Giving hardware a second chance.
As mature products like PCs and smartphones enter a phase where there is little room for further competition, the industry has begun to think more deeply and experiment commercially with the “next generation of hardware devices”.
Whether it is tech giants or small and medium-sized hardware manufacturers, they are starting to lay the groundwork for the next big thing. From AI glasses, robots, and drones to other wearable devices, the market is attempting to create new interaction methods, using technological innovation to accurately target high-value scenarios.
The industrial value of this technological revolution has been precisely captured by leading platforms. This year at the Yunqi Conference in Hangzhou, Alibaba Cloud and Tmall jointly announced the launch of the “AI New Category Joint Plan” to jointly promote the accelerated development of the smart hardware industry driven by AI. During the recent Double Eleven shopping festival, AI hardware also emerged as a hot category across major platforms, with consumers quietly accepting AI into their daily lives.
Bringing smart hardware to consumers
The arena of smart hardware is not exclusive to major players, but small and medium-sized enterprises face dual challenges of technology and market in their quest to break through.
Starting from the origin of hardware manufacturing, the challenge is not only competition in hardware manufacturing but also the deep integration of connectivity, data, and intelligence. For hardware manufacturers, simply producing products is not enough; differentiation capability is becoming the key to future competition. This means that a significant amount of resources must be directed towards technological research and development, with AI large models becoming a way to alleviate technological pressure.
However, the reality is not so easy. Currently, many AI large models have emerged in the market, but most remain at the stage of general model output and cannot specifically solve the problems of individual enterprises. The high costs of secondary development and traffic have left many small and medium-sized enterprises in a wait-and-see phase.
For some technology-driven enterprises, product research and development may not yet pose a real obstacle, but entering the market conversion phase is a state of being completely in the dark: How to reach target customers? How to expand sales channels? How to effectively market products?
The high threshold of technological research and development and the high difficulty of market conversion represent the survival battle faced by smart hardware manufacturers.
In light of these industry insights, Alibaba Cloud and Tmall decided to collaborate deeply across multiple dimensions such as organization, policy, traffic, channels, and market, achieving complementary support between technology and market, and bringing opportunities to redefine products in the hardware field.
At this year’s Yunqi Conference, Zhang Liang, Vice President of Alibaba Cloud Intelligent Group and President of the SME Division, Gong Cheng, General Manager of Tmall 3C Digital & Carrier Industry, along with co-founders of Lingyu Universe and sales leaders from XREAL, and marketing director of Yuanluobo, Cui Xiaolong, jointly attended the launch ceremony of the “AI New Category Joint Plan”, marking the beginning of the “Cloud + Tmall” collaboration to empower the smart hardware industry.
On the technology side, Alibaba Cloud will maximize the advantages of AI large models, cloud computing, and edge-cloud collaboration technologies. Its latest generation of the Tongyi Qianwen model Qwen3 ranks first among global open-source models in the authoritative open-source model evaluation list Live Bench, surpassing top closed-source models like o3High and Gemini 2.5pro in instruction-following capabilities. Currently, Alibaba Cloud has formed a full-stack layout from AI computing infrastructure, cloud platform services, large model research and development to open-source ecology and large-scale applications.
On the market side, to support the development of AI hardware, the Tmall platform has completed four optimizations, including eSIM integration, in-site AI category search recommendations, trade-in policies, and multi-channel construction.
Alibaba Cloud and Tmall have more in store. It is not just a simple integration of platform resources; in fact, this joint support plan covers key areas such as XR devices, smart robots, and drones, providing substantial sincerity from four major directions.
In terms of independent organizational support, both parties have established a joint project team and held the first smart product recruitment meeting in Shenzhen; in terms of independent policy customization, customized rebates, traffic, and operational support will be provided for smart products based on Alibaba Cloud’s AI capabilities; in terms of independent resource allocation, all AI new products will enjoy exclusive growth incentives, marketing IP (such as Double Eleven, Red Cat Plan), and market exposure; and there will also be independent technical support, with Alibaba Cloud providing exclusive one-on-one technical support and model-specific discounts.
