Core Viewpoint - The Chinese secondary dimension market is expected to reach approximately 597.7 billion yuan in 2024, nearly double the size of 2019, driven by the growing popularity of domestic IPs and government support for their development [1][9]. Market Expansion - The market for character-related sectors such as animation and gaming in China is rapidly expanding, with a projected market size of about 12 trillion yen (approximately 580.5 billion yuan) in 2024, doubling from five years ago [1]. - The "BiliBili World" event in Shanghai attracted around 300,000 attendees over three days, indicating a significant increase in interest and participation in the secondary dimension culture [8]. Domestic IP Popularity - The popularity of domestic characters is on the rise, exemplified by the success of the animated film "Nezha," which grossed over 15.4 billion yuan during the Spring Festival, setting a record for Chinese box office earnings [12]. - The top trending IPs on China's second-hand trading platform include "Love and Deep Space" and "Identity V," showcasing the growing presence of Chinese IPs alongside popular Japanese works [15]. Government Support - The Chinese government is actively promoting the development of original IP brands, as outlined in the "Special Action Plan for Boosting Consumption," which emphasizes support for the animation, gaming, and esports sectors [14]. - Policies in Shanghai aim to revitalize tourism through IP and support the development of original IPs, reflecting a broader governmental strategy to enhance the domestic market [14]. Future Projections - The secondary dimension market in China is projected to expand to 834.4 billion yuan by 2029, driven by increased production and circulation of animation and gaming content, as well as the growth of emotional value consumption [9].

Group 1 - The 15th China International Animation and Comic Copyright Protection and Trade Expo opened in Dongguan, showcasing over 2,000 film and animation IPs from more than 40 countries and regions [2] - Dongguan produces 1/4 of the world's animation derivatives and 85% of China's trendy toys, making it a key hub for the IP commercialization and trendy toy industry [2] - The expo aims to create a model for integrating the industrial ecosystem, with expectations for seamless collaboration between Shenzhen and Dongguan in IP creativity, smart manufacturing, and cross-border trade [2] Group 2 - Huasheng Fantawild highlighted the profound changes in content production due to AI, showcasing AI-generated IP characters, advertisements, and films at the expo [3] - The company emphasized the collaboration between content creators and AI tools to enhance efficiency in content production [3][4] - The expo featured a fully AI-produced film, demonstrating the potential of AI in the creative process [4] Group 3 - Shenzhen Rockteer Visual Effects Technology Co., Ltd. showcased its work on the "Nezha" series and emphasized the importance of quality content to meet the demands of the Z generation [5] - The company noted that the integration of Shenzhen's quality content with Dongguan's manufacturing capabilities can significantly enhance production efficiency [5] - The production value of "Nezha" peripheral products has already surpassed its box office revenue, indicating a successful trend in the Chinese animation industry [5] Group 4 - Mr. Crane VR introduced innovative virtual reality technology in animation creation, presenting seven new original works at the expo [6] - The company aims to leverage its unique offerings to attract more industry clients and establish partnerships [6]

Core Viewpoint - The Chinese cultural industry is experiencing a significant transformation, with the rise of original IPs and a shift in consumer demand, indicating that it may be on the verge of a major breakthrough [1][10][12]. Group 1: Cultural Industry Trends - The LABUBU phenomenon exemplifies the rapid growth of the Chinese潮玩 (trendy toy) market, which has expanded from 6.3 billion yuan in 2015 to 60 billion yuan in 2023, marking a nearly tenfold increase [13]. - China's潮玩 market reached nearly 30 billion yuan in 2020, increasing its global market share from 11.18% in 2017 to 19.74% in 2020 [12]. - The current economic context, characterized by a per capita GDP of $13,800 and a shift from material to service-oriented consumption, supports the ongoing cultural consumption boom [1][12]. Group 2: Historical Context and Comparisons - Japan's cultural industry growth in the 1970s and 1980s, following its economic boom, serves as a historical reference for China's current trajectory [2][3]. - The Japanese anime and潮玩 industry saw significant expansion during its economic recovery, with key developments in the 1950s and 1980s that catered to both children and adult markets [6][9]. - The evolution of Japan's cultural industry illustrates the importance of economic transformation in fostering creative industries, which China is currently experiencing [12][18]. Group 3: Future Prospects and Challenges - The Chinese cultural industry is at a critical juncture, with emerging IPs like《黑神话：悟空》 and《哪吒2》 signaling potential for growth, yet facing challenges such as weak IP incubation and talent shortages [15][16]. - The government emphasizes expanding domestic demand and cultural consumption, indicating a supportive policy environment for the cultural sector [14]. - The future of China's cultural industry will depend on its ability to innovate, integrate technology, and expand its global reach while remaining rooted in its cultural heritage [18].