Chinese AI Apps Target Overseas Markets for Growth Amid Domestic Challenges
Introduction
Chinese artificial intelligence (AI) app developers are increasingly focusing on international users due to the highly competitive domestic market, industry insiders report.
Market Dynamics
While major tech firms and start-ups in China have been eager to release numerous large language models (LLMs) and associated applications, convincing local users to invest in these services has proven difficult. As a result, many companies are exploring opportunities abroad for expansion.
Research from Unique Capital highlights that, out of 1,500 active AI firms worldwide, 103 originate from China and are now actively seeking to enter foreign markets.
Examples of Expansion
Alibaba Group Holding has introduced SeaLLMs, specially designed for Southeast Asian markets, seamlessly integrating with its e-commerce and cloud computing operations in the region. Notably, Alibaba owns the South China Morning Post.
Another example is ByteDance, the parent company of TikTok, which has launched consumer-oriented applications such as the “AI homework helper” Gauth and the interactive character app AnyDoor, along with the AI bot platform Coze targeting global users. Additionally, Minimax, a prominent Chinese AI start-up, has debuted Talkie AI for the international market.
Industry experts suggest that overseas markets present more substantial growth prospects amid fierce domestic competition.
Insights from Industry Leaders
“Foreign users tend to be more willing to pay for software and there’s a larger pool of professionals who can provide valuable feedback,” stated Ryan Zhang Haoran, co-founder of Motiff. This company, known for its AI-powered user interface design tool launched in June, has been pursuing business opportunities both at home and globally from its inception.
Zhang remarked, “Utility-focused tools are favorable in international markets where customization demands are typically lower.” Motiff’s platform, which promotes team collaboration and AI-assisted design and generation, has successfully attracted its first users in the US, Japan, Southeast Asia, and Latin America, pricing its services at approximately 20% lower than current market leader Figma.
Beijing-based Kunlun Tech, which operates the Opera web browser and previously owned the gay dating app Grindr, is also actively expanding overseas. CEO Fang Han mentioned that competition abroad has intensified as more Chinese companies enter the global market.
“AI-generated content (AIGC) fundamentally reduces the barriers and costs for creators, disrupting the content industry,” Fang observed. Recently, Kunlun unveiled several AI-driven applications, including the music streaming service Melodio, the commercial music creation platform Mureka, and SkyReels, a platform for generating short-form dramas.
Fang shared, “We’re concentrating on markets with higher average revenue per user, such as North America, Europe, and Japan.”
Navigating Political Challenges
The growing tech rift, driven by tensions between Washington and Beijing, has compelled Chinese developers to navigate a complex political landscape, particularly in semiconductors and AI.
In response to these challenges, some Chinese companies have attempted to obscure their origins. Shenzhen-based generative AI start-up HeyGen moved its headquarters to Los Angeles and encouraged its Chinese investors to divest in favor of American ones to distance itself from mainland China amidst increasing scrutiny from both governments.
“Compliance is essential. Entering a new market requires adherence to its regulations,” noted Zhang from Motiff. He emphasized that while the company’s products remain consistent worldwide, their infrastructures are adapted for different markets through various open-source models and cloud services.
Fang indicated that while Kunlun’s domestic offerings prioritize “efficiency,” the team explores innovative AIGC tools and business models for its international applications. For instance, the Mureka app allows users to pay for access to AIGC tools and list AI-generated music for sale, with the platform earning a commission on each sale.
Despite facing challenges in areas such as chip development and computing power, Fang affirmed that Chinese companies excel in crafting consumer-oriented applications and possess a strong commercial acumen.
