The Chinese company uses AI to create nearly 500 short films every day

Earlier this year, Vigloo, a Korean microdrama production company, boldly brought AI into content production, betting that automation could fundamentally reshape filmmaking. In fact, with 30% of the budget for AI, Vigloo was able to create a program in just one month instead of three months, costing 1/5 of the previous one.

But this speed is still not as fast as Chinese companies. According to Neil Choi, CEO of Vigloo, competition from the giant short film industry from the “country of billions of people” is increasingly fierce, as the country is focusing its efforts on AI-based content.

China is currently a pioneer in microdrama, a type of film shown in vertical format, considered “television for the TikTok generation”. They have the same structure as a TV series but are divided into dozens of episodes, each only 1-2 minutes long, often ending with a shocking episode to attract viewers.

Theo ChinaDailymicrodrama is transforming China’s entertainment industry, having attracted 660 million domestic audiences by 2024, estimated to reach 100 billion yuan ($14.6 billion) in revenue by 2025. Part of the success of this type of drama is its low costs and quick production times, making it easier for studios to turn a profit compared to traditional scripted television.

With video creation AI tools becoming more popular, producing an episode is now simple. According to technology site 36kr, in January alone, more than 470 short films created by AI were released every day. Not only domestically, films have begun to expand abroad.

Data from analytics platform DataEye shows that AI movies with digital characters accounted for 38% of the top 100 manju movies (short films adapted from web novels, comics or original scripts) in January, up sharply from 7% in the same period last year. The total views of this category on the January chart reached 2.55 billion. According to ECNSaudiences are receptive to AI short films partly because the characters are becoming more realistic, reducing the “uncanny valley” effect – the feeling of discomfort with objects that resemble people but are not real.

According to Yuki Bi, CEO of brand consulting company Helios Worldwide, by 2030, the short film industry is expected to reach a value of 16.2 billion USD in China and 9.5 billion USD abroad. “The Chinese short film market has reached tens of billions of yuan each year, and works created by AI are taking a rapidly increasing market share,” Li told SCMP.

Position is strengthened

“Short films are a new business created by China, and the country’s companies are mastering the game,” Mr. Choi said. “It is very difficult to compete with businesses that are strongly supported and protected in the country.”

In fact, the short film industry in China is strongly shaping up. Besides a series of participating companies, many domestic technology “giants” are racing to produce many tools to serve. “A complete ecosystem is forming. This will be very difficult for other places to copy,” commented Professor Haiyang Li of Rice University.

In March, streaming platform iQiyi launched a tool called Nadou Pro. The platform connects production companies with actors willing to license their images to be used in AI-generated content. In September 2025, short video platform Kuaishou announced plans to support AI-generated short films. Around the same time, Tencent’s video department also launched an AI short film contest.

Meanwhile, ByteDance also significantly reduces the cost of creating videos by AI, with the Seedance 2.0 tool. TikTok’s parent company is working to develop more comprehensive systems, combining AI content creation tools with recommendation algorithms and advertising systems to create a single platform that can manage the entire production process, from scripting to distribution.

Authorities in some places are also involved in promoting the development of short films. For example, in Shanghai’s Pudong district, startups can receive computing support packages of up to 300,000 yuan ($44,000). In Wuhan city, the government provides preferential specialized loans. Many other localities also offer tax incentives, subsidies and support for graphics processing units (GPUs) to train AI models.

According to Helios Worldwide’s Bi, Chinese companies appear to be developing new content strategies that are markedly different from what Korean TV studios are doing, which is focused on producing a few “blockbuster” films.

“China’s approach shows that there are already possibilities or alternatives to the ‘Korean drama inflation’ crisis, that high-frequency, low-budget content can be more profitable than a single blockbuster,” Bi said.

Mixed reactions

As China’s microdrama industry strengthens, many controversies also arise. They are considered “painful” when the content is mainly shocking, view-seeking, and uncontrolled due to widespread production.

Besides, this type is considered a copyright violation, when many people use illegal images for movies. Nadou Pro – iQiyi’s tool for connecting content creators and actors – became the focus of this debate. The company said more than 100 artists had participated in the “AI talent database” on the platform, but a series of celebrities quickly pushed back, denying that they had signed any agreements related to using their images or voices for AI.

Responding to this issue, iQiyi stated that the names in the database “only reflect the artist’s willingness to seek out potential collaboration opportunities”. The company added that the use of images or voice “needs to be individually negotiated and a formal contract signed”.

Chinese regulators are also starting to pay attention to microdrama. The Cyberspace Administration of China has issued draft regulations on copyright issues related to AI, with more strict regulations expected in the coming years.

Some Chinese regulations state that platforms must control potentially harmful content. According to the China National Radio and Television Administration, if mandatory content censorship is not implemented, the video will be forcibly removed. Since early April, short filmmakers have also been required to register for a license, especially when using artificial intelligence.

Expert Zhao Zhanling of Beijing Javy law firm in Beijing said that if the platforms know about the violation but do not handle it, the affected party can report it to the Cyberspace Administration of China. However, he noted that some are trying to circumvent the law by registering temporary businesses and using servers abroad to hide their identities.

“For an industry that depends on rapid and scalable production like microdrama, intellectual property issues, if left unaddressed, could become a serious bottleneck, especially if owners react harshly, or legal standards become more stringent,” Fitch Solutions analyst Damien Yeo told Reuters. SCMP.