Lee Byung-chul’s interest in semiconductors was exceptional.
February 1983. After the Tokyo Declaration, Hoam Electronics launched its first DRAM production plant in Giheung. At the time, engineers had come to Korea to build the factory, and Lee Byung-chul is said to have flown into a rage, shouting, “How could you put all the engineers on one plane when you don’t know what might happen?”
In truth, this isn’t an official story. But Lee Byung-chul’s obsession with semiconductors was that intense.
In fact, he had been showing signs of madness for ten years already.
In 1974, Hoam bought up as much as 50% of Korea Semiconductor, which was then suffering from severe management difficulties. Naturally, there was fierce opposition within the company.
At the time, the semiconductor market was dominated overwhelmingly by the G2—Japan and the United States—and no matter how much they crunched the numbers, it seemed impossible for Korean semiconductors to surpass them.
Nevertheless, five years later, Lee Byung-chul acquired the remaining 50% stake in Korea Semiconductor as well, outright merging the company.
But the world is no fairy tale.
Thanks to Lee Byung-chul’s fervent support, Korea’s semiconductor industry rose into the global top ten, but at the time, even the top ten in the semiconductor market were running deficits.
Hoam Semiconductor became an unprecedented white-elephant business, posting losses for thirteen consecutive years, and Chairman Lee Byung-chul passed away without ever seeing semiconductors turn a profit.
But one year after his death, Hoam Semiconductor recorded its first-ever profit, and the scale of it was enough to make up for all the losses until then. And now, it has become the core business of Hoam Electronics—no, of the Republic of Korea.
—Next in the news. With the Ministry of Science and ICT announcing the largest AI investment in history, totaling 50 trillion won, the selection of operators begins today. (Omitted) This public recruitment of operators will involve not only public-private evaluations, but also pension funds...
I watched the news with a bitter smile.
The current AI gap in Korea is as far behind as the semiconductor gap was back then. At the time, Hoam Electronics chased the technology gap by acquiring semiconductor businesses that were on the verge of collapse, but in the AI market, there aren’t even any failing companies to buy. From start to finish, we have to raise everything with our own hands.
Still, what’s fortunate is that back then, Korea was a wasteland with neither talent nor technology, while now, investment funds and infrastructure are in place to some extent.
“...”
In truth, I have no memory of Korea becoming an AI powerhouse, but I know very well what happens to domestic industry if we fail to make it happen.
—Ladies and gentlemen. Welcome to San Francisco...
As I was lost in various thoughts, the plane arrived at San Francisco Airport.
I hurriedly picked up my phone.
Like Chairman Lee Byung-chul, I intend to look twenty years ahead.
If I want to see Korea turn a profit with AI before I die, I have to hurry.
*
Pangyo, Bundang-gu, Seongnam City.
Lee Jong-chan, chairman and CEO of NAVE, looked out the window. With all the company executives gathered, the news continued to pour out reports about AI.
The executives’ faces were not bright.
Korea is a country where change comes too quickly. The smartphone was developed in the United States, yet Korea distributed it domestically at an even faster pace than the U.S.
In other words, this meant a crisis for NAVE.
After GPT announced its paid subscription, Korea once again recorded the highest subscription rate per capita. From now on, questions that would have gone to “Knowledge iN” would go to GPT instead.
Amid all this, Goggle was even supporting Gemini as a free service, once again aiming for domestic search engine market share. The company’s executives predicted that within five years, NAVE’s search share would be overtaken by Goggle.
“Is that true?”
At Chairman Lee’s question, a man in the company answered.
“Yes, that’s correct. The government is said to be making an investment of roughly 50 trillion won in cooperation with pension funds.”
“What method?”
“They will select five companies, conduct evaluations by the Ministry of Science and ICT every six months, and eliminate one company at a time.”
The government’s selection of operators was reminiscent of a survival audition.
They would select five promising operators, eliminate one every six months, and choose the final two companies. In other words, that meant stock prices would fluctuate every six months from now on.
“Then surviving among those five will be harder than being selected for the top five, won’t it?”
“That’s correct.”
Chairman Lee sighed.
“What do you all think?”
“Of course we should participate...”
“Participation goes without saying. I’m asking what strategy we should approach with so that, among all the major conglomerates that will rush in, we can be selected as one of the final two.”
No sooner had he finished speaking than every gaze turned toward the CTO.
The CTO opened his mouth.
“We must make good use of our strengths. The search big data we possess is a unique advantage no other company has. Goggle’s Gemini also entered the AI market on the foundation of such search engine data. We, too, will appeal to the government that with this model, we have stronger advantages than any other operator.”
“Then passing the preliminary round won’t be a problem?”
“...Pardon?”
“I’m asking whether there will be no problem getting into the five companies.”
“Ah, yes. Of course there won’t be a problem. We will make it happen without fail.”
The executives’ faces stiffened.
NAVE’s stock price was truly at its worst. In these times, when the KOSPI had risen 50%, it had only climbed around 10%. Even that was half of its peak.
In such a situation, if they failed even to pass the preliminary round, there would be no future for the company.
“Good. No matter how massive an investment the government makes, in the end, they will look at our sincerity. CFO?”
“Yes, Chairman.”
