Frost & Sullivan's Insights Large models are emerging from the pilot phase and entering the stage of large-scale implementation. In which scenarios or directions is this large-scale implementation mainly occurring? AI applications have entered the agent stage, but there are still no killer applications on the consumer side. Which will see faster adoption rates between the B-side and C-side? What are the characteristics of B-side implementation? Overall, what challenges remain for AI implementation? From the pilot phase to large-scale implementation, has the AI application reached a critical turning point? What are the criteria for judgment?   Li Qing, Director of Frost & Sullivan Greater China, was interviewed by Lookout Finance to discuss the key trends and industry variables in the transition of large models from pilot to large-scale implementation . Lookout Finance *Click on the end of the article Read the original article to view the complete report   Q: The report mentions that large models are emerging from the pilot phase and entering the stage of large-scale implementation. In which scenarios or directions is this large-scale implementation mainly occurring? Can you use digital human technology as an example to briefly describe the application situation, especially in terms of replacing real people and real-time interaction? What are the obstacles to the implementation of digital human technology? Li Qing Director of Frost & Sullivan Greater China   Large models are transitioning from the pilot verification phase to large-scale implementation, with their core value lying in 'improving quality and efficiency'. Currently, large-scale implementation is mainly reflected in several major scenarios: the highest proportion is 'question-answering enhancement', followed by 'code assistants', 'document processing generation', and 'intelligent customer service'. In addition, industries such as finance, government affairs, and manufacturing are also accelerating the deployment of RAG, industry agents, and digital employees. Currently, the core obstacle to technology implementation is no longer cost but higher-dimensional strategic and application challenges, with the most prominent being 'unclear application scenarios that can generate real value', followed by 'lack of relevant technical talent', 'difficulty in ensuring data security and privacy', and 'difficulty in integrating with existing business systems and workflows of enterprises'.   Digital human technology is being widely applied in scenarios such as customer service, virtual anchors, online education, and corporate image endorsements. In terms of replacing real people, it has achieved a high degree of natural voice, expression, and body movement simulation, especially in standardized and repetitive real-time interactions, where it is stable and efficient. Taking Alibaba as an example, its 'digital human' technology has formed a strategic combination of 'cloud capabilities + Taobao implementation'. At the technical level, Alibaba Cloud provides an open platform for virtual digital humans, supporting text and audio-driven generation, supplemented by a low-threshold free experience; at the business level, Taobao Live has opened public domain interfaces to service providers, which has promoted the launch of nearly a hundred digital human live streaming rooms and brought an average viewing increase of about 5 times. Combining with the platform's potential energy of breaking through 1 billion views during the 618 period, a year-on-year increase of 53%, digital human e-commerce and store broadcasts are accelerating their popularization. However, large-scale implementation of digital human technology still faces major obstacles, including how to balance generation quality and cost, break through technical bottlenecks driven by real-time, clarify ethical regulatory responsibilities, and establish user trust.   Q: AI applications have entered the agent stage, but there are still no killer applications on the consumer side. Which will see faster adoption rates between the B-side and C-side? What are the characteristics of B-side implementation? Overall, what challenges remain for AI implementation? (For example, factors such as model hallucination, application cost, effectiveness, and enterprise acceptance can be analyzed) Li Qing Director of Frost & Sullivan Greater China   B-side implementation shows clear characteristics: the focus of enterprise decision-making is shifting from 'pursuing the strongest single model' to 'seeking optimal solutions for specific business scenarios'. This means that the market has entered a new stage of 'value-driven' over 'technology-driven', with enterprises placing more emphasis on scenario fit and commercial value, and their needs evolving into 'flexible integration + technology autonomy and control' solutions to balance cost-effectiveness, flexibility, and security and controllability. In terms of implementation challenges, the biggest obstacle is 'unclear application scenarios that can generate real value', followed by 'lack of relevant technical talent' and 'data security and privacy' issues. It is worth noting that enterprise acceptance is also an obstacle, and 'high training and inference costs' are no longer the primary pain point, accounting for a low proportion.   Q: From the pilot phase to large-scale implementation, has the AI application reached a critical turning point? What are the criteria for judgment? Li Qing Director of Frost & Sullivan Greater China   Yes, AI application implementation has reached a critical turning point, transitioning from the pilot verification phase into a new stage of large-scale implementation. The main criteria for judgment are threefold: 1. First is the 'explosive increase' in call volume. In the first half of 2025, the average daily call volume of Chinese enterprise-level large models reached 1018.65 billion tokens, a surge of about 363% compared to the second half of 2024, marking the full release of market demand. 2. Second is the shift in market focus, with the industry transitioning from 'technology-driven' to 'value-driven', and market attention shifting from 'extreme performance competition' to 'equal emphasis on scenario fit and commercial value'. 3. Finally, the core pain points faced by enterprises have undergone a structural change, and enterprises have entered the 'deep water zone'. The main obstacles have shifted from high costs in the past to 'unclear application scenarios' and 'difficulty in system integration', indicating that enterprises have passed the technology trial phase and begun to face the challenges of deep integration.   Q: From the perspective of model call volume, what are the characteristics of the industry pattern? What factors determine model call volume? How significant are the impacts of factors such as open source and AI ecosystems? In the future, will there be an increasing focus on leading players like Alibaba, ByteDance, DeepSeek, etc.? If a latecomer wants to catch up, from which directions should they strive? Li Qing Director of Frost & Sullivan Greater China   From the perspective of model call volume, the industry pattern shows a highly concentrated feature, with the advantages of domestic manufacturers 'accelerating solidification'. Alibaba Tongyi (17.7%), ByteDance DouPao (14.1%), and DeepSeek (10.3%) together account for more than 40%. The key factors determining call volume lie in the ecosystem and differentiated strategies: Alibaba Tongyi relies on its 'integrated deployment capabilities' and the delivery closed loop formed by Alibaba Cloud's foundation and PAI platform; ByteDance DouPao transforms enterprise-level large model calls through rapid iteration and layout of application construction platforms such as Coze and HiAgent; DeepSeek quickly breaks through with high cost-effectiveness and open source compatibility. At the same time, the impact of open source and ecosystems is extremely profound, and open source is becoming the preferred path for enterprise model selection. Driven by TCO pressure and data sovereignty demands, up to 70% of enterprises plan to increase open source models more in the future.   Given the agglomeration effect of top talents, high capital investment barriers, and computing infrastructure barriers, the future market pattern is expected to further converge towards leading manufacturers. Latecomers face extremely high competitive barriers and find it extremely difficult to catch up. If they seek a breakthrough, they need to deeply cultivate in niche tracks, such as in private deployment operation and maintenance response capabilities, in-depth customization of industry solutions, and the accumulation of expertise in vertical fields to build differentiated advantages. *This interview has been published in Lookout Finance. The reporter is Liu Baodan, and the original title is: Baidu's AI Transformation, at a Critical juncture

