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The next frontier of AI: how ‘world models’ are simulating reality and virtual spaces

Increasingly, AI systems are expected to predict how environments will respond to actions before they are taken

3-MIN READ3-MINMinxiao Changin ShenzhenPublished: 8:30pm, 10 Jul 2026Artificial intelligence has spent years learning to generate words, images and videos. Now, the industry’s attention is shifting towards “world models” – AI systems designed to simulate how the physical or digital world changes over time.

While the term was originally associated with physics simulations and robotics, a growing number of Chinese companies are applying the concept more broadly. The technology remains in its infancy, with little consensus on what a world model should ultimately look like.

Here’s what you need to know about the next frontier of AI.

World models have quickly become one of AI’s hottest buzzwords, with big tech names jumping into the fray.

Read original at South China Morning Post

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