Chinese AI Apps Look Abroad for Expansion Amid Tough Competition and Regulation at Home
Chinese artificial intelligence developers are increasingly focussing on international markets as a means of expansion. A tailored AI model is being introduced by companies such as Alibaba and ByteDance in order to facilitate global expansion. The potential for growth and the propensity to pay for AI services are higher in overseas markets.
In a bid to navigate the challenges of persuading Chinese corporate users and consumers to pay for AI services, many companies are now seeking growth opportunities overseas.
Research conducted by Unique Capital indicates that out of the 1,500 active AI companies globally, 103 originate from China and have commenced their expansion into foreign markets.
For instance, Alibaba Group Holding introduced SeaLLMs, a model tailored for Southeast Asian markets, aligning with the company's e-commerce and cloud computing ventures in the region. Similarly, ByteDance, known for TikTok, has launched various consumer-focused apps like Gauth, AnyDoor, and Coze for the global audience. Additionally, Minimax, a prominent Chinese AI startup, unveiled Talkie AI targeting international users.
Industry insiders emphasise that overseas markets present significant growth prospects amidst fierce competition domestically. Ryan Zhang Haoran, co-founder of Motiff, highlighted that foreign users exhibit a greater willingness to pay for software and offer valuable feedback, driving companies to explore global opportunities.
Motiff, a creator of an AI-powered user interface design tool, strategically tapped into both domestic and international markets. Zhang noted that tools with a utility focus resonate well in global markets where customisation demands are relatively lower. Motiff's platform, facilitating team collaboration and AI-assisted design, has swiftly garnered users across the US, Japan, Southeast Asia, and Latin America.
Kunlun Tech, based in Beijing and known for the Opera web browser and former ownership of Grindr, stands out as a seasoned player among Chinese tech firms expanding overseas. CEO Fang Han highlighted the increasing competition abroad as more Chinese companies venture into international territories.
Fang emphasised the transformative impact of AI-generated content (AIGC) on the content industry, noting that it reduces barriers and costs for creators. Kunlun has recently introduced AI-driven applications like Melodio, Mureka, and SkyReels, targeting markets with higher average revenue per user such as North America, Europe, and Japan.
As tensions between Washington and Beijing contribute to a widening tech divide, Chinese developers are adapting to the evolving landscape by concealing their origins. For instance, HeyGen, a generative AI startup from Shenzhen, relocated to Los Angeles to distance itself from mainland China amid increased scrutiny from both governments.
Expanding into new markets requires strict compliance with local regulations, emphasised Zhang from Motiff. While the company maintains product consistency worldwide, it tailors its infrastructure to suit different markets by utilising various open-source models and cloud services.
Kunlun's Fang highlighted that their domestic products focus on "efficiency," whereas internationally, they are exploring AIGC tools and diverse business models. For instance, their Mureka app allows users to access AIGC tools and sell AI-generated music, with the platform earning a commission on sales.
Despite challenges in AI technology development in China, such as chip technology and computing power, Chinese firms excel in creating consumer-oriented applications and possess a strong commercialisation acumen.
Chinese AI developers turning to overseas markets for growth
Companies like Alibaba and ByteDance launching tailored AI models for global expansion
Overseas markets offer greater growth potential and willingness to pay for AI services
Source: SCMP