Currently, consumer acceptance and demand for AI hardware have undergone a leap forward. Tmall data shows that the transaction volume of smart glasses is expected to grow 13 times year-on-year by 2025, the search volume for “robot dogs” has surged 14 times, and AI 3D printers sold out immediately upon launch. The implementation of the joint plan aims to allow more small and medium-sized enterprises to share in this market dividend.
Validation of Pioneer Value
Who will be the first to validate the value of the joint plan? At least on-site, we can clearly see various paths of empowerment from Lingyu Universe and Yuanluobo.
The first product from Lingyu Universe, the portable AI hardware “Lingyu Universe Small Square Machine”, is a smart companion product. This is a rapidly growing track; according to Beizhesi Consulting, the global market size for companion robots reached 75 billion yuan in 2023 and is expected to exceed 300 billion yuan by 2029. This is not just a visible but intangible number.
Relying on Alibaba’s Qianwen large model’s multimodal interaction capabilities, the Lingyu Universe Small Square Machine has achieved an “AI Native, Voice First” form definition. Through Face Time interaction, the AI can “see” the real world; when a child points to a tree by the roadside, the device can instantly analyze the type of plant and its growth characteristics; using Alibaba Cloud’s situational awareness algorithms, the product can actively generate exploratory interactive rooms based on the child’s interests and memories, truly realizing that “the world is a classroom”.
In terms of market implementation, Tmall can help Lingyu Universe’s innovative scenarios accurately reach target users. For example, leveraging the Xiaohongshu “Red Cat Plan” to help Lingyu Universe create a content matrix for “Outdoor Exploration Diary”.
This year’s Double Eleven, the Lingyu Universe Small Square Machine performed outstandingly in the market, achieving a month-on-month growth of over 231% in total sales across all channels, and also topped the total list of toys for infants and toddlers and the AI toy list on JD during the Double Eleven.
Focusing on family scenarios, Yuanluobo has launched chess robots, Go robots, international chess robots, and multi-functional robots, successfully creating the “home chess robot” category.
For example, the recently released four-in-one AI chess robot has officially integrated with Alibaba Cloud’s Tongyi Qianwen Qwen3, leveraging Qwen3’s powerful language understanding, logical reasoning, and generation capabilities, allowing Yuanluobo to evolve from merely “teaching chess” to becoming a multi-dimensional “super coach + growth partner”.
In the future, with the help of the joint plan, Yuanluobo can quickly penetrate the sinking market and mid-to-high-end families through Tmall’s trade-in policy and reach the 88VIP customer group.
The Eve of Industry Explosion
The AI smart hardware industry is on the brink of explosion.
Currently, the technological foundation has entered a stage of full maturity. Alibaba Cloud’s AI large models have lowered the R&D threshold, and technologies like Tongyi Qianwen Qwen3 enable small and medium-sized manufacturers to create “soulful” products, making technology no longer a “moat” for a few enterprises.
Thanks to the technological explosion, market demand has been thoroughly activated. Consumer acceptance of AI hardware has shifted from “trying it out” to “a necessity”. The scale of smart hardware in Chinese households is rapidly climbing, and companies like Lingyu Universe and Yuanluobo are facing a billion-level incremental market; Tmall’s platform and trade-in policies further lower the consumption threshold, turning “want to buy” into “can buy”.
Alibaba Cloud’s technological foundation and Tmall’s market expansion allow “good technology” to quickly become “good business”, providing more small and medium-sized enterprises with opportunities to gain market dividends.
When the technological foundation is solid enough, market demand is strong enough, and ecological collaboration is efficient enough, the explosion of the AI smart hardware industry is no longer a “future possibility” but is “happening now”, and it will surely bloom more AI sparks in the market.