The Chinese AI app sending Hollywood into a panic

8 hours agoOsmond Chia,Business reporterandSuranjana Tewari,Asia Business CorrespondentGetty ImagesA new artificial intelligence (AI) model developed by the Chinese company behind TikTok rocked Hollywood this week - not just because of what it can do, but what it could mean for creative industries.Created by tech giant ByteDance, Seedance 2.0 can generate cinema-quality video, complete with sound effects and dialogue, from just a few written prompts.Many of the clips said to have been made using Seedance, and featuring popular characters like Spider-Man and Deadpool, went viral.Major studios like Disney and Paramount quickly accused ByteDance of copyright infringement but concerns about the technology run deeper than legal issues.What is Seedance - and why the stir?Seedance was launched to little fanfare in June 2025 but it is the second version that came eight months later that has caused a major stir."For the first time, I'm not thinking that this looks good for AI. Instead, I'm thinking that this looks straight out of a real production pipeline," says Jan-Willem Blom from creative studio Videostate.Western AI video models have made progress in processing user instructions to make stunning images, he adds, but Seedance seems to have tied everything together. Like other AI tools - Midjourney and OpenAI's Sora - Seedance can create videos from short text prompts. In some cases just one prompt seems to be producing high-quality videos.It is particularly impressive because it combines text, visuals and audio in a single system, AI ethics researcher Margaret Mitchell says.Seedance's impact is being measured by an unlikely benchmark: how well it generates a clip of Will Smith eating spaghetti.Not only can Seedance create a remarkably life-like version of the star tucking into a plate of pasta, it has also spawned viral videos of Smith battling a spaghetti monster - and it looks and feels like a big-budget movie.Many industry experts and filmmakers believe Seedance is a new chapter in the development of video-generating technology.The complex action sequences it is producing look more realistic than its competitors, says David Kwok, who runs a Singapore-based animation studio called Tiny Island Productions. "It almost feels like having a cinematographer or director of photography specialising in action films assisting you."The promise - and the challenge Seedance has run into trouble over copyright issues, a growing challenge in the age of AI. Experts warn that AI companies are prioritising technology over people as they make more powerful tools and use data without paying for it. AlamyDisney owns the rights to multiple franchises, including Marvel's superheroesMajor Hollywood groups have cried foul over Seedance's use of copyrighted characters like Spider Man and Darth Vader. Disney and Paramount issued cease-and-desist letters demanding that Seedance stop using their content. Japan is also investigating ByteDance for alleged copyright violations, after AI videos of popular anime characters went viral.In 2023, the New York Times sued OpenAI and Microsoft, alleging they used its articles without permission to train their AI models. Reddit sued Perplexity last year, claiming the AI firm had illegally scraped user posts. Disney raised similar concerns with Google. Clearly labelling content to prevent deception and building public trust in AI is far more important than "cooler-looking" videos, Mitchell says. And that's why developers must build systems that manage licensing and payments, and provide clear mechanisms for people to contest misuse, she adds.Disney, for instance, signed a $1bn (£730m) deal with OpenAI's Sora so it could use characters from Star Wars, Pixar and Marvel. Seedance's developers were likely to have been aware of potential copyright issues around the use of Western IP and took a risk anyway, says Shaanan Cohney, a computing researcher at the University of Melbourne."There's plenty of leeway to bend the rules strategically, to flout the rules for a while and get marketing clout," he adds.Meanwhile, for small firms, Seedance is too useful to ignore. Kwok, from Singapore's Tiny Island Productions, says AI of this quality will allow companies like his to create films that would cost far more than they can otherwise afford.He gave the example of Asia's booming short‑form videos and micro‑dramas that typically run on small budgets - roughly $140,000 for as many as 80 episodes under two minutes each.These productions have been sticking to romance or family drama to keep costs down as they need fewer visual effects. But now AI can "elevate low-budget productions into more ambitious genres such as sci-fi, period drama and, now, action", Kwok says.Getty ImagesHumanoid robots at a factory in ShanghaiIs China racing ahead? Seedance once again puts Chinese tech in the spotlight. "It signals that Chinese models are at the very least matching at the frontier of what is available," Cohney says. "If ByteDance can produce this seemingly out of nowhere, what other kinds of models do Chinese companies have in store?"Last year DeepSeek, another Chinese AI model, sent shockwaves around the world with its low-cost large language model. It quickly overtook ChatGPT as the most-downloaded free app on Apple's US store.In the year since Beijing has put AI and robotics at the core of its economic strategy, investing heavily in advanced computer chip production, automation and generative AI as it bids for a technological edge over the US. While Seedance 2.0 was making headlines, other big Chinese firms had lower-profile rollouts of their new generative AI tools ahead of the Lunar New Year holiday.The Spring Festival is increasingly becoming an "AI holiday," with firms timing launches for a period when millions of people are at home and experimenting with new apps, China analyst Bill Bishop wrote in his newsletter. He predicts 2026 could mark a turning point for mass AI adoption in China - not just chatbots, but also AI agents handling transactions, coding tools incorporated in everyday work, and video creators routinely using AI.