NTT, SK Group plan $440M AI optical network fund
June 8 (Asia Today) -- Japanese telecom giant NTT is moving to invest in next-generation artificial intelligence infrastructure with South Korea's SK Group and Taiwan's Chunghwa Telecom, according to a Japanese media report.
Yomiuri Shimbun reported Monday that NTT plans to establish the IOWN AI Fund, with assets of more than 70 billion yen, or about $440 million, to accelerate the global expansion of its next-generation optical communications platform.
NTT, SK Group, Chunghwa Telecom and the Development Bank of Japan are expected to participate in the fund. SK Group owns SK Telecom and SK Hynix, a major memory chipmaker. NTT, SK Group and Chunghwa Telecom have already been cooperating on IOWN technology development.
More than 10 Japanese companies, including Mitsubishi UFJ Bank, Sumitomo Mitsui Banking Corp., Mizuho Bank, Sumitomo Mitsui Trust Bank, Toshiba, Sony Group and Fujitsu, have also shown interest in investing, Yomiuri reported.
The fund plans to invest in startups in North America, Asia and Europe working on photonics-electronics convergence, AI semiconductors and advanced AI models based on IOWN infrastructure.
IOWN stands for Innovative Optical and Wireless Network. NTT announced the concept in 2019 as a next-generation information and communications platform that uses light instead of electricity for data transmission inside chips and communications networks. The goal is to enable low-power, high-speed and high-capacity processing.
The technology has gained attention as generative AI drives rapid growth in data-center power consumption and increases demand for more efficient communications and computing infrastructure.
NTT announced the creation of the IOWN Global Forum with Intel and Sony in 2019 to promote international standardization. The forum launched in 2020 and has since expanded to include companies in telecommunications, semiconductors, data centers and cloud computing.
NTT and Chunghwa Telecom began operating an international IOWN optical network in 2024 linking Chunghwa Telecom's data center in Taoyuan, Taiwan, with NTT's research and development center in Musashino, Tokyo. The companies said they confirmed one-way low-latency transmission of about 17 milliseconds over the roughly 1,860-mile route.
The planned fund is intended to broaden real-world use of IOWN by supporting startups and product development in related fields. For NTT, the initiative could link Japan's communications technology with South Korea's semiconductor industry, Taiwan's network infrastructure and Japanese financial and manufacturing capital.
The AI semiconductor market is led by U.S.-based Nvidia, while China's Huawei is accelerating development in telecommunications equipment and AI chips. Photonics-electronics convergence is seen as a possible way to reduce power consumption and communication delays in AI data centers.
For South Korea, SK Group's participation reflects a broader shift in AI competition. The race is moving beyond model development toward the underlying infrastructure that combines power, semiconductors, data centers and communications networks.
-- Reported by Asia Today; translated by UPI
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Original Korean report: https://www.asiatoday.co.kr/kn/view.php?key=20260608010002491
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