AIIC2025 Liquor Industry Innovation & Investment Conference   From November 18th to 20th, the AIIC2025 Liquor Industry Innovation & Investment Conference was held at the Xiamen International Convention Center Hotel, bringing together global leaders in the liquor industry, innovators, and investment experts to discuss cutting-edge industry trends and practical cases. With the theme of "New Growth for All Things," the conference focused on new policy interpretations, supply-side changes, and consumer iterations under the unprecedented changes of the past century. It broke new ground with authoritative content and annual cases, breaking the gravitational trap of involution and building a sustainable new industrial order.   Wang Chenhui, Partner-in-Chief and President of Frost & Sullivan (Frost & Sullivan, abbreviated as "Frost & Sullivan") in Greater China, co-founder and President of LeadLeo, was invited to attend and provided an in-depth analysis of "Insights into the New Trends in Chinese New Beverage Consumption in 2025" from a professional perspective. Wang Chenhui, Partner-in-Chief and President of Frost & Sullivan Greater China, co-founder and President of LeadLeo Wang Chenhui, Partner-in-Chief and President of Frost & Sullivan Greater China, co-founder and President of LeadLeo   In his keynote speech, based on the research results of the LeadLeo Research Institute, Wang Chenhui systematically interpreted the industry development stages, growth drivers, consumption trends, and brand opportunities, providing forward-looking insights for the new beverage industry. He pointed out that the new beverage industry is moving from "category expansion" to "in-depth operation," with the industry structure, consumption paths, and innovation models undergoing reshaping.   Wang Chenhui began with changes in growth logic. He stated that the past reliance on "internet celebrity momentum" and "light asset models" for growth is no longer effective, and the industry has entered a new stage centered on "supply chain capabilities, product research and development capabilities, and channel capabilities." Current industry competition has shifted from "short-cycle hits" to "long-term operational capabilities," with brand growth characterized by "longer time windows, stronger organizational capabilities, and more emphasis on supply-side construction." Since 2020, the market scale of new beverages in China has continued to expand, with the Z generation becoming the main consumer group. Healthy drinking, cross-border flavor innovation, and the export of national trend culture have become important trends, with sub-categories such as fruit wine and craft beer growing rapidly.   Regarding industry trends, Wang Chenhui highlighted "key challenges to industry transformation." He pointed out that new beverage companies still bear high costs in inventory management and logistics transportation, making it difficult to quickly respond to market demand. At the same time, instant retail has become a new growth engine, and the rapid improvement of online channels is driving industry restructuring. Online channels have become an important source for consumers to purchase beverages, with consumers showing a significant preference for "online purchases" in surveys, further blurring the boundaries between offline and online channels.   Moving on to industry-level trends, he pointed out that with changes in technology and consumption scenarios, beverage companies need to focus on "cross-border collaborations," "emotional value consumption," and "low-alcohol innovation." Among them, integrated innovations represented by "punk health" products are forming an important choice for young consumers. In terms of flavor, according to the research of the LeadLeo Research Institute, 75% of respondents prefer a "milk + wine" blend flavor, and 86.4% prefer a "tea + wine" blend flavor. These data reflect the growing demand for soft-tasting and more pleasant swallowing experiences among young users.   When discussing the external environment for industry development, he emphasized the "going global trend." According to the data of the LeadLeo Research Institute, China occupies an important share of the global spirits market, with Chinese liquor accounting for 24.9% of the global spirits market in terms of sales (2025E). However, in comparison, the global penetration rate of new beverage categories is only 0.3%, still in an extremely early stage. He stated that in the future, Chinese beverage brands have the potential to enter international markets in terms of supply chain stability, product standardization capabilities, and brand cultural expression.   In his consumer insights, Wang Chenhui pointed out that the low-alcohol consumption base in densely populated areas along the eastern coast is good for driving future growth in the new beverage market; consumers at all levels of cities prefer new beverages with flavors and taste, with first-tier cities valuing cost-effectiveness more; in terms of marketing methods, third-tier cities adapt to the "intimate economy" model. He further pointed out that Chinese new beverage users are showing an obvious structural stratification. Among them, "freedom drinkers" have an average monthly disposable income of 9,393.9 yuan, with a monthly alcohol expenditure of about 527 yuan, where emotional value and self-regulation become their main drinking motivations; "urban self-indulgent people" are more sensitive to "new flavors, light burdens, and visual design"; "time-honored drinkers" pay more attention to comfort and stable experiences. These differentiated profiles are determining the future product layout and communication direction of brands.   At the end of his speech, Wang Chenhui summarized that the Chinese new beverage industry is moving from "rapid development" to a growth stage of "stable quality." For companies to truly grasp the future, they need to find new balance points between product innovation, supply chain restructuring, consumer insights, and channel deepening. He believes that the industry will welcome new growth opportunities during the process of structural reshaping.

Currently, innovation is refreshing the world's face at an unimaginable pace. The drastic changes and driving forces it brings have gone beyond the conventional business domain, and are accelerating the global future development at the level of cultural imagination and social context.   The core driving force behind this process comes from the 'pioneers' of all industries—never before has there been such an astonishing spectacle: under the relentless upgrade of computing power, AI has profoundly subverted the production logic that has lasted for thousands of years; new energy and energy storage have broadened the runway for the next wave of productivity; the iterative efficiency of product, service, and business paradigms has accelerated the depreciation of all lifestyles and ways of thinking; business leaders occupy an absolute 'seat at the table,' where a press conference or a speech can shock the world—under their combined influence, innovation is not only a business tool but has become an unshakable 'world rule' and 'global approach,' and their own value has far exceeded the narrow definition of business leaders.   As a result, the semantic distinction between leaders and innovators is becoming increasingly blurred. Whether it is the leader's ecological niche that dominates the industry's innovation direction, or emerging innovators who suddenly become industry leaders, innovation has become one of the core elements considered first by Forbes China when presenting various business insights.   Against this backdrop, the globally renowned growth consulting firm Frost & Sullivan (Frost & Sullivan, abbreviated as 'Frost & Sullivan') and Forbes China jointly launched at the end of last year the first selection of the Forbes China Industry Development Pioneer Awards, a series of authoritative business observation practices covering multiple key areas with an emphasis on innovation impact and value.   Building on the success of last year's selection, which received widespread attention and influence, both parties have recently launched the 2026 Forbes China Industry Development Leaders Selection. This selection focuses on key areas such as AI technology, big consumer goods, healthcare, new energy, manufacturing, and service industries. Through rigorous data analysis and in-depth market research, it aims to identify and commend industry pioneers who have a wide influence and innovative spirit both domestically and globally.     Both Frost & Sullivan and Forbes China are industry-leading institutions with a global perspective, and they have long been deeply involved in the Chinese market. Frost & Sullivan provides global capital markets and corporate consulting services, integrating 64 years of global consulting experience. Over the past 27 years, they have dedicated themselves wholeheartedly to serving the booming Chinese market, helping more than 10,000 clients accelerate their business growth with a global perspective. It is reported that Frost & Sullivan's Greater China region has accumulated over 10,000 original industry research reports and white papers, covering 19 core national economic industries and more than 6,000 sub-markets with a strong knowledge base. The research data of Frost & Sullivan is widely recognized in the global capital markets.   This renewed collaboration between Frost & Sullivan and Forbes China brings together the two parties's top resources and professional teams in industry research and media communication. It will provide strong support and assurance for the second Forbes China Industry Development Pioneer Awards and continue to create a benchmark with high authority and influence.     Eligibility Details Award Settings   Main selection   Forbes China Industry Development Pioneer   Sub-selection   Forbes China's Leading Companies in Industry Development Forbes China's List of Innovative Brands in Industry Development Forbes China Industry Development ESG benchmark Forbes' Benchmark of AI Enterprise Services in China's Industry Development Forbes China's Emerging Industry Analyst       Main selection   Forbes China Industry Development Pioneer       1 Selection criteria   Candidates should be from key sectors such as AI technology, mass consumption, healthcare, new energy, manufacturing, and services;   Candidates should be industry pioneers with a good reputation and high visibility across various industries, including but not limited to corporate executives, founders/co-founders, analysts, experts, and scholars;   The candidate's career achievements must meet one of the following four conditions: The market value/valuation of the candidate's company is at the level of over 3 billion, and it must have been operating continuously and stably for more than three years; The candidates have been recognized by top international or domestic scientific research institutions and have made outstanding contributions to leading industry innovation; The candidate leads the enterprise to achieve the first market share in the industry and has the sustainable growth ability to maintain its industry position (*An industry research report issued by an authoritative institution and an industry position ranking table are required to be submitted).   