Eric Schmidt, former Chief Executive Officer of Google, has made sharp criticism regarding South Korea’s AI competitiveness. He pointed out that rigidity in education and corporate structures is hindering Korea’s AI development.
In a recent event, former CEO Schmidt stated, “Japan and South Korea are not competitive in AI due to the rigidity of their educational and corporate structures.” He bluntly declared, “South Korea is not good at AI” and “they are not competitive in the AI race.”
This assessment draws particular attention as it comes from the key figure who transformed Google into a global technology giant. Schmidt served as Google’s CEO from 2001 to 2011, leading the company to become the world’s largest search engine.
Korea’s Lagging Position Revealed in AI Market Rankings
The current AI market has solidified into a duopoly between the United States and China. According to Stanford University’s AI Index, the United States scored a perfect 100 points, while China took second place with 50 points.
South Korea scored 20 points, reaching only one-fifth of the U.S. level. This is consistent with Korea’s 7th place ranking in other evaluations by the same institution.
America’s overwhelming dominance is confirmed by concrete achievements. Leading AI models that shape the world—including OpenAI’s ChatGPT, Google’s Bard, and Meta’s LLaMA—all originate from the United States.
China is also rapidly growing with AI models developed by Baidu, Alibaba, and Tencent, pursuing the U.S. with strong government support and massive data resources backing their efforts.
Three Major Structural Barriers Hindering Korean AI Development
Experts identify three structural problems as the root causes of Korea’s AI lag.
1. Shortage of AI-Dedicated Semiconductors
The first issue is the shortage of GPUs (Graphics Processing Units), essential tools for AI development. The AI-dedicated semiconductor market is currently monopolized by NVIDIA, with severe global supply shortages continuing worldwide.
While major U.S. and Chinese companies possess hundreds of thousands of GPUs, Korea struggles to exceed 20,000 units nationwide. The U.S. policy of restricting AI technology growth in China has made GPU procurement even more difficult for Asian countries.
2. Shortage of Top-Tier AI Talent
The second problem is the absolute shortage of experts capable of leading AI development. Among the world’s 500 AI specialists, 61 are concentrated in the United States, 45 each in China and India, but only 5 in South Korea.
This talent shortage stems from overwhelming salary gaps and differences in research environments. AI specialists in Silicon Valley often earn over $500,000 annually, and when stock options are added, the gap widens even further.
3. Insufficient Research Investment and Environment
The third issue is the poor investment and environment for AI research. Korean companies have primarily focused on hardware and manufacturing, resulting in relatively insufficient investment in software research.
Research projects in software fields—core to AI such as large model development and algorithm creation—are scarce, making it difficult for researchers to find employment opportunities. The lack of policy continuity also serves as an obstacle to AI research, which requires long-term perspectives.
Korean AI Must Find Breakthrough Through Differentiation Strategy
Experts believe there are still ways for Korea to survive despite the seemingly desperate situation. The realistic approach is to pioneer Korea’s unique domains rather than compete head-to-head with the U.S. or China.
Many suggest focusing on AI-dedicated semiconductor development by leveraging hardware manufacturing capabilities. There are opportunities to expand Samsung Electronics and SK Hynix’s memory semiconductor technology expertise into AI semiconductors.
Rather than competing directly with NVIDIA, targeting niche markets such as automotive AI chips or low-power AI chips for Internet of Things (IoT) devices is considered more realistic.
Expanding international cooperation is also necessary. This involves increasing AI research collaboration with Europe, Japan, and India to promote joint research projects and build ecosystems for sharing talent and technology.
“This May Be the Last Opportunity”
An AI expert stated, “Korea still possesses strong manufacturing foundations and excellent human resources,” adding, “The question is how to restructure these for the AI era.” The expert emphasized, “This may be the last opportunity.”
Eric Schmidt’s sharp criticism is being received as a warning to Korea’s AI industry. Whether to break away from current inertia and attempt bold changes, or watch the gap widen further, depends on the choices made by Korea’s AI sector.
