 "Samsung has been seeing impressive results from its cloud services division, which recorded a 35% jump in revenue in the third quarter of 2024 compared to the same period the previous year. Image Credit: Reuters")
Samsung SDS, the South Korean tech giant’s IT services arm, is gearing up to establish its first AI-focused data centre. The move signals Samsung’s ambition to ride the wave of growing global demand for AI computing power.
The new facility will be built in Gumi, South Korea, where the company has acquired land and infrastructure for approximately $15 million. This initiative is set to expand Samsung SDS’s already impressive network of 18 data centres worldwide, including five in South Korea.
Building for a booming market
The decision to ramp up AI infrastructure aligns with the industry’s ongoing race to meet the surging demand for AI capabilities. As companies across the globe adopt AI at breakneck speed, Samsung is positioning itself as a key player in this expanding market.
The timing couldn’t be more strategic. A recent study by IDC anticipates a sharp increase in AI workloads, with data centre capacities expected to grow at a staggering compound annual growth rate of 40.5% by 2027. In response, major players like Microsoft, Amazon Web Services, and Google Cloud have already committed to expanding their infrastructures. Samsung SDS is now following suit, doubling down on its investments to remain competitive in this evolving landscape.
AI strategy gets leadership backing
The company has been seeing impressive results from its cloud services division, which recorded a 35% jump in revenue in the third quarter of 2024 compared to the same period the previous year. Additionally, its collaboration with Microsoft Azure to launch the FabriX AI service further highlights its commitment to expanding its footprint in the AI market.
To ensure its AI-focused ambitions take off, Samsung SDS recently brought in Lee June-Hee as its new chief executive. June-Hee, a veteran of Samsung Electronics’ networking business, has a track record of driving innovations, particularly in the rollout of 5G networks for Samsung’s Galaxy devices. Under his leadership, the company is expected to intensify its investments in AI infrastructure while sharpening its overall strategy.
Looking ahead to big wins
Samsung’s plan to build its first AI data centre marks a pivotal step in its journey to dominate the AI and cloud services market. With an eye on skyrocketing demand, the firm is well-positioned to make significant gains.
Its robust infrastructure, partnerships, and fresh leadership signal a focused approach to staying ahead in the AI race. As the industry grows, Samsung seems set to cash in, leveraging its expertise and resources to carve out a bigger slice of the pie.