"Game + AI" has become an industry consensus

Written by Chen Dengxin

Edited by Li Jinlin

Typeset by Annalee

Another new player joins the big model game.

Recently, miHoYo's big model Glossa passed the AI service registration, becoming a key tool to enhance user gaming experience.

This means miHoYo wants a piece of the AI pie.

Is entering the big model game a necessity for miHoYo? Why has "Game + AI" become an industry consensus? In the race for AI prowess, do giants have the upper hand?

Visibility up, but growth struggles remain

The big model field is getting increasingly crowded.

According to data from the Ministry of Industry and Information Technology, China's AI core industry has been expanding, with over 4,500 enterprises. Nearly 200 generative AI service big models have been registered and made available to the public, serving over 600 million users.

It's evident that the market is not short of big models, and there are even signs of oversaturation.

Against this backdrop, miHoYo's launch of the big model Glossa is intriguing: as the leader in otaku gaming, miHoYo is facing visible pressure.

After the release of "Genshin Impact," otaku gaming became the hottest niche, and miHoYo rode the wave to become a top player in the industry. However, four years later, "Genshin Impact's" popularity and revenue have waned.

"Genshin Impact" is no longer its former self

Data from Dian Dian shows that after several version updates in 2023, "Genshin Impact's" monthly active users have been declining.

More troubling is miHoYo's diminishing momentum.

In 2023, most otaku games flopped, with "Honkai: Star Rail" being the lone bright spot. However, even "Honkai: Star Rail" couldn't escape the fate of a strong start and a weak finish.

According to a research report by BOCOM International, among the top 10 mobile games by domestic revenue from January to August 2024, miHoYo had two titles: "Honkai: Star Rail" ranked ninth, with revenue down 13% year-on-year; "Genshin Impact" ranked tenth, with revenue down 52% year-on-year.

As for "Zero Domain," while highly anticipated, it failed to single-handedly save the day.

According to Sensor Tower, in September 2024, "Honkai: Star Rail" and "Genshin Impact" ranked 12th and 19th respectively in China's App Store mobile game revenue Top 20, with no sign of "Zero Domain." In the same month, "Zero Domain" ranked sixth in China's mobile game overseas revenue Top 30, behind "Honkai: Star Rail" and "Genshin Impact."

"Zero Domain" failed to single-handedly save the day

According to Compete, after the launch of "Zero Domain," the combined revenue of miHoYo's three products did not significantly exceed that of "Genshin Impact" alone in 2022. "We can see that the growth brought by similar commercialization and development models to miHoYo has gradually peaked, and competition for users among its three products has intensified."

In contrast, rivals like "Echoes of the Void" are rising.

While "Echoes of the Void" lags behind "Genshin Impact" and "Zero Domain" in visibility, it has shattered the belief that "only miHoYo can defeat miHoYo," revealing miHoYo's vulnerabilities and spurring competitors to up their game.

"Game + AI" becomes the game-changer

Thus, miHoYo is expanding its product line to shed its otaku gaming label while doubling down on AI to reinforce its core competency by enhancing product quality.

After all, AI has become an integral part of gaming.

As gaming growth slows and competition intensifies, the industry shifts from incremental gains to stock competition, making "Game + AI" the deciding factor.

This is because the AI revolution has entered a groundbreaking era, empowering various industries, and the gaming industry is a natural fit for big models.

Shi Yuzhu, founder of Giant Network Group, once said, "Where is the future of the gaming industry headed? Our internal research and current preparations focus on 'Game + AI' as the first priority."

Today, embracing "Game + AI" has become an industry consensus, and miHoYo is no exception.

Image source: "Cyberspace Shanghai" WeChat official account

On August 28, 2024, miHoYo founder Cai Haoyu publicly stated, "AIGC will revolutionize the game development industry; it's just a matter of time before this phenomenon unfolds fully."

There are three reasons behind this.

Firstly, it opens up new gameplay possibilities.

With AI, gameplay becomes more diverse, enhancing freshness and user engagement.

For example, traditional NPCs interact with players using preset content, resulting in robotic dialogue. With big models, NPCs become "intelligent," engaging in seamless conversations with players, adding emotional value.

Furthermore, traditional teaming relies on actual social interaction, which can be hit-or-miss. AI teammates solve the problem of unreliable partners, satisfying solo players and reducing social costs.

Dongwu Securities notes, "The maturity of AIGC text has given rise to AI interactive gameplay applications like Character.AI, Glow, and AI Dungeon, which resemble text adventure and otome games but offer far greater freedom. As AIGC technologies for images, 3D assets, and code mature, more AI-native gameplay is expected to emerge."

In other words, miHoYo aims to breathe new life into its products through big models.

Image source: Bilibili UP "Daily Insomnia Zhenjun"

Secondly, it improves efficiency.

Historically, high-quality gaming experiences, performance, and low costs were difficult to balance. AI breaks this "impossible trinity."

Take "Genshin Impact" as an example. Since its launch, it has maintained a pace of small updates every 25 days and major updates every 45 days, demanding significant content production.

As Haike Finance notes, "With longer content, innovation becomes more challenging. Plots and character designs can easily repeat, and players' expectations are hard to meet, leading to dissatisfaction."",With AI, quality and efficiency gains are easier to achieve.

Tencent Vice President Zhang Wei believes AI is now standard in game development: "We launched a new self-developed AI engine this year with AIGC capabilities for 3D graphics, narratives, levels, and more, boosting productivity in game scene creation and content generation by over 40 times."

Competing in big models requires hard power

It's worth noting that leveraging big models to reshape gaming is already widespread, even among mid-tier industry players like Giant Network Group.

In 2023, Giant Network Group mandated all developers learn AI tools to enhance efficiency and reduce costs. In 2024, it launched GiantGPT, a game AI big model, and BaiLing-TTS, a speech big model, covering AI painting platforms, UGC script creation tools, anthropomorphic intelligent Q&A systems, and AI-native gameplay.

However, the heavy lifting still falls to industry giants.

Big models are costly to develop and maintain, making them feasible only for well-funded internet giants."AI products face commercialization challenges, with 5% of heavy users consuming 85% of tokens," says Ding Chaofan, head of Giant Network Group's AI Lab. "Due to high inference costs, we can't open it to all players. If we did, the cost would be astronomical, and we must consider ROI."",In fact, Tencent and ByteDance have invested heavily in "Game + AI."",Take ByteDance as an example. Its Volcano Engine game AI solution, based on the Doubao big model, supports large-scale operations, meeting demands for massive resources, fast response, and elastic scaling, aiding game developers' AI needs.

Image source: "Volcano Engine" WeChat official account

Furthermore, it can access and integrate the latest content from Douyin, Xigua Video, Toutiao, and other ByteDance platforms, making "intelligent NPCs" more comprehensive and knowledgeable.

Jiang Nan, head of Volcano Engine's pan-internet industry solutions, says, "To make players feel like they're conversing with real people, we fine-tune the Doubao big model for each product's specifics at a granular level."",From this perspective, miHoYo's bet on big models is sound, but sustained investment demands significant human, material, and financial resources, testing the wisdom and patience of management."Thus, miHoYo's journey with "Game + AI" is still long and arduous.