Samsung SDS to bid for Seoul's cloud data center project

By Yoon Sung-won

Samsung SDS said Monday it is looking to participate in the Seoul Metropolitan Government’s (SMG) cloud data center establishment project.

the Samsung affiliate will be competing with LG CNS and SK Holdings C&C, despite undergoing internal disturbance in dividing its key logistics business. Expectations are high as this is the first government project regarding the latest network technologies combining big data, mobile, cloud and the Internet of Things that is accepting bids from conglomerates.

“We are reviewing the feasibility and profitability of bidding for the deal,” a Samsung SDS spokesman said.

SMG has said it will invest 11.5 billion won in building a cloud data center at the S Flex Center in Sangam-dong, western Seoul. In this project, the city administration said it will replace outdated network equipment with new x86 servers and integrate five network offices, which have been separated in Seoul, into one place through cloud technology. It will also establish an integrated security control system.

The metropolitan government said it will foster the new cloud data center as a hub to transform its old hardware network infrastructure into x86-based cloud systems by 2020.

The city administration said it will close the bidding by the end of this month.

The system integration affiliates of Samsung, LG and SK had competed to win the bid for the National Tax Service’s 230 billion won project to establish the next-generation system in 2012. Samsung SDS had managed to win a bid for a stake in the project that time.

But in 2013, as the government revised the law to limit conglomerates in joining in public IT projects, aiming at promoting smaller businesses in the IT service sector, Samsung SDS has withdrawn from public and financial SI service sectors and did not bid for a non-Samsung project since then.

With the company’s rare move to bid for a public project, suggestions are that it is mulling over restarting to seek business opportunities in public and financial IT service sectors outside the Samsung group, as a part of the preparations for its restructuring and to compensate for the division of logistics business.

Samsung SDS, however, denied that the bidding for the Seoul government’s cloud data center project is relevant to its restructuring plans.

“We are considering the bidding as a way to make use of our technologies and IT services in the public and financial sectors,” the Samsung SDS spokesman said.

He also said the company does not plan to expand its SI business.

“We are seeking for a part of the project by providing IT solution services,” the spokesman said. “We would have not considered the bidding if the project was about establishing a system or infrastructure as a whole.”