The Zhitong Finance App learned that Everbright Securities released a research report saying that on March 18-22, GDC 2024 will be held in San Francisco, USA, which is expected to attract the attention of the gaming industry and market. GDC covers a variety of cutting-edge game themes, and focuses on the trend of combining AI and other technologies with games. Domestic and foreign industry giants fully participated in showcasing their forward-looking research results in game technology, game planning & product case experiences, etc. 1) Pioneering new technology guides the development trend of the game industry, and is expected to open up room for imagination in the development of the industry. If the display exceeds expectations, it is expected to drive thematic trends in the game industry. 2) Case presentation and experience interpretation are expected to provide lessons for small and medium-sized manufacturers, provide positive effects in producing high-quality products, and thereby enhance the long-term growth expectations of the industry. Maintain the Internet media industry's “buy” rating.
Targets that are expected to benefit:
1) At the GDC conference, the focus was on Nvidia's display of ray tracing, AI NPCs, etc., on companies closely integrated with AI+ game themes, and on Palm Fun Technology (300315.SZ).
2) Tencent participated in the conference with “Operation Delta”, one of the key new products of 24 years. Leading manufacturers with advanced technology are expected to be the first to benefit. Tencent Holdings (00700) and NetEase - S (09999) are recommended.
3) I am optimistic about game companies with a solid 24-year pipeline and supported performance. Valuation is still low. Recommended: 37 Entertainment (002555.SZ), Perfect World (002624.SZ); follow: Shenzhou Taiyue (300002.SZ), Kaiying Network (002517.SZ), and Youzu Network (002174.SZ).
The main views of Everbright Securities are as follows:
Many tech giants from home and abroad participated in technology presentations and case sharing, which is expected to guide the development direction of the industry.
Microsoft: DirectSR “Super Resolution” technology adapts to the latest GPUs to optimize game rendering capabilities. We will introduce the progress of Azure cloud services in improving game development, building UGC communities, and optimizing game development workflows with AI.
Nvidia: There are many meetings on the agenda, and the topics are deep. The display of advances in ray tracing technology and AI NPCs is likely to exceed expectations. Launched a number of conference forums on ray tracing technology, including introducing the RTX Remix toolset and how to use path tracking in UE5, etc., to showcase its continuous iterative breakthrough and spread to more developers. It is hoped that: 1) Highly accurate rendering of the lighting and lighting effects in the scene to further increase the realism of the scene and enhance the experience of high-quality games; 2) gradually sink some technologies that require high computing power to enhance the industrial output capacity of the entire game industry. Learn how to create believable and engaging characters in a 3A gaming world through multiple sessions. The Audio2face tool integrates voice-driven AI facial animation into various tools and experiences. Intelligent NPCs comprehensively enhance the authenticity of NPCs and enhance players' sense of immersion in the game.
Unity: The technical route, rendering performance, etc. of Unity 6 will be explained in detail at the conference. The AI aspect introduced Muse updates to enhance current workflows and Sentis to provide a new dynamic experience on the user side.
Google: Introduces trends in combining AI and games from Google Cloud, Google Play, Labs AI, etc. Showcase Flutter, a high-performance cross-platform application development tool.
Tencent: Showcase the technical support behind several key games. It is recommended to focus on the development introduction of the cross-platform game “Operation Delta” in terms of integrated production pipelines, art pipelines, and tools. It was one of the key pipelines for 24 years.
NetEase: Thunderfire has been invited to speak at GDC many times, and its influence overseas is gradually increasing. It mainly focuses on sharing machine learning (ML) technology, and as a leading introduction to in-depth understanding of the operations of Chinese game studios, etc.
Global game industry trends in 24 years from the perspective of GDC research developers:
1) AI: AIGC continues to enter the game industry, but its penetration in technology such as program development still needs to be improved, and it is hoped to improve developers' workflows. 24M1 had 25% of the surveyed developers working in programs/engineering using AIGC tools, less than those working in commercialization & finance direction and operations/marketing/PR.
2) Game engines: Unity and Unreal Engine are still the most used by developers. 33% of 24M1 developers surveyed each said these two were their preferred toolset.
3) MR: The proportion of developers participating in VRAR games is relatively low (24M1 36% of the developers surveyed participated, and the proportion decreased year-on-year). Developers follow Meta, Steam, and Apple platforms.
4) Video adaptation of games: The trend is expected to continue, increasing the room for game IP monetization potential.
Risk analysis: regulatory risk, macroeconomic risk, risk of game performance falling short of expectations, risk of increased competition.