Japan and Korea AI Infrastructure: SoftBank, Sakura, SK — 2026-10-23
SK Hyper has launched a massive $350 billion funding drive to build 15GW of AI data centers in South Korea by 2035, targeting demand from Japan and Taiwan. Meanwhile, KDDI solidified a strategic partnership with Broadcom to enhance optical-electronic convergence in Japanese AI data centers, while Samsung SDS and LG CNS continue aggressive GPU investments despite global overcapacity warnings.
Japan and Korea AI Infrastructure: SoftBank, Sakura, SK — 2026-10-23
Top developments
SK Hyper seeks $350 billion for 15GW AI Data Center Plan
On October 23, SK Hyper, the AI data center unit of SK Telecom, announced it is seeking approximately $350 billion to fund the first 5GW phase of a massive 15GW AI data center plan in South Korea. The full 15GW capacity is targeted for completion by 2035, with SK Hyper planning to raise capital from global big tech firms and international investors. This move underscores South Korea’s ambition to become a primary AI infrastructure hub for Northeast Asia, specifically targeting demand from Japan and Taiwan.
KDDI Partners with Broadcom for Optical-Electronic Convergence
KDDI Corporation announced on October 22 a technical partnership with US-based semiconductor giant Broadcom Inc. to advance network infrastructure for AI implementation. The collaboration focuses on "optical-electronic convergence," a critical technology for reducing latency and power consumption in high-density GPU clusters. This partnership highlights the shift in Japanese telecom operators from pure connectivity providers to integrated AI infrastructure partners.
Samsung SDS and LG CNS Defy Overcapacity Warnings
Despite growing global concerns about AI infrastructure overinvestment, Samsung SDS and LG CNS are accelerating their GPU investments. Samsung SDS plans to invest 5 trillion won in AI infrastructure by 2031, aiming to expand its business scale from 110MW to over 800MW. LG CNS is also committing billions in won to GPU servers, betting that demand for domestic sovereign AI services will outpace the current supply glut.
Local view
Local Korean media is closely monitoring the tension between massive private sector investment and government energy policy. Maeil Business Newspaper reports that the Korean government is considering reducing the projected demand for AI data centers by 3–4GW due to grid stability concerns, which has caused confusion among major players like SK, GS, and Naver. The government's hesitation to approve direct power trading without KEPCO's involvement is seen as a bottleneck for the "speed-first" AI infrastructure race.
In Japan, Nikkei highlights the role of corporate venture capital, noting that a co-founder of Google’s AI emerging fund is coordinating with KDDI to strengthen Japan’s AI ecosystem through joint investments. Meanwhile, CNET Japan continues to track SoftBank’s "Neocloud" strategy, with the Tomakomai AI data center in Hokkaido scheduled for opening in fiscal 2026 and the Sakai center in Osaka aiming for operation in fiscal 2027.
Context & numbers
- SK Hyper Funding Target: $350 billion for the first 5GW phase; total plan is 15GW by 2035.
- Samsung SDS Investment: 5 trillion won planned for AI infrastructure through 2031.
- Korean GPU Supply Deal: A 260,000 GPU supply agreement was announced in late 2025, with the Ministry of Science and ICT securing 50,000 units for sovereign AI.
- Japan AI Power Capacity: Domestic AI data center IT power supply capacity is expected to double from ~300MW in late 2025 to ~600MW by the end of 2026.
- Sakura Internet Subsidies: Sakura Internet received the largest single allocation of ¥50.1 billion ($324 million) from METI to expand GPU deployments from 2,000 to approximately 10,800 NVIDIA GPUs.
On the radar
- KDDI SUMMIT 2026: Scheduled for late October, this event will feature displays from partners like Fairy Devices and likely further details on KDDI’s AI infrastructure roadmap.
- SoftBank Stock Volatility: SoftBank shares are experiencing a deep sell-off as the "AI Bubble Index" jumps to 74, reflecting investor anxiety over debt financing and AI returns.
- US Data Center Backlash: A nationwide backlash against US data centers is deepening Wall Street doubts about AI infrastructure debt, which may impact financing terms for Asian projects linked to US capital.
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