, under which LG Uplus would handle end-to-end design, construction, and operation of the data center, is seen as the leading option. DBO is a structure in which the client outsources not only design and construction but also operation to an external operator.
Google operates data centers in three Asian countries—Japan, Taiwan, and Singapore—and is pushing to build new data centers in Thailand, India, and Malaysia. Industry watchers say that if a Korean site is added, it would be the seventh data center in Asia. An industry official said, "To deliver large-scale services from generative AI like Gemini, YouTube search and ads, and Google Cloud with low latency, a local data center is essential," adding, "Google building a data center in the country is a clear message that it sees Korea as a core infrastructure hub in Northeast Asia."
Google's push for a data center in Korea is seen as aligning with the government's shift in policy on high-precision map data. The government has emphasized masking security facilities such as military bases and the need to manage key data domestically. The logic is that expanding the use of map data requires a foundation that allows data processing and security measures to be carried out within the country. Google is accepting the construction of a data center in Korea and seeking a solution that meets the government's requirements.
If the talks succeed, observers say LG Uplus could strengthen its position beyond a telecom operator to an AI infrastructure provider. On the 13th of last month, LG Uplus held a board meeting and passed an agenda item to add investments and grants related to the data center DBO business to its articles of incorporation as a new business purpose. In the industry, the change to the articles was widely interpreted as preparatory work ahead of a major contract. LG Uplus currently operates seven in-house internet data centers (IDC).
Inside and outside the industry, the view is that if Google builds a data center in Korea, the investment will be in the trillion-won range. In 2024, Google released plans in Thailand to build data center and cloud infrastructure and disclosed a $1 billion (about 1.4725 trillion won) investment, and in the same year proposed $2 billion (about 2.9454 trillion won) in Malaysia. In India, it announced a $15 billion (about 22 trillion won) investment plan last year.
However, variables remain before a final contract. Final-stage negotiations are said to be continuing over site selection and scope of design, operational responsibilities and security requirements, and pricing terms. A person familiar with LG Uplus said, "The final contract is not yet set. It is true that we are discussing pricing terms with Google." A Google representative said, "It is difficult to confirm the details."