- SK Telecom's board approved the establishment of SK Hyper, a wholly owned subsidiary, with a 750 billion won ($510M) capital commitment through 2030 [1] - The 15GW buildout is split into two phases: 5GW of domestic capacity from 2029, and an additional 10GW from 2035 contingent on market conditions [2] - A flagship 100MW hyperscale facility in Ulsan targets Q4 2027 operations, with the southeastern cluster scaling to 2GW+ [3] - The initiative is part of a broader 312 trillion won ($201.7B) coordinated investment in southeastern Korea alongside Hanwha, Hyundai Motor, and Samsung [3] - SK Telecom's SEC filing notes the plan is 'still under review and may change,' citing power supply, land acquisition, and regulatory approvals as potential obstacles
[2] SK Telecom has launched a dedicated AI data center subsidiary, SK Hyper, with a stated ambition to build up to 15GW of capacity across South Korea by 2035. The company's board approved the new unit on June 29, 2026, authorizing phased capital contributions of up to 750 billion Korean won ($510 million) through 2030 [1].
SK Hyper will begin with a 100MW hyperscale facility in the southeastern port city of Ulsan, targeting Q4 2027 operations. From there, the company plans to scale to a 2GW+ cluster in the broader Gyeongsang region, add 1GW in the southwestern Jeolla region, and reach 5GW of total domestic capacity by 2029 — with a further 10GW earmarked from 2035 onward [2] [3].
The launch positions SK Telecom as the anchor of South Korea's national AI infrastructure push. President and CEO Jung Jai-hun has described the initiative as an effort to 'preemptively prepare the computing infrastructure that the global AI ecosystem needs,' framing the buildout as the country's third major infrastructure revolution after the Gyeongbu Expressway in 1968 and nationwide broadband in 1998 [4].
The Buildout Plan #
SK Hyper's 15GW target is structured in two distinct phases. Phase 1 calls for 5GW of domestic capacity with staged openings beginning in 2029. The Ulsan-anchored southeastern cluster accounts for over 2GW, with additional GW-class deployments planned in the Chungcheong and Jeolla (Honam) regions [4] [5].
Phase 2 envisions an additional 10GW from 2035, though SK Telecom's own SEC filing (Form 6-K, filed June 30, 2026) is explicit that this second tranche is 'contingent on first-phase progress and market conditions.' The filing notes the entire plan remains 'under review and may change,' citing market demand, power supply, land acquisition, regulatory permits, and financing as open variables [2].
At an estimated cost of approximately 70 trillion won per 1GW facility, the full 15GW buildout would represent a total investment in the hundreds of billions of dollars. SK Telecom has indicated it will fund the effort through a mix of company capital, strategic partner investment, long-term customer contracts, and project financing [4].
The Ulsan Anchor #
The first concrete deliverable is a 100MW facility in Ulsan, a major industrial city on South Korea's southeastern coast. This site is already under construction and is scheduled to begin operations in Q4 2027 [3].
From that anchor, SK Hyper plans to scale the Ulsan campus and surrounding Yeongnam region to over 2GW, with an additional 900MW in the immediate area and 1GW elsewhere in the Gyeongsang region. The 5GW phase alone would require approximately 3 million GPUs, 2.4 million HBM units, and 2.5 million square meters of land [3].
Power and Strategic Rationale #
SK Telecom has cited South Korea's nuclear and LNG-based power supply as a core competitive advantage for large-scale data center deployment. The country's experience operating GW-scale semiconductor fabrication facilities — particularly through SK Group affiliate SK hynix — provides an operational template for data center clusters at similar scale [4] [5].
The International Energy Agency projects global data center electricity consumption could double to approximately 945 TWh by 2030, and SK Telecom is positioning the buildout as a play on Asia's AI compute demand. CEO Jung Jai-hun has argued that combining manufacturing AI workloads with the region's existing industrial base could 'transform the region into a hub for the verification and expansion of manufacturing AI' [3] [4].
The Broader Korean AI Push #
SK Telecom's initiative is part of a coordinated 312 trillion won ($201.7 billion) southeastern Korea investment package announced in early July 2026. Partners include Hanwha (55 trillion won for space and defense data centers), Hyundai Motor (42 trillion won for autonomous driving and manufacturing AI infrastructure), and Samsung (60 trillion won for humanoid robotics and battery AI). SK Telecom's own Yeongnam commitment totals 140 trillion won ($91.5 billion) [3].
At the national level, South Korea's government has outlined a combined 8.4GW data center target across SK, GS Group, and Naver, backed by an initial 550 trillion won investment commitment. The country is positioning itself as one of the world's three leading AI powers alongside the United States and China [5].
Investor Considerations #
SK Telecom trades on the NYSE under the ticker SKM. The company is already exploring external capital for the buildout — a recent report indicated SK Telecom is nearing a sale of a 49% stake in the Ulsan AI data center to a KKR-led consortium, a deal that would validate third-party investor appetite for South Korean AI infrastructure [6].
The 750 billion won ($510 million) initial commitment to SK Hyper through 2030 is modest relative to the full scope of the plan, reflecting a phased approach that preserves optionality. SK Telecom retains 100% ownership of SK Hyper and will provide capital contributions in stages as milestones are met [1].
Companies mentioned #
Further sources #
[[1] Light Reading — SK Telecom commits $510M to new AI data center subsidiary ↗](https://www.lightreading.com/data-centers/sk-telecom-commits-510m-to-new-ai-data-center-subsidiary)
[[2] SK Telecom Form 6-K SEC Filing via StockTitan ↗](https://www.stocktitan.net/sec-filings/SKM/6-k-sk-telecom-co-ltd-current-report-foreign-issuer-6b95e0cd5f54.html)
[[3] Let's Data Science — SKT Commits to Yeongnam Hyperscale AI Data Centers ↗](https://letsdatascience.com/news/skt-commits-to-yeongnam-hyperscale-ai-data-centers-4d0dee43)
[4] PR Newswire — SK Telecom Pursues 15GW AI Data Center Buildout ↗
[[5] Cloud Computing News — South Korea AI data centre push includes SK Telecom's 15… ↗](https://www.cloudcomputing-news.net/news/south-korea-ai-data-center-skt-15gw/)
[[6] Data Center Dynamics — SK Telecom to sell minority stake in Ulsan data center ↗](https://www.datacenterdynamics.com/en/news/sk-telecom-to-sell-minority-stake-in-ulsan-data-center-report/)
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