00:00Lianjie Su is Chief Analyst at Technology Research Group Omdia.
00:05So there's a couple of things that helps with the success of Enflame. Enflame, first of all,
00:11is a company that's backed by a much larger hyperscaler in China, which is Tencent Cloud.
00:17And Tencent Cloud has obviously been one of the leading, not just hyperscalers, but also frontier
00:22AI model vendors in China. The other part to the success of Enflame is that Enflame is a
00:28GPU-like vendor. So basically they are producing chipsets that are similar to that of NVIDIA.
00:35And because of the obviously lack of NVIDIA's present in China nowadays, any companies that
00:41are offering so similar solution to NVIDIA is deemed as sort of a worthy replacement of that
00:50to capture those markets that is currently available or out for grab in China.
00:57And Enflame being one of the key players in the market are well positioned to benefit from
01:02the opportunity.
01:04Enflame is the last of these so-called four little dragons to go to the market. The other
01:10three also had strong starts, but then it's been a little bit more volatile for them. More
01:16threads is a good example. What's going on there, do you think?
01:21Obviously, as you mentioned, there are four of them. In fact, there are multiple, more than four
01:26basically in China, eyeing for this gap that's left behind by NVIDIA. There is obviously a lot of
01:35concern within China in the sense that do you really need that many similar companies offering
01:41similar solutions to the market. I think other than that, there is a smaller pool of AI vendors
01:48if you compare what's going on in China versus the rest of the world. So naturally, investors are,
01:55let's say, less confident that all four or maybe all of the GPU-like vendors will be extremely
02:03successful or will be financially sustainable in the near future. I think there is probably some
02:10consensus in the market that there is going to be fierce competition and perhaps then there will
02:14be some sort of, I guess, rearrangement, perhaps acquisitions or merger going on in the industry
02:23in the near future. So if, let's say, Enflame is successful in somewhat replicating NVIDIA's
02:30playbook, but also maybe push the boundary a little bit further, have just sort of embed themselves
02:37much deeper into the Tencent ecosystem. There is real benefit in terms of synergy and in terms of
02:44sort of that mutual relationship that Tencent can bring to Enflame in terms of the long-term
02:51success of the company.
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