Hana Securities: "Nvidia's entry into base stations is an opportunity for domestic telecom companies"

Hana Securities: "Nvidia's entry into base stations is an opportunity for domestic telecom companies"

Hana Securities has observed movements by global AI company Nvidia to expand its business from data centers to base stations, forecasting that this will ultimately lead to 5G investment by telecom companies and market expansion opportunities for domestic firms.

Researcher Kim Hong-sik stated in a report on the 5th, "Recently, Nvidia has been expanding its business from AI data centers to AI RAN (which integrates AI into mobile communication base stations). It can be seen that Nvidia, which has benefited from GPUs being installed in data centers for several years, is now looking for opportunities in AI base stations."

Previously, Jensen Huang, CEO of Nvidia, mentioned that "AI computing models will be integrated not only into computers, cars, and humanoids but also into satellites and base stations."

Regarding the reason for Nvidia's entry into AI base stations, researcher Kim said, "It is about completing an ecosystem by combining nationwide communication networks with edge computing (on-site data processing) for ultra-low-latency real-time AI processing." He added, "This is a strategy to preempt distributed intelligent infrastructure that communicates in real-time with real-world devices such as autonomous driving, robotics, and smart factories."

He further explained, "Existing base stations go beyond simply relaying signals to perform AI inference functions and provide real-time response services. Ultimately, it can be seen as strengthening platform competitiveness by linking power, networks, base stations, and data centers into one."

Regarding concerns in some quarters about potential disadvantages for existing companies due to Nvidia's entry into the base station market, he predicted, "It is highly likely to emerge as a positive factor. They will be much more significantly impacted by market expansion."

He explained, "This is because telecom companies will promote new growth by completing the construction of AI base stations through 5G and 6G investments, and regulatory bodies in various countries are also likely to encourage such investments for the success of Physical AI."

He concluded, "On the contrary, domestic outsourcing equipment companies are likely to enjoy market expansion opportunities. Unlike Samsung Electronics [005930], there will be no direct clash (competition) with Nvidia. Physical AI will serve as a catalyst to promote the adoption of 5G Standalone (SA) mode."