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China’s $2.8 Billion Live-Streaming Market Rocked by Tencent’s AI Avatar Ban

Chinese internet giant Tencent Holdings plans to prohibit the use of AI-powered digital avatars on its live video streaming e-commerce platforms. As the South China Morning Post (SCMP) reports, the move comes as Beijing authorities tighten oversight of AI-generated content.

According to the SCMP, Tencent’s Weixin Channel, the video platform for its WeChat messaging app, has published draft rules banning “low-quality content” like “plug-ins, AI and other tools to generate avatars for live streaming.” The rules also state that “teaching and selling virtual human software” will be considered “confrontational behavior” and prohibited.

The draft regulation aligns with recent efforts by China’s internet regulator, the Cyberspace Administration of China (CAC), to crack down on discriminatory or false content created with generative AI technologies. The CAC requires local providers of AI services to implement measures to prevent the spread of such content.

Tencent states that violators of the new rules will face penalties. Online hosts breaching the guidelines will have reduced exposure from Tencent’s algorithms, while more egregious violators may have their e-commerce functions disabled. Sources familiar with the matter told the SCMP that Tencent aims to “encourage more [live] anchors to have real-time interaction with viewers” through the changes.

The draft is open for feedback from live streamers until June 13, after which Tencent will review the comments. Consultants like Li Chengdong of Dolphin believe the move protects the interests of Tencent’s platform by preventing individuals from deploying thousands of low-cost AI avatars that could disrupt the live-streaming marketplace.

While enacting restrictions, Tencent’s rivals like have embraced virtual AI avatars, with the company’s chairman, Richard Liu Qiangdong, hosting live sessions as a digital human. Competitor Alibaba has not prohibited the technology, with its cloud unit offering AI avatar services starting at $792 per month.

The SCMP cites research from iiMedia, stating that China’s live-streaming e-commerce market was valued at 20.52 billion yuan ($2.8 billion) in 2022 and is projected to more than double to 48.06 billion yuan ($6.7 billion) by 2025.

Cecilia Carloni, Interview Manager at Influence Weekly and writer for NetInfluencer. Coming from beautiful Argentina, Ceci has spent years chatting with big names in the influencer world, making friends and learning insider info along the way. When she’s not deep in interviews or writing, she's enjoying life with her two daughters. Ceci’s stories give a peek behind the curtain of influencer life, sharing the real and interesting tales from her many conversations with movers and shakers in the space.

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