Hi everyone this is Cheng Ting-Fang, also known as Annie!

When my flight landed in Taipei over the weekend, a wave of relief washed over me. I finally felt a sense of "mission accomplished" after a frenetic week.

At the same time the previous week, I was rushing out of the opening ceremony for TSMC's first chip plant in Japan to catch a flight back to Taiwan. It was a mad dash from the plant, nestled amidst cabbage fields in the town of Kikuyo, Kumamoto, to Fukuoka Airport. From the venue, I had to hitch a ride with a colleague's friend who lives in the area to the train station 50 minutes away. I then rushed to grab the bullet train to Hakata, from where I snagged a taxi and raced to the airport. I managed to board barely 30 minutes before departure.

The stakes were high, as this was the only flight that would allow me to make my connection to Barcelona to attend the Mobile World Congress on time.

The flagship wireless and telecom industry fair in Europe always provides a good chance to hear firsthand about top trends, new devices and the market outlook. It was a whirlwind of interviews and networking events for me and my colleague, Lauly Li. In less than a week, we were able to turn out stories about tech titans such as Huawei, Qualcomm, Intel, HPE, Dell, Honor, Docomo and Microsoft. And there is more to come.

In the massive venue spanning eight exhibition halls, I bumped into a Chinese friend. He now works for ASR Microelectronics, a chip developer specializing in chips for routers, connected devices and wearables. This industry veteran said it was the first time for his company to allocate a significant marketing budget to attend a show so far from home. But venturing overseas, he emphasized, is now a necessity for many Chinese companies.

"The domestic market is fiercely competitive, like a churning whirlpool. This intense internal competition and price war is pushing many companies, including our customers, to seek opportunities overseas," he said. "In fact, the first day here, we realized we need to add more meeting rooms to our booth design next year. Some of our clients without booths of their own even asked to use our space to meet with potential foreign customers!"

Spreading its wings

ASR is not alone in looking abroad. China's AI champion and leading provider of voice recognition tech, iFlytek, aims to increase its presence in Europe and other regions outside of China despite a U.S. trade blacklisting that limits its access to American technologies.

To accelerate this strategy, iFlytek has developed an application called Deepting, which produces speech-to-text transcriptions in real time. The company aims to bring numerous other AI-powered solutions overseas, such as real-time translations of voice input and voice-activated control systems for smart homes. Some other eye-catching applications include "virtual humans," digital avatars that users can create with just a short video of themselves. These virtual humans can then present any material or slides with just a few clicks.

iFlytek's global push underscores the company's determination to compete in the international market despite being cut off from most advanced American technologies, write Cheng Ting-Fang and Lauly Li of Nikkei Asia.

The company also has servers overseas in Singapore, Dubai and Frankfurt to help its expansion. For its consumer-centric Deepting App, it even specifies that the data is stored on the servers of Amazon Web Services.

Headquartered in Hefei, China, iFlytek has been grappling with U.S. export controls since 2019. Despite this hurdle, it has managed to build its own large language model, Spark, trained and supported by Huawei, another leading Chinese tech giant that is blacklisted by the U.S.

However, iFlytek is not immune to the impact of U.S. sanctions. Its net profit has shrunk significantly in recent years, though the company attributed this to increased marketing expenses and R&D investments aimed at enhancing its competitiveness.

A helping handout

China is lavishing subsidies on its artificial intelligence sector, which is struggling with rising costs as large cloud providers hog AI chips that are in short supply following U.S. restrictions.

Internet giants Alibaba, Tencent and ByteDance have limited the rental of Nvidia chips crucial for AI startups to train and run models, report the FT's Eleanor Olcott and Qianer Liu.

These companies have reserved the majority of their stockpiled AI processors, which have been barred for export to China by the Biden administration, for internal use and important clients.

In response, local governments across the country have pledged to provide "computing vouchers" typically worth between $140,000 and $280,000 to subsidize AI startups facing rising data center costs.

The vouchers, however, will not be able to help tackle the scarcity of foreign chips that is hampering their deployment across industries. To address this bottleneck, Beijing is expected to roll out a subsidy program for AI groups that use domestic chips, as it tries to ramp up efforts to displace foreign components.

Small dramas, big dreams

China's minidrama producers are looking to take their ultrashort episodes global with an eye to competing with streaming giants like Netflix, Nikkei Asia's Cissy Zhou and Marrian Zhou write.

This new genre, in which each episode is just one or two minutes long, has gained popularity in China, with many series going viral during the recent Lunar New Year holiday.

In addition to convoluted and melodramatic plots, producers have also thought up creative hybrid models for monetization, such as offering initial episodes for free and charging for later ones.

One example is ReelShort, an app owned by Beijing-based COL Group, a digital publisher backed by Tencent and Baidu. ReelShort has found the U.S. market particularly lucrative, representing almost 70% of total in-app purchase revenue for the platform since its launch in August 2022. The company initially adapted domestic minidramas with English subtitles but started to use actors and studios in Los Angeles several months later.

Pinning down a new market

Humane, a U.S. startup backed by Sam Altman, Microsoft and SoftBank, is entering the Asian market for the first time. The company is bringing its AI Pin, a voice-activated smart assistant worn on clothing, to Japan and South Korea.

The company unveiled the device and began taking pre-orders in the U.S. last November. It made a splash as the tech industry is looking for new ways for people to interact with electronics devices in the AI era.

Humane's co-founders Imran Chaudhri and Bethany Bongiorno spoke with Cheng Ting-Fang about how their company developed an operating system that can not only run on devices but also in cloud data center servers. The system is also designed to be "large language model agnostic," allowing it to link with as many LLMs as the users might need, not just OpenAI's GPT-4.