※ URL(Korean): https://www.kisdi.re.kr/bbs/view.do?bbsSn=114692&key=m2101113055776&pageIndex=3&sc=&sw=

– The need to redefine the government’s role and establish new innovation policies for Korea’s advanced semiconductor industry 
The Korea Information Society Development Institute (KISDI, President Sangkyu Rhee) has released its Basic Research Report (24-10) titled “A Study on Measures to Enhance the Effectiveness of AI Semiconductor Policy.”

With artificial intelligence rapidly spreading across industries, the AI semiconductor ecosystem—including related technologies, semiconductor companies, and end-user sectors—is undergoing dramatic change. In particular, as AI semiconductor applications diversify, the co-evolution of essential supporting technologies such as networks, system software, servers, cloud computing, and on-device solutions has become increasingly evident.

This changing environment presents both opportunities and challenges for Korea, underscoring the need to establish an effective national AI semiconductor policy framework.

The report presents a comprehensive set of multi-dimensional and multifaceted strategies to strengthen Korea’s AI semiconductor competitiveness and enhance related policy effectiveness.
According to the report, first, AI semiconductors are emerging as a new growth driver in the semiconductor market. Key trends include: (1) the expansion of on-device AI and growing segmentation of AI semiconductors; (2) the entry of major big-tech companies as new market participants; (3) the emergence of new technological opportunities across different technical layers for optimizing AI semiconductor applications; and (4) the platformization of leading AI semiconductor companies.
Second, major advanced economies are increasingly recognizing high dependence on foreign semiconductor supply chains as a national security risk. As a result, they are promoting domestic semiconductor industries and restructuring supply chains around national interests. Many countries regard semiconductors as critical technologies for realizing next-generation industries—such as artificial intelligence, autonomous driving, smart factories, medical equipment, and advanced defense systems—and are fostering them as strategic sectors directly tied to national security.
Third, through analysis of Taiwan’s semiconductor industry and expert interviews, the study compares the semiconductor industries of Korea and Taiwan, finding that the two countries have different ecosystem structures, areas of specialization, and development paths. 

▲ Both began their semiconductor industries in the 1970s and 1980s, focusing on low value-added segments such as wafer processing, assembly, and packaging. 

▲Korea developed a memory semiconductor industry centered on the IDM (Integrated Device Manufacturer) model, while Taiwan concentrated on non-memory (system) semiconductors with a foundry-based business model.
Most notably, although Taiwan’s semiconductor industry has followed a technology catch-up trajectory similar to Korea’s, the nature and context of this catch-up have differed significantly.

▲Korea’s semiconductor development was led by large corporations in the private sector, with indirect government support, whereas the Taiwanese government took an active and direct role in catching up with advanced semiconductor technologies.

▲Korea’s approach was based on the large-scale production of memory semiconductors and integration of key element technologies under a corporate-led IDM model.

▲Taiwan adopted a demand-driven model centered on non-memory semiconductors, under which demand analysis, design, production, and packaging are systematically carried out over a three- to four-year cycle.

The report concludes that both Korea and Taiwan must move beyond their past catch-up models and chart new paths to pursue post–catch-up strategies in advanced semiconductors.

Building on this analysis, the report identifies key issues in Korea’s advanced semiconductor sector and provides policy recommendations. 
It identifies the following as key issues in Korea’s advanced semiconductor sector: the need to establish a supportive environment for advanced semiconductor design, promote conditions for mass production and commercialization, and support business model development and reference acquisition for advanced semiconductor companies.

Research Fellow Hyunjun Jung stated, “Korea’s semiconductor industry must move beyond its traditional catch-up strategy and establish a new leadership model. By examining the current status of the semiconductor industries in Korea and Taiwan, it is necessary to better understand our circumstances and identify the path forward.” Associate Research Fellow Minsik Kim added, “Advanced semiconductors have recently emerged as strategic core components directly linked to national security, calling for innovative support policies. It is essential to establish multidimensional and comprehensive programs to vitalize Korea’s advanced semiconductor ecosystem. The government must redefine its role and develop new innovation policies, designing support programs that not only enable a transition in production methods to meet diverse demand but also capture opportunities across multiple technological layers.”