China is seeing a rapid expansion of AI-generated video, with filmmakers, technology companies and local governments moving to build a commercial industry around artificial intelligence-powered film and short-form content.
Shenzhen has emerged as an early hub for AI filmmaking. Zhu Zhili, an AI filmmaker who also heads the AI-Generated Content department at China Wit Media, said he has recently received approaches from officials in cities and industrial parks across China seeking to attract AI film businesses.
The growing interest reflects China’s wider effort to integrate AI across different parts of the economy. Local governments are offering subsidies, computing support, discounted or subsidised rent and other incentives to attract AI filmmakers and startups and establish technology clusters around AI-generated content.
The economics of AI-based production are also driving adoption. According to China’s state broadcaster CCTV, the cost of producing AI short dramas fell from 5,000 yuan ($747) per minute to a few hundred yuan per minute during the first half of 2026.
The lower production costs have encouraged a significant increase in content. DataEye data cited by Reuters showed that 221,900 new AI shows were launched on Douyin, China’s version of TikTok, during the first half of 2026. However, only 1,055 of those programmes attracted more than 100 million views, a benchmark commonly used to indicate strong audience performance.
Government support is also expanding beyond Shenzhen. Shanghai introduced measures in May to accelerate AI-powered micro-drama production, including access to computing power and cloud-based AI models. Beijing has established a 260 million yuan fund supporting audiovisual technology, while its Huairou district offers computing-cost vouchers to producers of short AI dramas. Shenzhen is providing technical support covering video production, visual effects and content generation, alongside subsidised rent.
Chinese entertainment companies are also increasing their involvement. iQIYI CEO Gong Yu said in August that the company was going “all-in” on AI and was offering some creators subsidies for AI-generated content distributed on its platform. Earlier this year, iQIYI also launched Nadou Pro, an AI agent designed for professional film and television production, supporting workflows from script development and storyboarding through production.
The expansion is not without challenges. The rapid increase in AI-generated content has raised concerns about oversupply, declining content value and originality. Actors have also raised concerns about the use of their likenesses in AI-generated films, while consumers have criticised plagiarism and the lack of originality in some AI content.
China’s National Film Administration has granted a public-screening licence to “Sanxingdui: Future Memories,” a 90-minute science-fiction film produced using AI by major Chinese studio Bona Film Group. The film is scheduled for release in China this year.
At the same time, China’s regulatory framework for AI-generated content is still developing. The country requires explicit labelling of AI-generated content, but clear copyright rules governing such material have yet to be established. This leaves questions around ownership, use of existing creative works and the rights of people whose likenesses or performances are incorporated into AI-generated productions.
AI-generated films are also beginning to reach international audiences. Director Cao Yiwen presented her AI-animated film at the World AI Film Festival in Cannes in April, highlighting the growing international visibility of China’s AI-content sector.
The rapid development of AI video in China is therefore taking place across multiple layers, from lower-cost production tools and AI filmmaking studios to government-backed technology clusters, streaming platforms and theatrical releases. At the same time, the industry’s expansion is bringing questions around demand, originality, copyright and regulation that will shape how AI-generated video develops as a commercial sector.
