South Korean video game developer and publisher Krafton has entered a strategic alliance with Hanwha Aerospace focused on physical AI. The two companies aim to develop and commercialise technology across various sectors, including defense.
The partnership combines Krafton’s AI research and software development capabilities with Hanwha Group’s industrial infrastructure in defense and manufacturing.
Krafton’s accumulated experience in operating large-scale game data and physics-based virtual worlds serve as core assets in training and verifying physical AI software. Built on this foundation, Krafton plans to power the real-world operation of physical AI, while validating feasibility across phased steps.
The strategic alliance will focus on three key areas:
- Joint research and development of core technologies behind physical AI
- Validating scenarios for technology implementation and physical application
- The establishment of technical and operational systems
Building on this alliance as a long-term partnership, Krafton plans to launch a JV with Hanwha to seamlessly advance joint development outcomes from implementation to commercialization.
Krafton will also invest in a fund established by Hanwha Asset Management centered on AI, robotics, and defense, with a target size of $1 billion USD. This investment in technologies and companies aims to expand the physical AI ecosystem and strengthen technology competitiveness. The fund will serve to identify partners with high growth potential across the core value chain.
“Krafton will accelerate the development of physical innovation by combining the company’s AI technology and software expertise with Hanwha’s industrial strengths,” said Krafton CEO CH Kim. “As our JV with Hanwha evolves to materialize co-development outcomes, we expect it to emerge as a global defense technology company like Anduril.”
“AI technology is rapidly growing beyond industries, with new physical AI applications in the defense sector,” said Jae-il Son, Hanwha Aerospace President and CEO. “Our partnership with Krafton will offer a new paradigm standard in areas of physical AI and future defense.
Leveraging its core AI technology and strengths as a global game publisher, Krafton continues to conduct long-term research in physical AI through a newly established robotics research entity, Ludo Robotics, based in the United States with operations in Korea led by Krafton CAIO Kangwook Lee. KRAFTON plans to explore long-term innovation and synergies built on two main pillars driving the CAIO organization: robotics research through Ludo Robotics and business implementation possibilities through the JV with Hanwha Group.
Steve is an award-winning editor and copywriter with more than 20 years’ experience specialising in consumer technology and video games. With a career spanning from the first PlayStation to the latest in VR, he's proud to be a lifelong gamer.
