Stock Markets

Chinese AI apps eye overseas markets for growth amid tough competition, regulation at home


Chinese artificial intelligence (AI) app developers are increasingly eyeing international users, as the domestic market environment turns too competitive, according to industry insiders.

While China’s Big Tech firms and its start-ups have rushed to launch hundreds of large language models (LLMs) and related apps, it has been a challenge to convince Chinese corporate users and consumers to pay for these services, prompting some firms to look overseas for growth.

According to recent research by Unique Capital, among the 1,500 active AI companies worldwide, 103 hail from China but have started expanding into overseas markets.

Chinese tech firms have rushed to launch LLMs and related apps, but it has been a challenge to convince people to pay for them. Photo: Shutterstock Images

Alibaba Group Holding, for example, launched SeaLLMs, a model tailored for Southeast Asian markets last year, aligning with the firm’s e-commerce and cloud computing businesses in the region. Alibaba owns the South China Morning Post.

ByteDance, the owner of TikTok, has rolled out consumer-facing apps, including the “AI homework helper” Gauth, the interactive character app AnyDoor, and the AI bot platform Coze for global markets. Minimax, one of China’s leading AI start-ups, also launched Talkie AI for international users.

Industry insiders said that overseas markets offer greater growth potential amid fierce competition at home.

“Foreign users are more willing to pay for software and there’s a larger base of professionals who can provide valuable feedback,” said Ryan Zhang Haoran, co-founder of Motiff, creator of an AI-powered user interface design tool launched in June. Zhang noted that from day one, Motiff has pursued business opportunities at home and abroad.

“Utility-focused tools fit well in global markets where customisation demands are lower,” Zhang added. Motiff’s platform, supporting team collaboration and AI-assisted design and generation, has quickly secured its first batch of users across the US, Japan, Southeast Asia, and Latin America, with pricing set at about 20 per cent of the current market leader Figma.

Beijing-based Kunlun Tech, operator of the Opera web browser and former owner of gay dating app Grindr, is a veteran among Chinese tech firms expanding overseas. Chief executive Fang Han noted that the competitive landscape overseas has also become crowded as more Chinese rivals venture abroad.

“AI generated content (AIGC) fundamentally lowers the barriers and costs for creators, which is shaking up the content industry,” Fang said. Recently, Kunlun rolled out a series of AI-driven applications, including music streaming service Melodio, an AI-powered music creation platform for commercial users called Mureka, and SkyReels, a short-form drama generation platform.

“We’re focused on markets with higher average revenue per user, such as North America, Europe, and Japan,” Fang said.

The widening tech divide, fuelled by tensions between Washington and Beijing, has forced Chinese developers to navigate the politics of a rapidly changing landscape, particularly in semiconductors and AI.

Chinese developers have had to navigate the politics of a rapidly changing landscape, particularly in semiconductors and AI. Photo: Reuters

In response, some Chinese companies are trying to mask their origins. For example, Shenzhen-based generative AI start-up HeyGen relocated to Los Angeles and urged its Chinese investors to divest in favour of US counterparts, a move aimed at cutting links to mainland China amid heightened scrutiny from both Beijing and Washington.

“Compliance is critical. Entering a new market means adhering to its regulations,” said Zhang of Motiff. He added that while the company’s products remain consistent globally, their infrastructure is adapted for different markets using different open-source models and cloud services.

Fang said Kunlun’s domestic products prioritise “efficiency” while overseas, the team is experimenting more with AIGC tools and different business models. Its Mureka app, for example, lets users pay for access to AIGC tools and list their AI-generated music for sale, with the platform taking a commission on each transaction.

Fang said that while China’s AI technology still faces challenges in areas like chip development and computing power, Chinese companies excel at developing consumer-facing applications and have a keen sense when it comes to commercialisation.



Source link

Leave a Reply