South Korea launches a $3.5 billion frontier AI initiative to address strategic cybersecurity concerns.

The frontier program is planned as an equity investment, rather than simply a grant: the government expects to combine public investment with private funding, with any returns ultimately shared with the public.
The existing foundation-model competition has narrowed to three teams—SK Telecom, LG AI Research Institute and Upstage—with two to be selected in the final round.
The ministry is considering incentives for the two finalists in recognition of the resources they have invested, while saying those incentives should not distort how public funding is allocated.
South Korea will invest 4.7 trillion won ($3.5 billion) in a new frontier AI program set to launch in March 2027, Yahoo News reported. The push aims to develop cutting-edge artificial intelligence that can compete globally, while the government also continues its existing foundation-model competition among three Korean teams.
Unlike a typical government grant, the frontier program will use equity investment. The government expects to combine public money with private funding, and any profits will be shared with taxpayers. Yahoo News reports the Ministry of Science and ICT will pick a lead developer through an open selection process.
South Korea's existing AI foundation-model competition has narrowed to SK Telecom, LG AI Research Institute, and Upstage, Yahoo News stated. The government will select two winners in the final round. Officials are weighing financial incentives for the finalists to recognize their investment in the race.
South Korea's new frontier AI effort responds to recent breakthroughs by global competitors like Anthropic's advanced models, Yahoo News reported. The program targets strategic and cybersecurity concerns that the government views as critical gaps. The 2027 start date allows time for budget approval and planning.
The government will use an open selection process for the frontier program's lead developer, Yahoo News said. Eligible participants include private companies, startups, universities, or a special-purpose vehicle created for the effort. This approach aims to draw the widest possible talent pool.
Beyond building new models, the Ministry of Science and ICT is considering incentives to deploy Korean AI models across industry sectors, Yahoo News reported. This signals a shift in strategy: the government may prioritize getting homegrown models into practical use rather than just funding development.
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