Following the shockwave to US AI that was DeepSeek, whereby a cheaper overseas competitor to US AI giants sent ripples across the region’s emerging technology space, such as NVIDIA stock prices plummeting at rates then unseen and unforeseen, a similar trend may be arising in the XR/RT3D market.
With recent developments, it appears this same shockwave could hit the XR space, or in other words, the RT3D solutions marketplace. RT3D engines such as Unreal and Unity greatly support the XR space from consumer to enterprise, providing a framework for developing and distributing immersive experiences regardless of the end use case.
Of course, other RT3D content creation engines, such as Virtualware and Synergyxr, are closely aligned to the needs of specific business use cases. However, the powerhouses of Unreal and Unity have an undeniable presence and influence.
With that knowledge in hand, it appears that a DeepSeek-style shockwave may hit the space. According to the XR grapevine, a Chinese-produced Unity clone is emerging, splitting the developmental efforts of those creating RT3D solutions for international clients.
The Tuanjie Engine, localised for the Chinese market, fully complies with local platforms and regulations. Additionally, some of its features are already more advanced than some features of the international version of Unity. Unity China developed the application with support from regional giants such as miHoYo, Alibaba, and China Mobile. The effects will soon become apparent.
The Ongoing Effect on XR
This sentiment stems from Deepseek’s disruptive marketplace debut in January, which introduced competitive AI services at a fraction of the cost of established providers. As a result, NVIDIA’s stock experienced a significant drop at that time. While the situation recovered, the emergence of an affordable AI alternative outside the US highlights the importance of international AI distribution.
The downturn for Deepseek coincided with global leaders strengthening investments in and relaxing restrictions on AI development to gain a foothold in this emerging landscape. Deepseek’s disruptive and low-cost approach has led to speculation about whether a similar shift could occur following discussions regarding the high costs associated with OpenAI’s agents.
This potential future remains uncertain but presents opportunities for many firms, not just Deepseek. However, Deepseek offers an entirely different value proposition to Tuanjie Engine, and the effects will most likely not be as significant as those of the Deepseek debut.
But, with mounting international tariff tensions between the US and China, the reactions from internationally present software and hardware solution providers will likely take effect soon.
For many reasons, the XR and RT3D industry may see more leading solutions providers create alternative services for different markets, due to international regulations. If the effect reaches the heights of Deepseek, it will be seen shortly.
