KT, Microsoft to develop Korea-customized ChatGPT

KT will develop a Korea-customized ChatGPT and AI assistant together with Microsoft as the U.S. tech giant strives to lead Korea's AI market.

KT CEO Kim Young-shub, right, shakes hands with Microsoft CEO Satya Nadella after signing an agreement to collaborate in developing Korea-customized AI at the tech giant's headquarters in Redmond, Washington, on Friday. [KT]

KT will develop a Korea-customized ChatGPT and AI assistant together with Microsoft as the U.S. tech giant strives to lead Korea's AI market.

The Korean major telecommunications provider said Sunday it inked a five-year strategic partnership vowing cooperation in AI and cloud business, where the two will invest trillions of won over the next five years.

Under the partnership, KT and Microsoft will develop a ChatGPT model suitable for Koreans using the technology for Open AI's GPT-4o and Microsoft's Phi family of small language models alongside KT's accumulated data for Korean regulation ecosystem and cultures.

This AI model will be used in KT's customer service chatbots, as well as for corporate clients.

KT will also develop its own AI assistant for Korean users using Microsoft's Copilot, its AI-powered conversational agent. The company also plans to develop the KT-custom AI assistants for various business applications including education, health care and in-vehicle infotainment.

The duo will also cooperate in building sovereign cloud services that can be used in public and finance sectors that have strict privacy and regulatory requirements.

A sovereign cloud operates in compliance with the local laws of each country regarding data storage requirements, information collection and data access. Microsoft's experiences on building such frameworks in various European countries including Switzerland, Italy and Belgium will help KT have the system in Korea, the Korean company said.

“The partnership with Microsoft presents a pivotal opportunity, not only for technological collaboration, but also for expanding Korea’s AI foundation and driving transformative innovation across industries and daily life,” said KT CEO Kim Young-shub. “Leveraging this strategic partnership, we aim to rapidly evolve into an company with unparalleled competitiveness in domestic and global markets.”

KT plans to establish a new subsidiary dedicated to helping businesses transform with the latest AI technologies. Microsoft will offer professional consulting over the next three years.

The company will also work with Microsoft Research to run research projects to develop new AI technology and future networks. The two will open an Innovation Center in KT's headquarters in Gwanghwamun, central Seoul, to support the research and elaborate on investment on AI startups.

BY SARAH CHEA [chea.sarah@joongang.co.kr]