2 Selection dimension   Self-growth trajectory Industry Empowerment and Leadership Enterprise operational capability Innovative response capabilities Future Vision and Planning       Sub-selection   Forbes China's Leading Companies in Industry Development Forbes China's Innovative Brands in Industry Development Forbes China Industry Development ESG Benchmark Forbes' Benchmark of AI Enterprise Services in China's Industry Development       1 Selection criteria   Candidates should be from key sectors such as AI technology, mass consumption, healthcare, new energy, manufacturing, and services;   Candidates should be industry pioneers with a good reputation and high visibility across various industries, including but not limited to corporate executives, founders/co-founders, analysts, experts, and scholars;   The candidate's career achievements must meet one of the following four conditions: The market value/valuation of the candidate's company should be at the level of 3 billion RMB or above, and it must have been operating continuously and stably for more than three years; The candidates have been recognized by top international or domestic scientific research institutions and have made outstanding contributions to leading industry innovation; The candidate has led the enterprise to achieve the first market share in the industry and has the sustainable growth capability to maintain its industry position ( *An industry research report issued by an authoritative institution and an industry position ranking table are required to be submitted   2 Selection dimension   National strategic response Innovation performance Business growth potential sustainable development capacity Industry influence       Sub-selection   Forbes China's Emerging Industry Analyst       1 Selection criteria   01. Basic evaluation criteria (All must be met)   Focus on industry areas: The research or content output of candidates should concentrate on one of the key sectors such as AI technology, mass consumption, healthcare, new energy, manufacturing, and services.   Public Influence: It is necessary to have publicly verifiable research achievements or content publishing channels (such as media columns, industry platforms, research reports, video accounts, official accounts, Zhihu, X, LinkedIn, etc.).   Good reputation: The candidate has no academic misconduct, data fraud, or negative business reports in the past year.   02. Achievement Metrics (Match any 2 of the following conditions)     Industry influence The cumulative number of views (reads) for industry analysis content (reports, articles, videos) published within the past year is ≥100,000; Or reposted, cited by mainstream media/institutions >3 times; Or have given keynote speeches/talking rounds at well-known conferences/forums.   Social influence Have ≥10,000 followers on any content platform;   The academic, technology or industry community leads with over 500 members actively operating the community; Organized or presided over industry-themed sharing events at the university level or above.   Innovation of research results Has released original industry models, data analysis methods, and prediction frameworks; Or drive a topic into the mainstream industry discussion through original research (such as ESG, AI-native, new consumer trends, etc.). As a core member, participated in innovative projects (such as participating in national business competitions, including but not limited to industry research competitions and innovation and entrepreneurship competitions), scientific research mentor projects, or related research topics; Has proposed original analytical models, research methods, or solutions in projects and received recognition from instructors or institutions; Possess a portfolio of personal project works related to the field (such as data analysis reports, business plans, product prototypes, in-depth evaluations, etc.).   Professional recognition Obtain citations, collaborations, or certifications from leading institutions (consulting firms, investment banks, media, research institutions); Has won industry media awards, research competitions, and honors for young scholars.   Growth potential and social impact Have a continuous output plan (such as series analysis or research columns); Or there may be practical impacts in driving the industry's youth group to learn/share (such as communities, open courses, podcasts, etc.).   The candidate enterprises must meet the following requirements The company's operating income for the previous fiscal year must have come from Mainland China, accounting for 51% or more; The corporate headquarters must be located in Mainland China; The enterprise has been operating stably for more than 3 years; The enterprise had no major labor disputes or safety accidents in the previous year;   2 Selection dimension   Industry development perspective Logical framework construction capability Multi-source data integration capability Forward-looking analysis of transformation capabilities     About Forbes China   Forbes was founded in New York in 1917, with the slogan 'Entrepreneurship, a tool for creating wealth', and has become a leader in the industry with its entrepreneurial spirit and innovative awareness. The lists produced by Forbes are known as the 'barometer of the economy' and the 'wind vane of wealth'. In 2003, Forbes officially entered the Chinese market.   As a business media brand centered on innovation, Forbes China adheres to the DNA of 'entrepreneurship, innovation, and wealth creation.' Leveraging its long-term observation and research on high-net-worth individuals, entrepreneurs, technology, investment, health, lifestyle, and other fields, it has launched a series of lists and content that have a significant impact on the economy and society. The fairness and impartiality of Forbes China's lists make it a benchmark in various fields, and its insightful content provides readers with multi-dimensional information references, thereby inspiring entrepreneurs and business elites to create more wealth and business value. At the same time, Forbes China is committed to building an enterprising interactive community for high-end clients, providing a forward-looking and shared environment, and constructing an information ecosystem for entrepreneurship and innovation. About Frost & Sullivan (Frost & Sullivan)   Frost & Sullivan (Frost & Sullivan, abbreviated as 'Frost & Sullivan') integrates 64 years of global consulting experience. Over the past 27 years, it has dedicated itself to serving the booming Chinese market. With a global perspective, it has helped over 10,000 clients accelerate their business growth, assist them in achieving growth, innovation, and leading benchmarks within their industries, and realize capital operation goals such as financing and listing.   Frost & Sullivan is deeply involved in global capital markets and corporate consulting services. By innovatively introducing 'Total Investment Management (TIM)', it provides comprehensive investment and financing as well as various other professional consulting services for enterprises, including investment and financing CDD, valuation services, technology advisor, financial advisor, ESG, fundraising and investment feasibility studies, bond issuance industry advisor, industry advisor, assessment services, award services, industry white papers, strategic and management consulting, planning consulting, technical insights, etc.   Frost & Sullivan's investment and financing business in China has achieved full industry coverage of China's national economy, including a high level of attention to all economic hotspots such as the new economy and new infrastructure. It covers digital infrastructure, consumer electronics, dual-carbon new energy, healthcare and life sciences, catering and new retail, semiconductors and integrated circuits, smart homes, automotive and mobility, health care services, food and beverages, information and communication technology, fintech, real estate and property management, mining and smelting, beauty and fashion, big data and artificial intelligence, logistics and supply chain, construction technology and decoration, special new materials, culture and entertainment, enterprise-level services, cross-border e-commerce trade, infrastructure construction, environmental protection and energy-saving technology, education and training, etc.   Since the Frost & Sullivan team began providing investment and financing advisory services to corporate leaders and their management teams, it has helped nearly 3,000 companies successfully list on the Hong Kong and overseas stock markets. It is a leading enterprise in the field of investment and financing strategy consulting in China. Over the past decade, Frost & Sullivan has ranked first in market share for professional industry consultants assisting Chinese companies in listing on the Hong Kong and overseas stock markets for consecutive years. In recent years, Frost & Sullivan reports have also been widely cited in the prospectuses of leading A-share and STAR Market listed companies, as well as primary and secondary market research reports and other capital market announcements.   For over 64 years, Frost & Sullivan has helped a large number of clients (including Fortune Global 1,000 companies, top domestic and international financial institutions, and other leading enterprises) achieve strategic goals through its nearly 50 offices around the world. Leveraging a powerful database and expert network, as well as rich professional knowledge and consulting tools, the firm has completed tasks including but not limited to due diligence, valuation analysis, and third-party evaluations. It has also created a series of market position research tools and methodologies, innovatively introduced the 'FSBVFrost & Sullivan Brand Value Model', and provided market position research and brand value assessment services to over 1,000 enterprises, continuously helping a large number of Chinese brands achieve domestic and overseas growth strategies.

