iQIYI’s AI Drama Faces Backlash Over Industry Dynamics

iQIYI’s newly announced AI drama initiative quickly encountered resistance, sparking heated criticism online and causing its stock to drop more than 5%. The controversy did not stem from AI’s technical capabilities but from entrenched industry relationships, as the company prematurely claimed 117 artists had joined its AI actor library despite some only expressing initial interest, prompting public denials and fueling a wave of negative sentiment. At the iQIYI World Conference on April 20, CEO Gong Yu promoted a “decentralized platform transformation,” envisioning iQIYI as a community‑driven UGC platform rather than a traditional content producer, an “all in AI” strategy aimed at reducing production costs and reshaping bargaining power with talent.

The backlash revealed deeper challenges: AI dramas still rely on recognizable stars to attract audiences and have yet to disrupt traditional profit‑sharing structures. Without resolving these issues, platforms risk alienating both artists and their fan bases, with users quick to migrate to competitors. The stock decline on April 21 underscored investor concern that reputational damage could translate into real losses. Analysts note that even in an AI drama era, long‑form video platforms may still need to compete for star talent and IP rights, as bargaining power remains central to profitability.

Balancing AI dramas with traditional productions adds further complexity. While AI dramas promise lower costs and new formats, their audience acceptance remains uncertain, whereas live‑action dramas continue to generate reliable revenue for platforms such as Tencent Video, Youku, Netflix, Amazon, and Apple. Tencent Video has taken a more cautious approach, announcing AI‑produced series and films expected in late 2026, while Youku has positioned AI as a productivity system to enhance rather than replace human creators. Unlike its rivals, iQIYI’s aggressive stance has triggered widespread controversy at a time when its revenues have declined for two consecutive years and its monthly active users have been surpassed by Tencent Video. For iQIYI, AI dramas may appear to be a solution to mounting challenges, but the company remains entangled in the realities of human relationships, profit distribution, and public opinion—issues that technology alone cannot resolve.