Hongkong – Jul 9, 2019 – China values 5G because it will drive many new applications in consumption, and there will be many applications in the industry in the future. 1G to 4G is mainly for consumer applications, while 5G should be expanded into industrial applications and penetrated all aspects including telemedicine, distance education, smart city, automatic driving and agriculture, etc. With WIMI Holographic AR’s listing of IPO in the United States, the global view on China’s 5G holographic AI vision will be changed? In the long run, the return on industrial applications may be greater than that for consumer-oriented applications, but it may still focus on consumption applications at the beginning of the 5G.
WIMI Hologram Cloud has the leading AR holographic application platform in China. According to Frost & Sullivan, WIMI Hologram Cloud is already the largest holographic AR application platform in China in terms of total revenue in 2017. In addition, WIMI established the most comprehensive and diversified holographic AR content library among all holographic AR solution providers in China. In terms of revenue, number of customers, holographic AR contents and the number of holographic AR patents and software copyright, WIMI Hologram Cloud ranks the first in the Chinese holographic AR industry. Throughout the year 2018, WIMI Hologram Cloud had approximately 4,654 AR holographic contents, 106 software copyrights and 219 technology patents. WIMI Hologram Cloud is dedicated to meeting the entertainment and business needs of customers and end users by its holographic technologies. According to Frost & Sullivan, the holographic AR application platform operated by WIMI Hologram Cloud covers the most extensive types of holographic AR products in China. The comprehensive platform application of WIMI Holographic Cloud is a key factor that distinguishes WIMI Hologram Cloud from its competitors.
WIMI Hologram AR’s holographic cloud published its IPO prospectus globally on June 27, 2019 in the United States. Its net profits exceeded 89 million yuan in 2018, making profits for two consecutive years. In the first quarter of 2019, the net profit increased by 68%, and the profit growth space has been opened. With the development of 5G holographic communication, WIMI Hologram AR’s holographic cloud, which was established only four years ago, is expected to be explosive in the future.
WIMI Hologram AR’s revenue comes from AR advertising service revenue and AR entertainment revenue. AR advertising services use the holographic materials and integrate them into advertisements on online media platforms or offline displays. When the relevant services are delivered according to the specific terms of the contract, WIMI will generate revenue.
AR entertainment revenue includes software development kit (“SDK”) payment channel services, software development, game services and technology development. When the user completes the payment transaction by SDK payment, relevant income will generate after deducting the payment to content provider. WIMI Hologram Cloud earns revenue from sales software development services.
The holographic AR industry value chain consists of three main parts. The upstream section refers to key hardware, software, services and providers and participants related to content production. The midstream participant is the provider of holographic AR solutions, integrating the upstream hardware and integrating software systems to form final products or solutions. The downstream refers to end-users, including governments, enterprises and household / individual consumers.
The business models of midstream and upstream participants are different. When hardware, software and service providers focus on R&D to further enhance their core technologies and reduce production costs, holographic AR device integrators and content creators must identify target users, build brand reputation and enhance the user experience. Some holographic AR device integrators have strong internal research capabilities, and play a role in the upstream and midstream markets, which is very common. WIMI Hologram Cloud is currently involved in the upstream segment, including the development of software, the provision of content production technologies and the creation and distribution of contents, as well as the midstream segment, that is, the provision of holographic AR solutions.
There are two types of holographic AR in advertising: volumetric 3D display technology and online APP. For example, Snapchat and Instagram have developed the AR filter ads featureing fast moving consumer goods (“FMCG”) and cosmetics. Another type of advertisement is a “plug-in” advertisement in a television show that promotes the products by manually adding a computer-generated 3D image to the original scene.
In 2016, China’s holographic AR advertising market size reached 900 million yuan, and it is estimated that the compound annual growth rate will be 71.8% in 2016 – 2020, and the compound annual growth rate will be 71.8% in 2020 – 2025 and will up to 143.9 billion yuan in 2025. In 2016, China’s holographic AR advertising market reached 900 million yuan. It is estimated the compound annual growth rate will be 71.8% in 2016 – 2020, and the compound annual growth rate will be 71.8% in 2020 – 2025 and will up to 143.9 billion yuan in 2025. This growth is mainly driven by the boom in the advertising industry and the new retail industry. As advertisers have been pursuing the most cutting-edge visual effects to attract customers, and AR applications in advertisements are constantly diversifying.
Entertainment: The first industry to adopt holographic AR applications is the entertainment industry. From the Hatsune Miku, the hologram of the late singer Teresa Teng, the heat of the Pokemon Go, the AR game, the holographic live convert, and the fashion show all warmly welcome the holographic AR.
In 2016, China’s holographic AR application market is 600 million yuan in entertainment industry. The compound annual growth rate is expected to be 83.5% in 2016 – 2020, and the compound annual growth rate is expected to be 92.8% in 2020 – 2025 and will reach 180 billion yuan in 2025. This growth is attributable to the increasing popularity of entertainment broadcasts, especially live broadcasts, including ceremonies, concerts, evening parties and sports events, where AR has great potential. In addition, the enhancement of live broadcasting capabilities brought by smartphone and other portable digital devices has contributed to this growth.
The development of 5G requires a process, just like that China has experienced six or seven years to develop 4G to the present sale. It will also take seven or eight years for 5G to cover the present scale of 4G in the future. It is predicted that by 2035, the world’s economic output will increase by 4% due to 5G, corresponding to the scale of 12.3 trillion U.S. dollars, and the global GDP in 2035 will also increase by 7% because of 5G. The analysis on China suggests that by 2035, China’s GDP will increase by about 1 trillion U.S dollars due to the development of 5G, driving about 10 million new employment positions. “This is not only for China, but for the United States.”
It is believed in the industry that holographic image communication utilizes the high-rate characteristics of 5G networks to transmit large amounts of 3D video signals, which can present a more realistic world for users, and it has a qualitative leap in interactivity and may become a subversive technology of Internet socialization. At present, Samsung, Facebook, Apple, Google, Huawei and other technology giants are involved in the R&D of technologies in this field, showing the broad prospects of the technology application. At present, the number of companies engaged in the holographic projection field in China has also greatly improved. According to statistics, there have been up to a thousand holographic projection companies, and the market capacity has also risen to 10 billion.
China values 5G because it will drive many new applications in consumption, and there will be many applications in the industry in the future. 1G to 4G is mainly for consumer applications, and 5G should be extended to industrial applications and penetrate into telemedicine, distance education, smart city, automatic driving, agriculture and other aspects. WIMI Hologram Cloud listed IPO in the United States, which will make the world to change its view on China’s 5G holographic AI vision applications.
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