Insights from Frost & Sullivan Price wars are the main theme of the ready-to-drink tea industry in 2024, reflecting a phase shift from rapid growth to competition for existing market share. In 2025, subsidies from food delivery platforms further pushed down the prices of ready-to-drink tea into extremely low ranges. However, using price to gain traffic is not a long-term strategy. As the concept of new tea drinks becomes less novel, ready-to-drink tea has begun to transition from an incremental market to a saturated one. In the future, whether ready-to-drink tea brands can widen the gap with their peers in terms of supply chain, health concepts, and brand mentalities will be key to success. From the perspective of supply chain capabilities, is the trend of the ready-to-drink beverage industry more likely to reflect product differentiation or homogenization? What is the underlying driving logic? What types of beverages are consumers more likely to drink? Brands like Starbucks and Bawang Tea Girl adhere to a strategy of focusing on value rather than price. In what other core dimensions may competition continue in the ready-to-drink beverage industry in the future?   Lu Siyi, consulting manager for Frost & Sullivan Greater China, was interviewed by CBN magazine to discuss how tea brands should focus their efforts in the next phase. CBN magazine *Click on the end of the article Read the original article for a complete report     Q: From the perspective of supply chain capabilities, is the trend of the ready-to-drink beverage industry more likely to reflect product differentiation or homogenization? What is the underlying driving logic? What types of beverages are consumers more likely to drink? Lu Siyi Consulting Manager for Consumer Industry at Frost & Sullivan Greater China   My view is that the development of the supply chain in the ready-to-drink beverage industry is undergoing an evolution from 'having' to 'excellent' and then to 'unique'.   Basic supply chain capabilities are gradually becoming industry standard, especially for leading companies, but on the other hand, this may indeed lead to homogenized competition in mid-range products; however, through deep integration and innovation of the supply chain at the source level using technology, it will become the core key for leading brands to build true differentiation and win the market.   Overall, supply chain and product innovation are not contradictory. The focus of the supply chain is to improve efficiency, ensuring cost efficiency during product updates and iterations. As leading brands build their strong supply chains, it will indeed have a significant impact on small brands in terms of costs, which is an inevitable law of industry development. Some distinctive brands may still create some explosive products and new features in the future, but due to a lack of supply chain capabilities, if they cannot monopolize raw materials and other links, it is inevitable that large brands will use their supply chain advantages to launch similar products.   At the same time, we believe that when considering this issue, it is worth noting what consumers' needs are, whether they are for continuous differentiated products or after finding their favorite products, focusing on these signature products. We also see that some specific brands' strategy is to focus on their core flagship products and not innovate for the sake of innovation, but they can still attract a loyal core consumer base.   The underlying driving logic behind this is mainly divided into two parts.   Internally, it is driven by efficiency and cost. Industry competition has shifted from the number of stores to single-store profitability and operational efficiency. A complete supply chain is the foundation for reducing costs and increasing efficiency while maintaining quality, which will inevitably lead to convergence in basic capabilities;   Externally, it is driven by the upgrading of consumer demand. Consumers pursue healthier, fresher, more diverse, and more experiential beverages. This forces brands to trace upstream. To meet these advanced needs, they must rely on differentiated supply chain capabilities.   Therefore, based on the trend of supply chain evolution, consumers will not only be more likely to drink basic beverages with stable quality and high cost-effectiveness in the future, but they will also have the opportunity to taste more unique, healthy, and experiential new beverages brought about by deep supply chain innovation. Referring to the coffee industry, after the integration of specific origin labels and special fruits, it is still expected to become one of the representative directions of industry innovation.   Q: Consumers are increasingly concerned about 'drinking healthily'. In the future, will ready-to-drink beverages lean more towards using 'natural raw materials' or 'industrialized raw materials'? Lu Siyi Consulting Manager for Consumer Industry at Frost & Sullivan Greater China   From industry observation, the choice of raw materials for ready-to-drink beverages in the future is not simply a binary choice but moving towards a new stage of deep integration of 'natural value orientation' and 'industrial technology empowerment'. Using industrial technology to ensure efficient supply of natural raw materials represents the development direction of the industry.   Consumers' pursuit of health functions has made natural raw materials an unshakable value core. We see that 'real milk and real fruits', ingredients that are both food and medicine (such as goji berries), and the concept of sugar reduction have become key to brand competitiveness. Behind this is consumers' high sensitivity to ingredient transparency and health attributes.   However, pure agricultural product forms are difficult to meet the stringent requirements of brands at the store level for stability, efficiency, and scale. Therefore, the industry is leveraging advanced food industrial technology to achieve industrialized expressions of natural raw materials. For example, through technologies such as freeze-drying and modern extraction, high-quality fresh fruits and tea are transformed into standardized raw materials (such as freeze-dried tea powder and cold extract) that are stable in flavor, convenient for transportation, and storage. This not only retains natural flavors and nutritional components but also ensures consistency and efficient operation across thousands of stores. Ultimately, consumers will enjoy beverages with both health attributes, stable taste, and innovative flavors. The winners in the future will be those brands that can maximize the presentation of natural raw material values using industrial technology.   Q: Since February this year, coffee futures prices have experienced a trend of first soaring, then correcting, and maintaining high levels. Will consumers face price increases when buying ready-to-drink coffee in the future? Lu Siyi Consulting Manager for Consumer Industry at Frost & Sullivan Greater China   Looking at the current dynamics of the futures market and the industry side, consumers will indeed feel a certain pressure of price increase when buying ready-to-drink coffee in the future, but currently, there has been no widespread increase.   The factors behind this are as follows:   Firstly, cost pressure continues to be transmitted. Coffee futures prices reached a high at the beginning of 2025. Although they have recently corrected, affected by the climate and planting cycles of major global producing areas, the medium- and long-term cost center of coffee beans has been raised, making it difficult to return to the pre-increase price level in the short term   Secondly, there is price differentiation among different types of brands. Leading brands with strong supply chains and long-term agreements (such as Luckin Coffee and Starbucks) will buffer the pressure through large-scale procurement and digital operations. At the same time, considering their huge store and consumer base scales, an obvious price increase may have an impact on sales, and these brands tend to make invisible price adjustments, such as reducing discount intensity or guiding consumers to new products with higher profits. However, for small and independent coffee shops with limited procurement scales, a direct price increase may be the most direct means of survival.   Therefore, consumers may find in the future that they will have fewer opportunities to enjoy extremely affordable (below 10 yuan) freshly ground coffee, but the price increases for mainstream products in the general market range are controllable; while paying a higher premium for specialty coffee or special blends with high-quality beans or complex ingredients will become more common, and the prices of niche specialty coffees may experience a certain degree of increase.   Q: Brands like Starbucks and Bawang Tea Girl adhere to a strategy of focusing on value rather than price. In what other core dimensions may competition continue in the ready-to-drink beverage industry in the future? Lu Siyi Consulting Manager for Consumer Industry at Frost & Sullivan Greater China   My view is that the competition in the ready-to-drink beverage industry in the future will completely transcend simple price wars and turn into a value war across four core dimensions: deep supply chain, cultural innovation, global layout, and digital operations.   Firstly, the supply chain is the foundation: The focus of competition has upgraded to source locking of high-quality raw material producing areas globally and extreme optimization of distribution efficiency and freshness, which determines the upper limits of quality, cost, and stability.   Secondly, product innovation needs to be combined with cultural empowerment. Successful new products in the future need to deeply integrate regional culture or provide clear health functions (such as probiotics and natural herbs) to provide consumers with emotional and value experiences that go beyond thirst quenching.   Furthermore, brand globalization. Going global is also an output of cultural soft power. Brands need to choose a differentiated path, such as Bawang Tea Girl creating an Eastern aesthetic space in high-end markets in Europe and America, deeply binding their brand image with the East, and supporting positioning and premium through the brand.   