Insights

Chinese content has shifted from importing global formats to exporting its own. Overseas revenue from Chinese self-developed games reached USD 20.455bn in 2025, up 10.23% year on year, while the domestic short-form drama market expanded from RMB 37.4bn in 2023 to RMB 50.5bn in 2024 and RMB 100bn in 2025 — roughly 2.7x in two years. The Samjong KPMG Economic Research Institute traces that shift through four stages: current commercial performance, the sources of competitiveness, how Chinese companies and capital are expanding abroad, and what Korean companies should weigh in response.

Four foundations behind the commercial success. The report attributes Chinese content competitiveness to a large domestic market, government policy support, a consumption shift toward short-form formats, and advances in AI-assisted production. Seven of the fifteen highest-grossing mobile games by global in-app payment revenue in 2025 were Chinese titles. Chinese models also accounted for most of the top ten in Artificial Analysis' September 2026 performance ranking for video generation models with integrated audio, including ByteDance's Seedance, Alibaba's Wan and HappyHorse, MiniMax's model and Kuaishou's Kling. The report notes that Seedance 2.0, released in early 2026, prompted Hollywood producers, actors' bodies and major studios to raise copyright and likeness concerns — a sign that the technology now bears on production methods and IP frameworks rather than sitting in the experimental category. Content publishing licences (banhao) tell a similar story: 1,676 were issued to domestic titles in 2025 against 95 to imported ones, with approvals concentrating on home-grown games.

Four routes abroad: building, partnering, minority stakes and control. Expansion takes a different shape in each vertical. Genre range has broadened alongside it: Chinese developers built their early export position in mobile strategy titles and RPGs, and have since extended into subculture RPGs, shooters, puzzle games and high-specification PC and console action titles. In games, Chinese publishers operate through Singapore-based brands such as HoYoverse and Level Infinite while also taking equity positions; Tencent affiliates are the second-largest shareholder in both Shift Up (c.34.6%) and Krafton (c.14.2%). In June 2026, Chinese investment platform NeoPulse signed a share purchase agreement to acquire the entire 39.33% stake held by Wemade's founder for approximately KRW 920bn — a step beyond minority positions into control. In short-form drama, proprietary platforms including DramaBox and ReelShort are widening supply and co-production arrangements with Korean studios. In music, Tencent Music Entertainment became the second-largest shareholder in SM Entertainment through a KRW 243.3bn purchase.

Partner and competitor at once. The report's central caution is that Chinese counterparties supply capital and distribution while simultaneously accumulating user data and IP of their own. It sets out three risk-management priorities: retaining control of core IP and data, managing dependency at the corporate-group level rather than the individual entity level, and building staged response plans spanning everything from licensing delays to suspension of local operations.

M&A Implications. First, Tencent's broad minority holdings and the Wemade transaction establish Chinese capital as a credible inbound cross-border buyer for Korean content assets. Second, the issues that dominate diligence and negotiation are likely to shift accordingly — ownership of underlying IP and data, change-of-control provisions, and concentration exposure to a single corporate group. Third, tighter antitrust and national-security review in major jurisdictions could push deal teams toward valuations that price regulatory risk explicitly and toward staged acquisition structures. Finally, bolt-on acquisitions of Korean studios with short-form or AI production capability, alongside strategic minority investments, look set to increase.