Cathay Pacific Haitong: Accelerating Iteration of the World Model and Hoping to Become a New Engine for Entertainment Content
The Zhitong Finance App learned that Cathay Pacific Haitong released a research report saying that the essential breakthrough in the world model is “interactivity,” and that AI interactive movies and games are pioneers in entertainment. Combined with XR devices, they are picking up a new cycle of content. 1) Games: The “main battleground” for AI interactive movies and games, which benefit both cost reduction and gameplay innovation. 2) Film and television: AI skits are the starting point for interactive video games, and the cost of content supply has dropped dramatically. 3) Marketing: The most direct way to reduce the cost of AI material generation and the fastest commercialization process.
Cathay Pacific Haitong's main views are as follows:
The world model has entered a period of intensive iteration, and the investment and financing boom is surging
The world model is an underlying technical framework that enables AI to recognize the environment, deduce, and make decisions. The core is for AI to imagine consequences and predict the future in the mind before acting like a human. In the second half of 2026, the global world model entered a period of intensive iteration, and technology routes were divided into various orientations. In terms of investment and financing, World Model is more popular. Both AmiLabs and World Labs have raised more than 1 billion US dollars, and the financing rounds are mainly seed rounds and A rounds. Domestic and global model investment and financing are also popular. From January to July 2026, companies such as Smart Ping Fang, Kuwa Technology, and Shengshu Technology received large amounts of financing intensively. Judging from the maturity of implementation, 3D generation and spatial intelligence capabilities have been commercialized and are expected to be the first to be applied in the field of games, film and television. A new cycle of entertainment content may be in the future.
AI interactive video games are expected to become the pioneers of world model entertainment content
The core of generating entertainment content from the world model is interaction. AIGC's implementation in the field of entertainment has moved from content production and audiovisual presentation to interactivity, and user choices can change the plot trend, scene state, and even character fate in real time. Currently, the AI skit market is basically mature. In 2025, China's AI skit market will reach 18.98 billion yuan, and is expected to reach 70.60 billion yuan in 2026. AI interactive skits will be the first to be launched. At the same time, Douyin and Kuaishou have added AI interactive content. The EA version of “Don't Ask Me” is estimated to sell nearly 300,000 copies in the three weeks since its launch on Steam, and the entry of the leading IP of “Three Body: The Night Before Judgment” pushes AI interactive movies into an industrial-level channel. Looking ahead to the end, AI interactive video games will complete the three-level jump from real shooting branch tree to AI-generated images to world simulation. Interaction is the reason for payment and the core of the experience, the game mechanism is a commercial framework and long-term operation carrier, and AI generation for film and television is an expression-layer tool. According to Gamma Data's forecast, AI is expected to bring about 533-84.6 billion yuan of new market space to China's game industry in the future.
XR headsets are important carriers, leading companies are focusing on building and improving the industrial chain
As an important vehicle for generating entertainment content in the world model, XR headsets are expected to resume growth in 2027 after experiencing a downturn in the past few years. From September to October 2026, Meta completed VR and smart glasses product iteration at the Connect conference. The XREALAURA, the world's first split XR glasses equipped with Android XR, was released, and the new Byte Pico Space Pro may be released on December 2, and its self-developed world model is also expected to be unveiled in the near future. The equipment update period resonates iteratively with the world model. The world model is responsible for generating content and the headset is responsible for presenting the content. The virtual 3D world anticipated by the metaverse is expected to gradually be realized when supply and demand are matched.
Risk warning: World model technology progress falls short of expectations, commercialization of AI interactive movies and games falls short of expectations, recovery in XR headset shipments falls short of expectations, policy and regulatory risks, and copyright and IP licensing risks.