They introduce a recurrent state-space model (RSSM) that predicts forward in pure latent space.

Citation

(Hafner et al., 2018)

Hafner, D., Lillicrap, T., Fischer, I., Villegas, R., Ha, D., Lee, H., & Davidson, J. (2018). Learning Latent Dynamics for Planning from Pixels. https://arxiv.org/pdf/1811.04551