“Liquidate our retained earnings and unprofitable subsidiaries, and invest everything into AI.”
“Do you mean restructuring...?”
“Isn’t that obvious? Government investment on the scale of 50 trillion won doesn’t come around anytime. In effect, what will feed us for the next twenty years depends entirely on this.”
“Ah, yes...”
“Make it clear that the company will offer full support. If we are eliminated from this project—”
Chairman Lee’s voice trembled thinly.
“We die. The executives here will be restructured as well.”
*
At the same time, at CN Soft.
The executives of the nation’s top game company also gathered in one place with dark expressions.
When the news about the government’s 50-trillion-won investment plan ended, one person opened his mouth.
“This makes no sense, Chairman! Why would a game company like ours suddenly jump into the AI business out of nowhere?”
CN Soft was in a worse position than NAVE. In this era when the KOSPI had risen by 50%, its stock price was barely holding firm, and compared to its peak, it had fallen to a quarter.
“ If we have that kind of money, it would be right to invest more in Raniji!”
Was that why?
Unlike NAVE, which wanted to stake its life on this, the executives here were extremely negative about this government project. Raniji’s sales were already not what they used to be, and they had even carried out large-scale restructuring, so they couldn’t help but oppose participating in some unrelated business.
As the executives passionately voiced their objections, CEO Park Chan-yong asked.
“Director Kim, do you have that little hope in Raniji?”
“Of course not! We have staked our survival on this patch!”
“What patch is that...”
“Recently, the inflation surrounding the ‘Execution Sword’ has become too severe, so with this patch, we have decided to renew the ‘Ssaulabi Sword.’”
“The Ssaulabi Sword is... one of our old items, isn’t it?”
“It’s completely different. The item we will release this time is the ‘Absolute Ssaulabi Sword,’ and its specs are twice as good as the current Execution Sword. Once it’s released, the user response will likely be considerable. In line with the patch, we also intend to carry out an ‘Aden 10x Event.’ Then our company’s sales will improve tenfold as well!”
In truth, CN Soft’s Raniji was not a simple RPG game. It was a game of social philosophy containing the future and present of Korean society.
The more stagnant the established generation became—the old game users—the more the value of in-game currency collapsed, and this became an obstacle preventing new users from entering. Because of that, the developer would hold events with better items and better rewards, but this only accelerated the rich-get-richer and poor-get-poorer divide, raising the threshold for new users even higher.
Could that have been the purpose of the game?
Did they want to use this miniature version of society to criticize inflation and Korea’s low birthrate problem? Did they want to say that Korea, where new users are dwindling, is gradually declining like Raniji?
“...Chairman, I do not think so.”
When all the executives showed negative reactions to the AI business, one executive cautiously opened his mouth.
“Director Choi?”
“To be honest, there is no hope in Raniji. This patch will surely run into backlash from the established users again.”
“Director Choi!”
“If the government were investing one or two hundred billion won, I wouldn’t even bring this up. But it is a staggering 50 trillion. They will even lease out high-performance GPUs that are hard to obtain, and the government says it will bear all the related costs. So what reason do we have not to jump into this business?”
Director Choi raised his voice.
“We must do it! We have many strengths. CN Soft is the company with the best motion and graphic design in the country. When various film industries do CG work, they use our technology. Of course, our competitors won’t be easy, but is there any company that can match us in graphics?”
In truth, CN Soft was a pioneer of AI.
It had been the first in the country to apply technology similar to AI to industry.
Automatic hunting...
“We must stake everything on passing the preliminary round! And if we pass! Even if we have to reorganize our Raniji division, we must devote ourselves to this development!”
“Hey, Director Choi! Aren’t you going too far?”
“Reorganize Raniji? Does it make sense to give up a perfectly profitable business and jump into something that may or may not work?!”
“Chairman, let’s reorganize Director Choi first!”
Chairman Park Chan-yong waved his hand and silenced the executives.
He pondered for a moment.
If the scale of the government’s development project had not been as high as 50 trillion won, he would not have agonized like this. He would simply have developed something like Raniji AR as usual.
But an investment of this magnitude from the government did not come twice. At that level, it was worth risking the company’s fate.
“Let’s do it.”
He said to the Raniji development team.
“Proceed with the ‘Absolute Ssaulabi Sword’ patch within this month, and make the Aden event 20x instead of 10x.”
“You are absolutely right!”
“Instead, let’s invest every bit of the money we earn from it into AI.”
“Y-yes?”
Chairman Park said as he rose from his seat.
“Let’s collect from our users one last time. Let’s create proprietary AI technology, and later repay them with Raniji AR. In my opinion, now is the time to invest in AI rather than games.”
*
At the same time, at Hynix headquarters.
Chairman Kim Jeong-jin, who had just returned from family court, sat down in his seat.
Unlike the other companies, his face was full of confidence. Hynix’s recent performance had been tremendous.
Was that why?
As soon as he sat down, he spoke as if it were the most natural thing in the world.
“If we fail to pass the preliminary round of this government AI development project, every executive here will be fired.”
“Y-yes? Ch-Chairman...”
“I don’t think I’ll be able to pay attention to this matter for a while because I’ll be going to family court, so I trust our executives to handle it well.”