Two-Thirds of Microdramas Outside China Are Now AI-Generated

Owl & Co's report What We Watched on Vertical, covered by The Hollywood Reporter, found that roughly two-thirds of the vertical dramas released outside China in the third quarter of 2026, across 20 top platforms, were AI-generated, up from 28 percent in the second quarter and 3 percent in the first. In China more than 95 percent of titles were already being made with AI. The audience followed: AI titles dominated the minutes-watched rankings on the paid apps, led by ReelShort's The Great and Powerful Genie, and only one live-action series, ReelShort's My X-Ray Vision Sees Right Through You, made the top five.

In nine months the format had gone from almost no AI to mostly AI. The report measured releases and viewing, not profit or what audiences thought of synthetic actors, and in China the same boom had left most productions failing to recoup their costs. But the phone-first serial, cheap, fast and endlessly produced, had become the first mass-market format where AI was the norm rather than the exception.