Tencent executive details AI strategy: More domestically produced chips will be supplied in the second half of the year, and C-end monetization is "still in the early stages"

Golden Finance reports that on May 14th, according to The Paper, during a conference call, when discussing AI expenditure topics, Tencent executives stated that they see increasing demand for AI-related services from both internal products and external model users. “We previously guided that this year’s capital expenditure would increase compared to last year, and we are now even more confident and certain about this guidance. We expect capital expenditure to rise significantly, with more domestic AI chips arriving month by month in the second half of this year.” Regarding the return on AI products, Tencent President Liu Ciping said that model training is essentially an investment in the future and may not generate immediate returns. However, over time, capabilities will accumulate and help unlock many different business opportunities. Concerning the performance on the consumer side, Liu Ciping believes that in Western markets, paid service penetration is very high, and consumer spending levels are high. Subscription prices in Western markets are several times higher than similar services in China, whether for music or video services. China’s paid penetration rate is roughly in the single digits. When applying this to the Chinese market, based on a subscription model, the scale would not be as large. When a service must be supported by paid subscriptions, it is unlikely to be a winner-takes-all business; multiple participants will exist in the market, each holding a certain market share and subscription volume. Additionally, regarding e-commerce or advertising as monetization methods, “we have already considered this, and it is still in the early stages. Even in the U.S. market, where eCPM is much higher, leading players have not yet launched very mature advertising models.” (Dongxin News)