Google offers data residency for Korean corporate clients

Google Cloud has enabled Korean customers to use the tech giant’s generative artificial intelligence services to store their data domestically instead of overseas to alleviate customers’ worries over data leakage, while ramping up its efforts to expand its presence in the enterprise generative AI market here.

On Tuesday, Google’s cloud affiliate announced its new data residency guarantees for Korean clients through Vertex AI by including Korea as one of its first 10 global data storage locations, alongside the US, Canada, Japan and Singapore. Data residency refers to the geographic location where user data is stored.

Vertex AI is a machine learning platform introduced by Google Cloud in 2021, allowing clients to train and deploy machine learning models and AI applications, and to customize large language models for use in AI-powered applications. Google Cloud's Vertex AI has tools and over 100 AI foundation models, including Meta's LLaMa-2.

Korean corporate clients’ demand for control over their data storage location is increasing due to their data’s privacy, security and compliance with local laws and regulations. Especially with the emergence of generative AI, such as ChatGPT, users want to make sure their data is protected without being used as materials for upgrading Big Tech firms’ AI models, the company said.

Google Cloud’s latest feature not only allows domestic clients’ data to be stored here but also protects it through an encryption key, so that only applicable users can view and manage the data, Philip Moyer, Google Cloud’s global vice president of AI business, told reporters on the sidelines of the Google Cloud Summit Seoul 2023 event on Tuesday.

Although the number of domestic clients using Google Cloud’s data residency service has not yet been disclosed, the cloud service provider has supported accelerating customers’ content creation, process automation and information organization, while its key local clients include LG AI Research, Kakao Brain, Samsung Electronics, Kia and Korean Air, according to the company.

Kang Hyoung-jun, managing director of Google Cloud Korea, claimed that the tech giant is the first global cloud operator to open a residency in Korea, but industry sources said its archrival Amazon Web Services has already provided the same service here since 2016. AWS takes up a market share of over 60 percent in the Korean cloud sector so far, the sources said.

Market watchers believe Google Cloud is putting greater value on protecting customers’ data here, to actively target the cloud services for the public sector while competing against AWS, since the Korean government has removed regulatory barriers for foreign firms obtaining lower-grade Cloud Security Assurance Program certificates from earlier this year.

At Tuesday's event, Kang said Google Cloud is "under process" with the certificate application process, he touted the tech giant as the "fastest-growing public cloud firm." Yet AWS officials did not confirm on the matter, industry sources said the company appears to be applying for the CSAP certification process.

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