Introduction to Content Industrialization and miHoYo’s Strategic Positioning

On March 2020, a small Shanghai-based studio released a game that would redefine global entertainment: *Genshin Impact*. Within its first month, the open-world action RPG generated $250 million in revenue across 40+ countries, supported 13 languages, and delivered a steady stream of high-quality content updates every 42 days— a cadence that was virtually unheard of in the global AAA game industry at the time. For players, this consistency felt like magic: new regions, characters, storylines, and events arrived like clockwork, with no major quality dips or prolonged delays. For industry observers, however, this was not magic. It was the tangible output of a rigorously built content industrialization system, one that the studio—now known globally as HoYoverse, with miHoYo as its core operating entity—had spent nearly a decade constructing, iterating on, and scaling. This chapter unpacks the core concept of content industrialization, traces miHoYo’s evolution from a tiny ACG (Animation, Comic, and Game)-focused startup to a global entertainment powerhouse, and maps how its strategic investments in standardized, modular, scalable production solved the fundamental pain points that have long plagued creative industries.

To understand miHoYo’s success, we first need to define what content industrialization actually means, and why it is distinct from the ad-hoc, craft-driven creative production that has long dominated the entertainment industry. At its core, content industrialization is the process of breaking down creative output into discrete, reusable, standardized modules, then building repeatable, scalable production pipelines to assemble, test, and refine those modules into finished products. This is not a new concept: it is the same logic that drove the Industrial Revolution in manufacturing, where handcrafted goods produced by individual artisans were replaced by standardized, assembly-line-produced items that could be manufactured at scale with consistent quality. For creative industries, this shift has been far slower to adopt, because creativity has long been framed as a purely intuitive, individual act, incompatible with the rigid structures of industrial production. But as entertainment products have grown in complexity—from 2D mobile games to open-world cross-platform experiences, from single films to multi-decade interconnected IP universes—the limits of craft-driven production have become impossible to ignore.

Consider the traditional model of game development, which still dominates many mid-sized and small studios: a small core team of senior creators (lead designers, art directors, technical leads) works in a relatively ad-hoc manner, with decisions made through informal consensus, assets produced by individual contributors with minimal standardized guidelines, and cross-team coordination handled through endless meetings and Slack threads. This model works for small, simple projects: a 2D puzzle game with 10 levels, for example, can be built by a team of 5 people in 6 months with no formalized processes. But as projects scale in scope and team size, this model breaks down rapidly. The communication complexity of a team grows quadratically with its size: for a team of $n$ people, the number of unique communication paths is given by the formula $C = \frac{n(n-1)}{2}$. For a team of 10, this is 45 paths; for a team of 100, it is 4,950; for a team of 1,000—the size of miHoYo’s *Genshin Impact* development team at its peak—it is 499,500. Without standardized processes and modular workflows, these communication paths become tangled, leading to duplicated work, conflicting asset versions, missed deadlines, and inconsistent quality. This is the fundamental scalability problem of craft-driven creative production: it works for small teams, but collapses under the weight of large, complex projects.

This is not a problem unique to the game industry. Hollywood has grappled with this for over a century, and its solution was the studio system of the early 20th century, an early form of content industrialization. Under this system, major studios like MGM and Warner Bros. standardized every part of the film production process: from contract templates for actors and crew, to standardized set designs and costume patterns, to assembly-line-style production schedules that allowed studios to release dozens of films per year. Later, the rise of the blockbuster franchise model in the 1970s and 2000s—led by studios like Pixar and Marvel—built on this foundation, adding standardized IP management, cross-media content pipelines, and global distribution systems. Pixar, for example, has a fully standardized animation production pipeline: every film goes through the same set of stages, from storyboarding to character rigging to rendering, with standardized asset formats and quality checkpoints at every stage. This allows Pixar to release a new film every 1-2 years with consistent quality, even as its team has grown from 100 people for *Toy Story* (1995) to over 1,000 for *Inside Out 2* (2024). The Marvel Cinematic Universe (MCU) is another example: every MCU film follows standardized production, post-production, and marketing timelines, with standardized cross-film continuity guidelines that allow 3-4 MCU films to be released per year without narrative or quality inconsistencies. These examples prove that industrialization does not eliminate creativity—it liberates it, by removing the repetitive, administrative work that consumes most of a creative team’s time, and allowing creators to focus on the parts of the process that require original thought and artistic judgment.

miHoYo’s journey toward content industrialization began not with a grand strategic plan, but with the practical pain points of a growing startup. Founded in 2012 by three Shanghai Jiao Tong University students—Cai Haoyu, Liu Wei, and Luo Yuhao—miHoYo started as a tiny ACG studio focused on creating 2D mobile games for the niche Chinese ACG market. Its first release, the puzzle game *FlyMe2theMoon* (2012), was built by a team of just three people, with no formalized production processes: the three founders handled design, art, and programming themselves, with assets created on an ad-hoc basis and updates released whenever the team had time. The game was a modest success, earning enough revenue to fund a small expansion of the team to 10 people for its second release, *Honkai Gakuen 2* (2014), a 2D side-scrolling shooter.

It was with *Honkai Gakuen 2* that miHoYo first encountered the limits of craft-driven production. As the game’s player base grew, the team faced constant pressure to release new content: new characters, new story chapters, new gameplay modes. But with no standardized production processes, each new piece of content took far longer to produce than expected. A single new character, for example, required 2-3 weeks of work: the art team would create concept art, which would be revised 5-7 times to align with the team’s informal style guidelines; the 3D modeling team would then build the character model, which would require multiple rounds of revisions to match the final concept art; the animation and programming teams would then integrate the character into the game, a process that often revealed compatibility issues requiring further rework. The result was an update cycle of 2-3 months per version, far slower than competing ACG games, and a growing backlog of player requests that the team could not keep up with. It was at this point that the founding team realized that if miHoYo wanted to scale beyond a small niche studio, it needed to build a formalized production system.

The first major test of this new system came with *Honkai Impact 3rd*, released in 2016. A 3D action RPG with fully rendered 3D characters, complex combat mechanics, and regular live-service updates, *Honkai Impact 3rd* was a massive leap in scope from miHoYo’s previous releases. The development team had grown