Amid the Boom, Dracin Faces Many New "Enemies" in China

Jakarta, CNBC Indonesia - China’s entertainment industry is undergoing massive disruption from the emergence of AI-based micro-dramas.

Micro-dramas or short Chinese dramas (dracin) are a super-short viewing format that combines TV series style with social media scrolling experiences.

Micro-dramas are extremely short, usually 1-5 minutes per episode, with many episodes (often 30 to 100). The stories are created quickly, full of conflict, cliffhangers, and twists to keep viewers watching the next episode.

One example is the animated series “Orange Cat Taoist Priest: Fighting the Zombie King”, featuring a tabby cat in a robe battling zombies in two-minute episodes.

Although it sounds niche, this format has gone viral and attracted hundreds of thousands of viewers. However, behind its popularity, signs are emerging that this trend is facing serious challenges, both from a regulatory perspective and business sustainability.

AI Micro-Dramas Shake Up the Entertainment Industry

The micro-drama phenomenon has changed the way Chinese society consumes entertainment. In January, time spent watching long dramas fell by up to 15% year-on-year.

Conversely, micro-drama platforms like Red Fruit (owned by ByteDance) recorded a surge in viewing time of more than double.

The key to this explosion lies in cost efficiency. With AI technology assistance, production costs can be reduced by up to 90%. Even live-action productions, which were already cost-saving, are now losing competitiveness.

In some regions, live-action micro-drama production has reportedly plummeted by up to 80%, while actors’ fees have been cut in half. Yet, these actors’ fees were already low to begin with.

This situation shows that AI has become a structural changer in the industry. Content production no longer relies on big studios or professional actors, but can be done with much cheaper and faster technology.

This short dracin phenomenon is also popular in Southeast Asia as digital content consumption patterns shift. These short dramas are often termed ‘dracin’ (Chinese drama), as most originate from the Land of the Bamboo Curtain.

The e-Conomy SEA 2025 report released by Google, Temasek, and Bain & Company shows a significant surge in short drama app downloads throughout the first half of 2025.

According to the report, the contribution of short drama apps to total video-on-demand (VOD) platform downloads rose sharply by 56% in 2025, from 31% in the first half of 2024. Short drama app download figures grew 120% year-on-year (YoY).

From the active user side, short drama apps also showed rapid growth. The share of active users for these apps rose from 5% to 17%, or a 200% YoY surge.

Regulations and Competition Become New Challenges

Although growing rapidly, AI micro-dramas are starting to face various obstacles. Since 1 April, regulators in China have required all animated series without permits to be removed from digital platforms.

New content must also go through an approval process before release. This is a signal that the government is beginning to closely monitor the growth of AI-based content.

On the other hand, an overly crowded market is also a problem. The massive production of AI micro-dramas has made competition increasingly fierce, so many contents fail to attract enough viewers to generate profits.

Additionally, the extremely short format makes it difficult for viewers to build emotional attachment to characters. Thus, audience loyalty does not form.

In response to this situation, Chinese tech giants are seeking balance.

Alibaba, for example, released a new season of the long animated series “The Demon Hunter”, which already has more than 10 million followers.

This shows that amid the dominance of short content, long-duration dramas still have a chance to survive in the battle for viewer attention.

Sought After But Feared

Revenue from China’s micro-drama industry is projected to nearly double in 2025 to 90 billion yuan (US$12.7 billion)—surpassing cinema ticket sales. Studios in China produced 40,000 micro-drama titles in the first eight months of 2025 (one series typically has 90 episodes).

The micro-drama fever is just one example of the ongoing explosion of creativity in China. In early 2025, “Ne Zha 2”, a production from a Chinese studio, became the highest-grossing animated film globally of all time. Meanwhile, “Black Myth: Wukong”, a Chinese-made video game, also captivated players when released a year ago.

This phenomenon presents a dilemma for the Communist Party of China, which is beginning to recognise the value of exporting Chinese culture abroad, yet remains wary of giving too much freedom to creatives amid the government’s strict censorship.

The Chinese government has historically tended to prioritise science and technology over entertainment, so investments in sectors like gaming and short videos were once less encouraged. Tight control over content not only makes investors hesitant but also diverts creative talent to other industries.

Nevertheless, Chinese tech giants continue to pour funds into the entertainment industry. For example, with Black Myth: Wukong, Tencent helped fund the game-making studio founded by its former executive, Feng Ji.

That funding support gave Feng more time to develop the game while launching a four-year marketing campaign before release. The studio behind Ne Zha 2 was also backed by the boss of Meituan, another major tech company.

Such support is crucial for China’s new generation of creative talent. Many of them, including Feng Ji and Yang Yu (director of Ne Zha 2), were born in the 1980s when China began opening up to the world. They grew up in the early 2000s, when internet censorship was minimal and access to foreign sites and cultures was far freer.