A Chinese film industry project is set to spark debate after the country’s first fully AI-generated movie, “Linghun Baidu: Fusheng Meng”, was officially announced for release during the 2026 summer season.
The film is jointly produced by iQIYI and Changxin Media, and marks a major experiment in the popular “Linghun Baidu” franchise. Unlike previous productions, the entire cast is created using artificial intelligence, with no human actors involved in the performance process.
The story continues the franchise’s supernatural fantasy universe, following characters such as the “soul ferryman” Zhao Li, Xia Dongqing, and the Nine-Heavenly Maiden Wang Xiaoya as they deal with spirits and explore themes of life, death, and morality in a mythological setting.
Directed by Ding Kuan and produced by Guo Jingyu, the project is being positioned as an experimental attempt to expand Eastern supernatural storytelling using AI-driven production methods. However, the decision to rely entirely on AI-generated characters has triggered intense discussion within China’s entertainment industry.
The controversy deepened as producer Guo Jingyu previously criticised the use of AI actors, questioning why human performers should be replaced when real actors are available. His involvement in an AI-only production has led to accusations of inconsistency, although he later clarified that the project is intended as an “efficiency experiment” to explore AI’s role in intellectual property development rather than replacing human performers.
Public reaction has been divided. Some industry observers believe AI could expand creative possibilities for fantasy storytelling, enabling visually rich interpretations of mythological concepts such as the underworld and reincarnation. Others argue that AI-generated performances risk falling into the “uncanny valley,” lacking the emotional depth required to portray complex characters.
Meanwhile, AI-generated short dramas are rapidly expanding across China’s digital content market. Industry data suggests that AI-based productions have surged from around 7% of the top-ranked short dramas in 2025 to nearly 38% currently, with thousands of AI-generated episodes reportedly being produced daily.
Production costs have also fallen significantly, with AI short dramas now costing roughly 500 to 600 yuan (around RM325 to RM390) per minute, compared to previous costs of up to 3,000–4,000 yuan (approximately RM1,950–RM2,600) per minute for traditional productions.
AI technology has also reshaped production teams, reducing large crews of over 100 people to small groups of five to seven, with some projects even being handled by a single creator.
However, despite the rapid growth, industry insiders warn that the sector remains financially unstable, with an estimated 90% of companies operating at a loss. Many startups reportedly struggle with funding and sustainability, with some shutting down within months due to high pressure and limited returns, highlighting concerns that rapid production alone may not guarantee long-term success without strong storytelling foundations.
