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

Artificial intelligence has spent years learning to generate words, images and videos. Now, the industry’s attention is shifting towards “world models” – AI systems designed…

By Samantha Johnson / July 10, 2026

Artificial 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.

What is a world model – and why the sudden buzz?

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

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