The Asian microdrama war: China’s AI power play is coming for your screen

MANILA — The next big fight in streaming may not be over the next blockbuster series. It could be over the next 90 seconds on your phone.

China’s microdrama industry is expanding rapidly, with technology companies and streaming platforms pushing bite-sized, cliffhanger-driven stories to audiences around the world. Now, artificial intelligence is giving producers another weapon: the ability to make some dramas faster and at a fraction of traditional production costs.

The numbers point to a business that is getting harder for the entertainment industry to ignore.

Global short-drama apps recorded more than 850 million downloads in the first quarter of 2026, up 140 percent from a year earlier, according to Sensor Tower. In-app purchase revenue reached approximately US$750 million, up 20 percent year on year.

Southeast Asia was the biggest source of downloads, accounting for 32 percent of the global total. Latin America followed with 23 percent, and India with 22 percent.

But downloads do not automatically translate into paying customers. Sensor Tower’s figures show the scale of the audience, while industry analysis points to a tougher challenge: turning those viewers into subscribers and paying users.

The global market is also growing quickly. Omdia estimates microdrama revenue reached $11 billion in 2025 and could hit $14 billion by the end of 2026. The research firm says the United States is now the largest international market outside China.

And the competition is intensifying. Media Partners Asia estimates that microdrama revenue outside China will rise from $2.7 billion in 2025 to $3.6 billion in 2026, potentially reaching $9.5 billion by 2031.

Its estimates put ReelShort in the lead with 29 percent of the overseas market, followed by DramaBox at 21 percent, DramaWave at 13 percent, NetShort at 10 percent and GoodShort at 6 percent.

These figures come from different research firms and use different market definitions. They should not be added together. But they point to the same trend: short, mobile-first drama is becoming a serious global entertainment business.

For producers, the biggest disruption may be happening behind the camera.

In China, AI is already changing the economics of microdrama production. A producer interviewed by CNA said an AI-generated microdrama series cost around $14,900 to produce and could be completed in less than a month.

A traditional live-action costume microdrama, by comparison, could cost at least $44,700 to $74,500 and take two to three months.

That is a substantial reduction in the reported production budget and turnaround time. But these are industry estimates for microdrama series, not a controlled comparison of productions with identical scripts, quality standards or resources. They are also not the cost of making a full-length feature film.

Reuters has separately reported that the cost of producing AI short dramas in China fell from around $745 per minute to around a fifth of that per minute in early 2026. 

The savings come with a warning. Lower production costs can make it easier to flood platforms with content, but they do not guarantee a hit. Reuters reported that of 221,900 AI shows launched on Douyin in the first half of this year, only 1,055 attracted more than 100 million views.

For companies entering the business, the challenge is no longer just producing more episodes. It is making stories people actually want to watch.

For Sharon Tse, CEO of Loomi Entertainment Group, AI is becoming part of the production process, but the creative work still matters.

Tse said Loomi has developed its own AI-generated content platform, called Imaginary, and works with directors and scriptwriters to produce original AI microdramas.

The barely two-year old company has also built a virtual studio that allows creators to plan camera movements and actor movements before generating scenes. That gives the production team more control over how a story unfolds, rather than relying on prompts alone.

Tse told ANC’s Startup that the technology can help address some of the budget and production limitations that have traditionally prevented creators from delivering the visuals they want.

But Loomi is not positioning AI as a substitute for every part of filmmaking. Its approach still involves professional creative talent, with AI used to help develop and produce the content.

The company is also looking beyond short-form vertical dramas. Tse said Loomi is exploring longer-form projects, including film and drama content, while developing titles for different Asian markets.

The Philippines is already part of the audience story.

Tse said Filipino viewers are among Loomi’s biggest audience groups, but the company has yet to produce Filipino-language originals. She said it is interested in working with local writers and creators, while the company continues to develop content in markets such as Thailand and Korea.

That leaves a major question for the local entertainment industry: can Filipino stories find the same audience in a vertical, mobile-first format?

The opportunity is there. Filipino viewers are familiar with serialized drama, emotional cliffhangers, romance, family conflict and stories built around strong characters. Those elements can translate to short episodes designed for mobile screens.

But success will depend on more than making content shorter or cheaper. Local stories will need strong writing, memorable characters, good production choices and a business model that can turn views into revenue.

There is also a difference between having a large audience and having an audience willing to pay. Southeast Asia’s strong share of global downloads makes the region attractive to platforms, but converting that reach into subscriptions and sustainable revenue remains a challenge.

For Loomi, the Philippines could be more than a market for imported microdramas. It could also become a source of original stories.

The Asian microdrama race is no longer just about who can produce the most episodes or attract the most downloads. It is about who can combine technology, compelling storytelling and a business model that works.

AI may lower the cost of getting a story onto the screen. But the real competition will still be for the audience’s attention.