Finally, there is digital competition. Through AI and big data for precise operations, marketing through digital tools, product innovation guidance, and building a private domain traffic pool for the brand to improve repurchase rates and product competitiveness.   Q: How do new tea drink brands mobilize consumer emotions? Which strategies are effective and which are likely to fail? Which are long-term mental strategies and which are short-term strategies? Lu Siyi Consulting Manager for Consumer Industry at Frost & Sullivan Greater China   My view is that the core of new tea drink brands in mobilizing consumer emotions is to upgrade from 'function satisfaction' to 'emotional resonance'. Whether a strategy is effective or not depends on whether it is sincere and systematic.   Effective emotional mobilization is rooted in an excellent product experience, a resonant cultural narrative, and a user relationship that is treated sincerely. Brands need to become 'value co-creators' and 'cultural interpreters'.   Short-term effective strategies usually involve creating immediate surprises and social topics of conversation, such as limited-time collaborations with popular film IPs or celebrities, launching high-profile peripherals, or launching viral challenges. However, if these strategies are executed improperly, such as marketing without supply chain support, rigid collaborations that do not match the brand's tone, and short-term price wars that damage brand value, they are very likely to fail and even backfire on the brand.   The strategy that can truly settle users and build a long-term brand mentalities is to internalize emotional value as part of the brand. This is reflected in three aspects: First, the product is emotion, such as through unique naming (such as 'Bo Ya's Farewell'), healthy concepts (without trans fats), and familiar flavors (such as nostalgic gardenia flowers), making the product itself a soothing, confident, or healing emotional carrier. Second, cultural resonance, where the brand becomes a symbol for consumers to express their cultural identity and self-identity. Finally, user co-creation, sincerely listening to feedback and quickly iterating (such as Bawang Tea Girl launching the low-cause series of teas according to user demands), establishing a sense of belonging where consumers are valued and maintaining a high repurchase rate through long-term strategies to win hearts.   *This interview has been published in CBN magazine, with reporter Lu Yanjun, and the original title is: Ready-to-Drink Tea: The Future's Competition Lies in Strong Supply Chains, Healthy Concepts, and Emotional Resonance

Frost & Sullivan insight What is the overall scale and development stage of the current Chinese beverage industry? What proportion does juice account for in it? What role does it play? What is the overall scale of the current Chinese pure juice (including FC and NFC) market? What changes have taken place in the competitive landscape of this market over the past few decades? What is the expected compound growth rate of the juice category in the next few years? How should this track be defined? For juice brands, which part should be emphasized more in building upstream and sales channels? Is it necessary and essential for brands to invest heavily in upstream construction?   Executive Director Cai Jinfeng of Frost & Sullivan Greater China, interviewed by Southern Weekend, discussed the upgrade of the juice industry and the structural growth opportunities for pure juice . Southern Weekend *Click on the end of the article Read the original article for a complete report   Q: What is the overall scale and development stage of the current Chinese beverage industry? What proportion does juice account for in it? What role does it play? Cai Jinfeng Executive Director of Frost & Sullivan Greater China   In recent years, the overall scale of China's soft drink industry has continued to expand, growing from about 986.7 billion yuan in 2020 to about 1,206.6 billion yuan in 2024. Currently, China's soft drink industry has entered a new stage of structural upgrade and quality improvement from a rapid growth phase, with consumers' demand for healthy, natural, and functional beverages significantly increasing.   As an important segment of the beverage industry, as of 2024, the market size of Chinese juice was about 158.4 billion yuan, accounting for about 13% of the overall soft drink market. In recent years, the juice category has also been improving quality and upgrading simultaneously, with significant growth in the pure juice category. Juice in the soft drink market is gradually shifting from a "quenching" beverage to a "healthy and nutritious" beverage, playing the role of representing consumption upgrade and quality life.   Q: What is the overall scale of the current Chinese pure juice (including FC and NFC) market? What changes have taken place in the competitive landscape of this market over the past few decades? Cai Jinfeng Executive Director of Frost & Sullivan Greater China   In 2024, the market size of Chinese pure juice (including FC and NFC) was about 36.7 billion yuan, accounting for about 23% of the overall juice market. Over the past few decades, the pure juice market has evolved from being dominated by foreign investment to a rise of domestic brands and then to a diversified competitive landscape.   In the early days, the Chinese beverage market was mainly composed of soda beverages and fruit-flavored beverages. At the beginning of 1986, local Chinese juice brands began to emerge, such as Coconut Tree Coconut Juice and Tianjin Orange Treasure Orange Juice, symbolizing the vigorous development of the domestic juice industry. After 1990, local brands such as Huiyuan and Nongfu Spring rapidly expanded through channel penetration and cost-effective strategies; in addition, Cool Kids, Unifree Fresh Orange Multi, and Meiji Juice also actively laid out their markets on the Chinese mainland; since 2010, with the continuous upgrading and popularization of sterilization technology, brands such as Weiquan, Zero Degree Fruit House, and Daily Fresh have promoted high-end upgrades, presenting a dual-track parallel pattern of "FC popularization and NFC high-endization" in the market. Currently, the market has gradually shifted from single-price competition to comprehensive competition in terms of quality, technology, and brand experience.   Q: For example, what is Huiyuan's market share in the pure juice segment? Compared with competitors such as Weiquan and Nongfu Spring, what are its strengths and weaknesses? Cai Jinfeng Executive Director of Frost & Sullivan Greater China   Huiyuan still occupies a relatively leading position in the mid- to high-concentration juice and FC pure juice markets. At the supply chain end, Huiyuan has an integrated ability from planting to production and processing, and has a first-mover advantage in the layout of upstream fruit planting. In terms of product dimension, Huiyuan has a comprehensive coverage of juice concentration and taste in the juice track, but its production method is single, mainly concentrated and reduced; Huiyuan's juice products are mostly single-branded, with competitive unit retail prices, rich juice categories, and a wide price range, but the application and development process of new technologies is relatively slow, failing to quickly capture the trend of consumption upgrade;   In terms of channel structure, Huiyuan's online channels and CVS channels are inferior to competitors such as Nongfu Spring and Unifree, mainly relying on the comprehensive operation of dealers' KA supermarkets and direct company channel layout. At the marketing strategy level, Nongfu Spring, Weiquan, etc. have established relatively mature brand and channel coverage in the market, with obvious marketing and channel expansion, but Huiyuan's marketing activities are relatively conservative, and its layout in the new retail and convenience store system is weak.   In contrast, Weiquan's refrigerated FC series products have quickly established a reputation among urban white-collar consumers through convenience store scenario layout; Nongfu Spring has successfully captured the high-end market with its "100% NFC" series and full-channel marketing, and is better at brand rejuvenation and product creation.   Q: What is the expected compound growth rate of the juice category in the next few years? How should this track be defined? Cai Jinfeng Executive Director of Frost & Sullivan Greater China   It is expected that from 2024 to 2029, the annual compound growth rate of the Chinese juice market will remain at a low single-digit growth rate, but the growth rate of the pure juice category is expected to reach nearly 10%, significantly higher than the overall industry.   We define the juice track as a "structural growth track driven by health upgrade". It is no longer a traditional soft drink branch, and the consumption of low-concentration juice will continue to decline; in order for the juice market to integrate high-potential categories such as healthy consumption, quality life, and diversified scenario combinations. Future growth mainly comes from increased consumption frequency, price increase, and diversified categories.   Q: For juice brands, which part should be emphasized more in building upstream and sales channels? Is it necessary and essential for brands to invest heavily in upstream construction? Cai Jinfeng Executive Director of Frost & Sullivan Greater China   Today's juice production technology has become increasingly mature, but strict control over raw materials and the adoption of more advanced production processes remain the competitive advantages of current mainstream brands. Upstream construction is a "necessary but not sufficient" condition, which ensures product differentiation and supply chain security, but without strong channel and brand capabilities, it is difficult to achieve large-scale commercial success. Therefore, we believe that the "strong upstream control + wide channel coverage + strong brand awareness" three-wheel drive will be the most core competitiveness of brands. *This interview has been published in Southern Weekend, with reporter Mei Ling, and the original title was: 'Loving Each Other and Killing Each Other' with Capital - Huiyuan's Repeated Battle with Major Shareholders

