iQIYI’s Tech-Driven Theme Park Expansion: A New Playbook for China’s Entertainment Landscape

iQIYI, China’s leading streaming platform, is rewriting the rules of the offline entertainment industry with its second theme park, iQIYI LAND, set to open in Kaifeng, Henan Province. This expansion marks a bold step into a sector projected to grow from RMB 60 billion to over RMB 110 billion by 2028. By blending proprietary intellectual property (IP), cutting-edge technology, and cultural heritage, iqiyi aims to create a scalable, agile model that could redefine how audiences engage with entertainment.

The Kaifeng Play: Where Tech Meets Tradition

The new park, part of the 960 Cultural and Creative Park, leverages Kaifeng’s historical significance and strategic location. . With high-speed rail links to Zhengzhou (population 13 million) and Luoyang (7 million), the park taps into a catchment area of over 20 million potential visitors. Its design integrates seven core attractions from the Yangzhou park—such as immersive theater and holographic light spaces—plus new IP-themed exhibitions. Crucially, the park uses AI-driven NPCs, VR film sets, and MR experiences to enable frequent content updates, reducing reliance on costly live performers and mitigating IP depreciation risks.

A Tech-Powered Competitive Edge

Traditional theme parks face challenges like high capital costs, long payback periods, and static attractions. iQIYI’s model sidesteps these by prioritizing digital interactivity. For instance, its proprietary game engines allow real-time adjustments to attractions, while AI personalizes guest experiences. This agility is critical in a market where 70% of Chinese theme park revenue comes from repeat visitors, according to China Insights Consultancy.

iQIYI’s 20+ city pilot programs—featuring immersive storytelling experiences—have already validated demand. These experiments now form the backbone of its theme parks, ensuring a tested revenue stream. As CEO Yu Gong noted, the goal is to turn audiences into “co-creators,” deepening emotional ties to iQIYI’s IPs like The Legend of Qin and Love Apartment.

Market Potential and Risks

The theme park sector’s projected growth to RMB 110 billion by 2028 offers a vast addressable market. However, iQIYI faces competition from established players like Walt Disney (DIS) and Merlin Entertainments, as well as regional rivals. . While iQIYI’s stock has fluctuated with streaming market dynamics, its offline pivot could stabilize revenue streams.

Risks remain. Capital-intensive projects require significant upfront investment, and execution is key—especially in integrating technology seamlessly. Yet iQIYI’s early moves, such as its partnership with the 960 Cultural Park to share infrastructure costs, suggest a cost-efficient strategy.

Conclusion: A Strategic Bet on the Future of Entertainment

iQIYI’s Kaifeng park represents a calculated gamble with high upside. By merging its vast IP library with AI/VR, it’s creating a replicable model that could dominate China’s offline experience market. With a tested pilot network, a prime location, and a sector growing at 12% annually, the park’s success could drive revenue diversification beyond its core streaming business.

Investors should note that iQIYI’s (IQ) current valuation of ~RMB 35 billion (as of 2023) lags its market potential. If the Kaifeng park achieves its 20 million visitor target, it could add ~RMB 1.5-2 billion annually in ticket sales alone—assuming average spending of RMB 80 per visit. Combined with merchandise and subscription upsells, this could significantly boost margins.

While risks persist, iQIYI’s tech-driven approach addresses key industry pain points, positioning it as a pioneer in the “metaverse-ready” theme park era. For investors, this isn’t just about a new revenue stream—it’s about owning a stake in the future of entertainment.