Under the catalysis of Alphabet Inc-CL C and Apple Inc's open-book ChatGPT, A-share related market continues to be hot. As the market continues to dig into the field of AIGC applications, analysts have recently focused on games.
Citic Construction Investment believes that compared with news, movies and art, AIGC has the greatest impact on game production in all entertainment media content areas, and the industry is also expected to usher in a double-click of AIGC science and technology innovation + policy repair.
Shen Wanhongyuan said that AI has penetrated or will infiltrate all aspects of the game industry chain, such as: art-AI drawing, AI real-scene computing, AI map; play / planning-AI plot, intelligent NPC and voice; game release, artificial intelligence delivery system, AI-driven CG production, and so on.
AIGC is expected to break the impossible triangle of the gaming industry
According to CITIC Construction Investment and Research News, the game has the highest degree of industrialization and interactive / real-time requirements of all content production, and there has always been "high quality-low success".
The impossible triangle of Ben-short time. That is, under the premise of ensuring the quality of the game, there are only two paths for game production: one is that a large number of developers produce a game at the same time, while the management and development efficiency of large teams is low, and the development cost is bound to increase; the other is to streamline team members. The production cycle is as long as several years or even more than ten years.
Generally speaking, the development time cost and money cost of high-quality 3A masterpieces are very high. Take the Wild Dart: redemption 2, which sold more than 46 million copies. The game has more than 28 square miles of near-real maps and 1000 NPC. Even with more than 1200 full-time developers, it took eight years to complete and cost nearly $300m.
With the productivity improvement brought by generative AI, it will break the impossible triangle of game production, greatly reduce the cost of game production, and break the impossible triangle. Take the original painting of a two-dimensional game as an example, it takes weeks for traditional original painters to complete the design according to the planned content, but using generative AI only needs to enter keywords to get a large number of first drafts of the design, which can be screened and modified later, and the time can be reduced to a few hours.
The details include:
1) assist the production process to reduce cost and increase efficiency, such as original painting generation, map rendering, sound material, NPC design, etc., can introduce generative AI technology to reduce game production costs and improve project efficiency.
2) upgrade interactive elements to enhance immersion experience: similar to ChatGPT conversations with human intelligence, various interactive elements in the game can be more intelligent, such as sound dynamic effects of thousands of people, art scenes that change dynamically with players, more intelligent NPC conversations, etc., resulting in a stronger overall sense of immersion.
3) lower the threshold of production and promote game innovation: liberate the traditional huge workload of game production, lower the threshold of production, drive the birth of more design ideas, and even realize the ability of individual users to customize game production.
Shen Wanhongyuan also pointed out that games have more dimensions and real-time interactive characteristics than text / picture / video. AI's transformation of the game industry can not only reduce costs and improve quality, but also improve efficiency. Games are an excellent testing ground to give full play to AIGC capabilities, as one of the most important scenarios of cutting-edge technology applications / one of the most important content forms of the Internet.Will not be absent from the content productivity revolution brought about by AIGC.
Big game manufacturers at home and abroad already have a layout.
According to CITIC Construction and Investment Research, there are currently many generative AI in the layout game field of many domestic and foreign companies, including overseas Activision Blizzard and EA, domestic comprehensive AI game studios such as Tencent, NetEase, Inc (mutual entertainment AILab), Xiao Bing Game Studio and Spellbrush, as well as start-ups specializing in 2D graphics, 3D assets, texture, animation, architecture, NPC, chatbot, music, dialogue and other fields. Specifically,
1) Mihayou: at this stage, invest in artificial intelligence to liberate art manpower and improve cartoon rendering ability.
2) Tencent: self-developed one-stop character animation pipeline tool set Superman, reducing the production cycle of voice mouth from 5 weeks to 1 second; GCloud game developed AI automatic skinning GoSkinning.
3) NetEase, Inc: NetEase, Inc mutual entertainment AI Lab to achieve AI to assist the original line drawing color, based on the face line draft to generate images; Fuxi game AI has achieved AI robot development and plot animation production and so on.
4) Activision Blizzard: its leisure games subsidiary King acquired artificial intelligence software company Peltarion in 22, which is expected to help make innovations in game design and operation; in addition, Activision Blizzard applied for a user-defined music patent in 22 years to create music with thousands of people.
5) EA: work with the University of British Columbia (UBC) in Canada to generate controllable football player roles without traditional programming and animation, and act basically in line with human movement patterns.
The game industry is expected to welcome double-click.
In addition to AIGC's technological innovation, analysts also mentioned the repair of policies in the game industry. After the restart of the version number in April 2022, the suspension in October, and the normal release from November to December, the release pace of the game version number returned to a stable pace in 2023.
Since the resumption of the release of game version numbers in April 2022, domestic game version numbers have been issued normally in other months, with the exception of May and October. 2022
An average of 67 version numbers are issued each year, 30 fewer than the average of 97 in 2021.
January 17 this year, 23 January issue, a total of 88 domestic games over the examination, slightly more than November, December 70, 84. Since the release of version numbers resumed in April 22, the number of domestic game versions that have been reviewed has shown an upward trend as a whole.
Citic Construction Investment believes that the game industry is ushering in AIGC science and technology innovation + policy repair double-click. As the version numbers of game products are obtained and launched one after another, it will clearly improve the prosperity of the industry; AIGC technological innovation, further release the vitality of innovation in the industry, boost the product pipeline, the industry is expected to usher in a double improvement in performance and valuation.
Guoxin Securities also believes that whether the game industry is expected to be extremely successful this year:
A) fundamentals of industry and listed companies: with the restart of version numbers and the change in regulatory trends, the launch of new games is expected to drive the domestic game market to pick up gradually under a low base; relying on the significant advantages of domestic game companies in R & D and operation, the offshore market still has room for continuous improvement, while the commercialization of TikTok is expected to replicate the domestic path and accelerate the release of operating dividends in overseas markets.
B) valuation and secondary market: under the background of pessimistic expectation and bottom boom, the valuation of sector and head game companies and the proportion of institutional positions are all at historical lows, with the objective basis of Davis' double-click under the shift of regulation, the overall improvement of the market environment and the recovery of the industry. In the medium and long term, the new technologies and new models represented by VR/AR, AIGC, meta-universe and WEB3 are gradually approaching. As one of the best content carriers, the valuation and even the fundamentals have the possibility of better-than-expected repair.
Edit / lydia