Insights from Frost & Sullivan On September 8th, the Hangzhou Economic and Information Technology Bureau publicly solicited opinions on 'Several Opinions (Draft for Soliciting Comments) on Accelerating the Integration of Technological Innovation and Industrial Innovation to Promote the High-quality Development of Hangzhou's Manufacturing Industry'. The draft proposes that by 2030, the scale of the core AI industry should reach 600 billion yuan, with over 1,000 enterprises above designated size. Will the demand for domestic substitution of AI chips accelerate in 2025? Is the main direction of substitution towards the inference end or the training end? What is the potential market for domestic AI computing power chips in the next three to five years? How large will it probably reach?   Tran Cui, Executive Director of Frost & Sullivan Greater China, was interviewed by Times Weekly to discuss the domestic substitution of AI chips and future market potential. Times Weekly *Click on the end of the article Read the original article for a complete report     Q: Will the demand for domestic substitution of AI chips accelerate in 2025? Is the main direction of substitution towards the inference end or the training end? Tran Cui Executive Director of Frost & Sullivan Greater China   From the current industrial and policy environment, it is very likely that the demand for domestic AI chip substitution will enter an accelerated phase in 2025. There are three reasons:   First, the international environment remains uncertain, and the security of the computing power supply chain has become a consensus in the industry, with domestic manufacturers and application enterprises having an urgent need to strengthen their autonomy and control.   Second, the implementation of domestic AI applications is expanding, whether it is the deployment of large models on the enterprise side or the application of generative AI on the consumer side, both driving larger-scale computing power demand.   Third, the technical capabilities and ecological adaptability of domestic chip manufacturers have significantly improved in the past two years, and they are already ready to undertake larger-scale applications.   As for the direction of substitution, the inference end will be substituted faster in the short term. Inference scenarios have higher requirements for chip cost-effectiveness, energy efficiency ratio, and ecological adaptability, and domestic manufacturers can already provide competitive solutions in these dimensions. At the same time, the domestic application market is vast, providing opportunities for rapid iteration. The substitution of the training end is also advancing, but due to the involvement of software frameworks, ecological compatibility, and the stability verification of large-scale computing power clusters, the progress will be more steady and may require a longer time window.   Q: What is the potential market for domestic AI computing power chips in the next three to five years? How large will it probably reach? Tran Cui Executive Director of Frost & Sullivan Greater China   In the next three to five years, the market space for AI computing power chips in China will be very large, mainly due to the following reasons:   First, the breadth and depth of the demand side are continuously expanding. Large models are gradually becoming the infrastructure for industrial intelligence, not only with internet companies increasing their investment but also traditional industries such as finance, energy, manufacturing, and healthcare actively exploring AI applications. This means that the long-term demand for inference and training computing power will remain high.   Second, dual-driven by policy and capital. At the national level, it has been clearly stated that an autonomous and controllable computing power system should be built, and local governments are also promoting the construction of intelligent computing power centers. At the same time, the capital market's investment enthusiasm for AI computing power has not diminished, creating an environment for the accelerated maturity of the industrial chain.   Third, ecological factors are gradually improving. With the continuous progress of domestic chips in hardware performance, software stack compatibility, and developer ecosystems, the adoption threshold for application enterprises is gradually decreasing, and the conditions for chip large-scale implementation are maturing.   Therefore, in the next three to five years, the domestic AI computing power chip market will not only grow rapidly in scale but more importantly, AI computing power chips will become one of the most strategically significant links in the entire AI industrial chain. *This interview has been published in Times Weekly, with reporter Zhu Chengcheng, and the original title was: Alibaba, DeepSeek Launch Successive Moves, Will Hangzhou's AI Industry Reach 600 Billion in Size within Five Years? Huawei's chip roadmap announced, Ascend Kunpeng advancing side by side! Xu Zhijun: The world's strongest super-node will be launched in the fourth quarter of next year

At a time when the AI industry is experiencing frequent technological breakthroughs, "AI companionship" is becoming a new track that is being bet on by capital, entrepreneurs, and industry giants alike. How can we judge the overall popularity of the current AI companionship track? Is it a phase-specific trend or has it a long-term growth logic? The current AI companion market offers a variety of product forms with varying quality standards. When is it expected that the industry as a whole will enter a mature phase? What are the key indicators of this process? In the user experience of AI companion products, long-term memory and continuous interaction capabilities are considered one of the core competencies. When is the approximate window period for technological breakthroughs in this field within the industry?   Li Qing, Director of Frost & Sullivan China, was interviewed by Time Weekly to discuss the opportunities in the AI companion track. . Time Weekly *Click at the end of the article Read the original text View the full report   Q: How can we gauge the overall popularity of the current AI companion track? Is it a short-term trend or one with long-term growth potential? Li Qing Director, Greater China, Frost & Sullivan   Nowadays, more and more families, young people, and even the elderly are beginning to accept an AI role as a companion in their lives. This is not just hype, but a real social change at work—such as smaller families, fewer children, and more elderly individuals, many of whom are facing the problem of lacking emotional companionship. AI companionship is no longer just a short-term trend, but is becoming a long-term social need and technological trend. It is moving from the technology validation phase to the scenario explosion phase. However, long-term development requires crossing three thresholds: technical capability ceilings, market demand matching, and policy ethics compliance.   Q: The current AI companion market offers a variety of product forms with varying quality standards. When is it expected that the industry as a whole will enter a mature phase? What are the key indicators of this process? Li Qing Director, Greater China, Frost & Sullivan   AI is accompanying the industry into maturity, which is expected to occur around 2028-2030. During this period, there will be several stages: currently, it is a time for technical refinement and market trial and error. Next, it will enter an integration phase, and finally, a stable industry pattern will be formed.   The key indicators of maturity include:   1. Technological standardization: Multimodal interaction has become a standard feature; emotion computing algorithms achieve an accuracy rate of over 90% in cross-age and cross-language sentiment recognition; the deployment and popularization of large-end models on the client side have enabled low-latency, offline intelligent interaction.   2. Clear product segmentation: There are products for different positioning, such as 'Home AI Companion' products with long-term memory, personalized growth, health monitoring, etc.; IP co-branded smart toys that integrate education and companionship; and low-cost voice interaction toys with focused functions.   3. Mature business model: Hardware + subscription services become mainstream: Value-added services such as content updates, personalized training, and mental health counseling generate stable revenue.   4. Regulatory oversight and standard implementation; Establish an ethical framework for AI emotional interaction to prevent risks such as addiction and misinformation; Establish an industry certification system.   Q: In the user experience of AI companion products, long-term memory and continuous interaction capabilities are considered one of the core competencies. When is the window period for technological breakthroughs in this area of the industry approximately? Li Qing Director, Greater China, Frost & Sullivan   The years 2026-2028 are a critical window period for achieving large-scale breakthroughs in long-term memory and continuous interaction capabilities. In the short term, such as next year, optimization based on vector databases will enable AI to remember more details, such as users' birthdays and preferences, significantly improving cross-session memory accuracy. In the longer term, as large models become more lightweight, their capabilities are enhanced, neural-symbol systems are integrated, and edge computing capabilities improve, AI toys can store and learn user data locally, achieving cross-day memory, long-term memory, and even personality evolution. AI may naturally forget unimportant information like humans, while forming associative links with key memories. For example, mentioning rain might remind the user of a past preference for reading on rainy days. It is not just responding to you, but can predict you, care about you, and grow with you. This is the true warm companion. In even longer periods, such as five years from now, brain-computer interfaces may appear as auxiliary functions, influencing mainstream product design and user experience decisions. *This interview has been published in Time Weekly, with the reporter being Zhu Chengcheng. The original title was: The Business That Lei Jun, Musk, and Zhu Xiaohu Are Eyeing May Have a Bubble!

Frost & Sullivan insights Data from the National Post Bureau shows that by the end of 2024, the large-scale application of unmanned delivery logistics vehicles had accumulated over 6,000 units, delivering hundreds of millions of orders to users in over 100 different scenarios. How has the industry ecosystem for unmanned logistics vehicles progressed, and has it achieved a 'technical closed loop + commercial closed loop'? The industry still faces some challenges, such as unstable 'road rights', the inability of technology to meet complex scenarios like night-time, rainy or snowy weather, and mixed traffic between people and vehicles. Additionally, some manufacturers adopt low-price strategies to capture market share, even leading to 'strategic losses'. In light of this, in the next phase, where will the focus of competition in the industry be?   Yang Lei, consulting director for Frost & Sullivan Greater China, was interviewed by Securities Daily to discuss how unmanned logistics vehicles are evolving from 'able to run' to 'scalable and sustainable profitability'.   Q: What is the current progress of the industry ecosystem for driverless logistics vehicles, and has it achieved a 'technology loop + business loop'? Yang Lei Frost & Sullivan Greater China Consulting Director Currently, unmanned logistics vehicles are transitioning from single-point trials to a collaborative phase that emphasizes both 'technology' and 'platform'. The industrial chain has formed a multi-entity pattern consisting of OEMs and chassis platforms, autonomous driving full-stack systems, fleet operations and intelligent scheduling platforms, scenario operators and shippers, as well as urban V2X and energy supply systems. The supporting sensors, computing power, charging and swapping facilities, insurance, and financial solutions are continuously being improved.   Multi-vehicle convoys, remote duty, human-machine collaboration, and vehicle-cloud integration have become basic elements of operational systems. Business models are also shifting from one-time equipment sales to a service-oriented path that charges by mileage, shifts, and service level agreements (SLAs).   In terms of the maturity of 'technology closed-loop + business closed-loop', in enclosed and semi-enclosed scenarios such as ports, mining areas, park main roads, airport aprons, and sanitation operations, the technology closed-loop is available, reusable, and capable of cross-park migration. In business terms, a continuous contract focusing on transportation capacity/service has been formed, with the feasibility of generating positive cash flow; these scenarios share common characteristics such as predictable tasks, simple interaction objects, high mileage density, which make it easier to increase the effective hours per vehicle and fleet utilization rate, while the unit mileage cost curve flattens with scale.   In comparison, the end-to-end delivery of open urban roads and urban arterial roads are still in the stage of large-scale exploration due to road right approval, complex long-tail conditions, mixed human and vehicle traffic, and fluctuations in order density. The commercial closed loop mainly manifests as phased and regional 'local closed loops'.   Overall, the industry has transitioned from 'able to run' to 'able to replicate and run'. The evaluation loop should not only look at demonstration mileage but also observe replicable deployment cycles, remote takeover rates, effective hours per vehicle, the relative discount of comprehensive cost per kilometer compared to labor costs, as well as the health of SLA fulfillment and contract structure. Only when these indicators are repeatedly verified across different cities and customers does it mean that the technical and commercial loops have entered a sustainable scale-out phase.   Q: The industry still faces some challenges, such as unstable 'road rights', technology that cannot meet complex scenarios like nighttime, rainy or snowy weather, and mixed traffic of people and vehicles. In addition, some manufacturers adopt low-price strategies to capture market share, even leading to 'strategic losses'. Given this, where will the focus of competition in the industry shift in the next phase? Yang Lei Frost & Sullivan Greater China Consulting Director Against the backdrop of unstable road rights, challenges in long tail conditions such as at night and in rain or snow, and some companies trading volume for low prices or even 'strategic losses', competition in the industry will shift from 'technological feasibility' to 'scaling up and sustainable profitability'.   Firstly, security and reliability remain fundamental hard constraints. Enterprises need to steadily reduce takeover rates and unsafe event rates in complex scenarios such as at night, during rain or snow, against backlight, and in dense pedestrian and vehicle traffic. They should solidify capabilities into auditable metrics through systematic certifications such as functional safety, expected functional safety, and cybersecurity, trading quantifiable security performance for more stable road rights and customer trust.   Secondly, the cost reduction of the entire vehicle and full-stack operations will determine the economy per unit mileage. By solidifying and integrating sensors, centralizing domain control with vehicle-cloud collaborative computing power, standardizing platform-based chassis and upper installations, BOM can be reduced. At the same time, on the operational side, strengthen management of energy and consumables, predictive maintenance, insurance, and financial leasing optimization, as well as service network layout, to build a predictable and controllable full life cycle TCO.   Secondly, the portability of ODD and 'template-based city opening' will become key to magnifying advantages. Relying on high-fidelity simulation and data flywheel, different cities and parks can be abstracted into reusable scenario packages and policy libraries. This compresses the cycle from signing to stable operation into weeks, forming barriers with replication speed and marginal cost advantages.   Meanwhile, fleet-level operational capability will become the decisive factor. Intelligent scheduling and formation management need to reduce idling and waiting times, deeply integrating with the cargo owner's TMS, WMS, and OMS to achieve end-to-end online order, capacity, and settlement processes. Under a compliant framework, through one-to-many remote monitoring, human input can be precisely directed towards a very small number of long-tail instantaneous tasks.   Governance coordination will also directly affect the scale cap. The path from demonstration zones to gradual gray release requires enterprises to use KPIs such as takeover rate, availability, and mileage density as a basis for policy formulation, enabling the road right-of-way, insurance, and liability determination mechanisms to more smoothly connect with business operations.   In terms of business models, the industry needs to shift from simply offering low prices to value pricing linked to service levels. Contract structures such as cost-saving sharing, minimum guarantees tied to performance, and other improvements can be adopted to enhance cash flow quality and gross profit structure, while avoiding price wars from eroding R&D and safety redundancy investments.   Finally, the assetization of data and models, along with ecological collaboration, will determine long-term compound interest rates and margin widths. Enterprises that can solidify data governance and training/simulation platforms across vehicle models and scenarios into stable engineering capabilities, and build a solid partnership network with OEMs, energy supply, mapping and V2X, insurance finance, and scenario operators, have more opportunities to achieve a positive cycle of 'running safer and cheaper'.   Overall, the leader in the next phase will not necessarily be the one with the lowest hardware prices, but rather a company that can continuously deliver fleet economics under measurable security metrics, possesses the capability for rapid cross-city replication, and has a healthy contract structure of 'technology + platform + operations'. *This interview has been published in Securities Daily Reporter: Wang Jingru, original title: Driverless Cars Reconstructing Express Logistics “Capillaries&rquo;

Frost & Sullivan insights In the face of physical obstacles, the ability to re-establish a bridge between "brainpower" and the torso or facial features, and to achieve the control of expression or mechanical limbs through "thought," is accelerating its integration into reality. Recently, China's first prospective clinical trial of an invasive brain-computer interface was successfully conducted, marking China as the second country in the world after the United States to enter the clinical trial phase in invasive brain-computer interface technology. What is the significance of invasive brain-computer interfaces entering the clinical phase? What were the previous difficulties that hindered their entry into the clinical phase? From the current company layout, it seems that the US market has chosen the invasive route more frequently. What are the reasons? In terms of both the number of brain-computer interface companies and the technology of some companies in the US, what are the relative advantages over Chinese companies? Currently, brain-computer interfaces are divided into three routes: invasive, semi-invasive, and non-invasive. What are the significant differences in the implementation scenarios of these three technical routes? Does this mean that the commercial progress of the three routes will also vary significantly?   Zhou Mingzi, Executive Director of Frost & Sullivan Greater China, was interviewed by the 21st Century Business Herald to discuss the technological leaps behind the clinical breakthroughs of invasive brain-computer interfaces.   21st Century Economic Report   Q: Recently, our country successfully conducted the first prospective clinical trial of an invasive brain-computer interface, becoming the second country in the world to advance to this stage. What is the significance of the entry of invasive brain-computer interfaces into clinical trials? What were the previous difficulties hindering their clinical advancement? Zhou Mingzi Executive Director, Greater China, Frost & Sullivan The entry of invasive brain-computer interface technology into clinical trials in China is of great significance, marking a breakthrough in this field. From three dimensions: scientific research attitude, technical assurance, and future development: Firstly, China's scientific research attitude towards invasive brain-computer interfaces has shifted from cautious to proactive. In the early stages, due to technical risks, research efforts mainly focused on non-invasive technologies. However, in recent years, there has been a significant increase in investment in invasive technologies, with industry and other sectors listing them as a key technical direction since 2023. Secondly, the successful conduct of this clinical trial proves that China has the capability to ensure clinical application of invasive technologies, reaching international leading levels in key indicators such as biocompatibility and signal stability, laying a solid technical foundation for subsequent medical applications. Frost & Sullivan believes that this breakthrough will greatly boost scientific research enthusiasm and promote the formation of a development pattern that equally emphasizes invasive and non-invasive technologies. Invasive technologies will develop deeply in professional fields such as medical rehabilitation, while non-invasive technologies will target broader consumer applications. The two complement each other's advantages to jointly promote the industrialization process of brain-computer interface technology. In the future, China is expected to achieve more original breakthroughs in this frontier field. Historically, brain-computer interface (BCI) technology has encountered numerous challenges in clinical applications: Technically, long-term implantation issues such as biocompatibility (e.g., inflammation caused by electrode materials) and signal stability (signal weakening after implantation) are major obstacles that urgently require the development of softer electrode materials and anti-interference algorithms; ethically, there are disputes involving the protection of thought privacy and the definition of the boundaries of autonomous consciousness; clinically, it is necessary to establish standardized surgical procedures (e.g., precise implant positioning) and establish long-term postoperative monitoring systems; from the patient's perspective, it is essential to weigh the risks and benefits of surgery. Currently, this technology mainly serves specific groups such as those with severe disabilities and faces expensive costs. These factors collectively hinder the progression of BCI technology from laboratory to clinical application.   Q: Judging from the current company's layout, it seems that the US market prefers an invasive approach. What are the reasons for this?   Zhou Mingzi Executive Director, Greater China, Frost & Sullivan American medical innovation companies are advancing invasive brain-computer interface technology, mainly relying on three significant advantages. Firstly, at the technical level, the United States has a profound accumulation and innovation in key core technologies such as microelectrode materials and neural decoding algorithms. For example, the flexible electrode technology developed by Neuralink is a typical representative of this technological advantage. This technology can achieve efficient connection with brain neurons, greatly improving the accuracy and stability of signal transmission. In addition, the US Food and Drug Administration has a relatively open approval process for high-risk medical innovations, which provides convenient conditions for the clinical application of new technologies. The flexibility of the approval process allows medical innovation companies to transform research findings into actual medical solutions more quickly, thereby accelerating the commercialization process of technology. Secondly, in terms of the selection of application scenarios, American medical innovation companies tend to focus on severe medical fields such as Parkinson's disease and spinal cord injury, which require extremely high precision in treatment. Invasive brain-computer interface technology, due to its high-precision characteristics, can better meet these clinical needs and has therefore been widely applied in these fields. For example, through brain-computer interface technology, patients can use their mental activities to control external devices such as wheelchairs or prosthetics, providing them with unprecedented autonomy and improved quality of life. Finally, in terms of patient acceptance, American citizens have a high level of acceptance of innovative medical technologies, and they are more willing to try and adopt new technologies. This open attitude provides a favorable social environment for the promotion and application of new technologies. At the same time, America's comprehensive insurance system can cover to a certain extent the costs of these high-risk, high-reward invasive treatment options, which undoubtedly reduces the economic burden on patients to adopt these new technologies and makes it easier for these options to be promoted and applied. In summary, the technology route chosen by American medical innovation companies not only reflects their technical strength in cutting-edge medical fields but also demonstrates their careful consideration of differentiated competitive strategies. By combining these advantages, America maintains a leading position in the field of invasive brain-computer interfaces and is expected to bring good news to more patients in the future.     Q: In terms of the number of brain-computer interface companies and the technology of some of these companies, what are the relative advantages that the United States currently has over Chinese enterprises? Zhou Mingzi Executive Director, Greater China, Frost & Sullivan Compared to other regions around the world, the United States exhibits a variety of advantages in the field of brain-computer interface (BCI) medical innovation. Firstly, in terms of talent supply, the US has established a comprehensive interdisciplinary talent training system for neuroscience and engineering through top institutions such as Stanford University and MIT, as well as the ecosystem of Silicon Valley, capable of continuously providing talents with composite R&D capabilities. In terms of commercialization, the mature venture capital mechanism and flexible FDA approval process (including the breakthrough device designation program) in the US have promoted rapid technology transformation. Industrially, this is due to the advantages of healthcare industry giants in supply chain support and clinical resource integration. Additionally, American patients have a higher acceptance of innovative therapies, and medical insurance coverage is more extensive. Finally, driven by the demand from government and military agencies represented by NASA, these factors together create a unique advantage in the innovative ecosystem.   Q: Currently, brain-computer interfaces are divided into three routes: invasive, semi-invasive, and non-invasive. What are the significant differences in the implementation scenarios of these three technical routes? Does this mean that there will also be significant differences in the commercial progress of the three routes? Zhou Mingzi Executive Director, Greater China, Frost & Sullivan Currently, invasive brain-computer interface technology has been applied in many clinical fields, especially in the following three main areas: First, the technology is widely used for treating severe motor dysfunction. For example, for amputation patients with limb disabilities, through brain-computer interface technology, they can control external robotic arms with their thoughts alone, performing a series of complex actions such as grasping objects and eating. In addition, for patients with spinal cord injuries, invasive brain-computer interface technology enables them to control exoskeletons, thereby partially restoring their mobility. Second, invasive brain-computer interface technology shows great potential in the treatment of neurological diseases. It is used for deep brain stimulation therapy for Parkinson's disease patients and neuroregulation for patients with refractory epilepsy to alleviate symptoms or control seizures. Finally, for patients with impaired language function, invasive brain-computer interface technology provides the possibility of reconstructing language function, helping them regain their communication ability with the outside world. Semi-invasive neural monitoring techniques, such as ECoG (Electroencephalogram), are widely used in neurosurgical operations that require high signal quality, especially playing a key role in locating epileptic foci. This technique monitors brain electrical activity by placing electrodes on the surface of the brain, providing surgeons with precise guidance to help them more accurately identify and handle abnormal brain tissue, with the aim of controlling or eradicating epileptic seizures. Non-invasive brain-computer interface technology has found applications in multiple clinical fields, mainly focusing on the following three important scenarios: Firstly, it shows great potential in neurorehabilitation therapy. For example, stroke patients can control external robotic hands by wearing electroencephalogram (EEG) caps to perform rehabilitation training actions such as grasping. In addition, non-invasive brain-computer interface technology also demonstrates unique value in the intervention treatment of mental illnesses. By regulating the patient's brain state, non-invasive brain-computer interface technology has been used to treat mental illnesses such as depression and attention deficit hyperactivity disorder (ADHD), providing patients with new treatment options. Due to different clinical application scenarios, the commercial progress of invasive, semi-invasive, and non-invasive brain-computer interfaces will inevitably vary, but there is no superiority or inferiority among them. Although invasive brain-computer interfaces can obtain the most accurate neural signals, providing strong support for the treatment of some severe neurological diseases and in-depth research on neural functions, factors such as high surgical risks and expensive costs limit their large-scale commercialization. Currently, they are mainly concentrated in some high-end scientific research and specific clinical treatment projects. Semi-invasive brain-computer interfaces have achieved a certain balance between signal quality and safety and have a stable market demand in specific fields such as neurosurgery. With continuous technological maturity and gradual cost reduction, their commercial scope is expected to gradually expand. Non-invasive brain-computer interfaces, with their non-invasive and convenient features, have been widely used in multiple clinical fields such as neurorehabilitation and mental illness intervention, and also have great development potential in the consumer market, such as in scenarios like gaming and smart home control, with a very broad commercial prospect. Different types of brain-computer interfaces play unique roles in their respective suitable fields, jointly promoting the development and application of brain-computer interface technology.   Q: One view is that brain-computer interfaces will be the ultimate method of human-computer interaction. What catalysis or assistance will the trend of large AI models bring to the development of the brain-computer interface industry? Zhou Mingzi Executive Director, Greater China, Frost & Sullivan Frost & Sullivan has pointed out that digital innovation technologies such as artificial intelligence will drive the rapid development of brain-computer interfaces (BCI) at three levels: Breakthroughs in clinical treatment: Large models can construct personalized disease prediction models by analyzing large amounts of neural signal data (such as EEGs from epilepsy patients), thereby improving the accuracy of treatments such as deep brain stimulation (DBS). Metaverse technology can provide virtual rehabilitation training environments to accelerate the recovery of neural functions. Leap in Interaction Capabilities: Large models' powerful capabilities in natural language understanding enable them to decode more complex brain signals and intentions, elevating BCI from simple command control to semantic-level interaction (for example, allowing paralyzed patients to generate coherent text directly). In the metaverse, digital twins can provide real-time feedback on BCI operation effects, thereby optimizing the training process. Enhanced innovation in the human body: Combining cognitive enhancement algorithms with large models, BCI may achieve memory reinforcement (such as rapid learning of foreign language vocabulary), while the immersive environment of the metaverse will expand the application scope of BCI in spatial perception and multimodal fusion. Currently, the integration of technologies is beginning to show signs of progress. For example, Neuralink's implantable BCI is exploring voice synthesis solutions that work in conjunction with large models, while a leading international AI company has integrated non-invasive BCI technology into its metaverse innovation research, enabling the control of virtual objects with thoughts. Frost & Sullivan believes that this cross-disciplinary innovation will reshape the new paradigm of human-machine coexistence over the next five to ten years. *This interview has been published in 21st Century Economic Report Reporter: Luo Yiqi, original title: Brain-computer interface implementation race: From technology to clinical trials