China’s Overseas Short Drama Industry Booms in 2025, AI and IAA Drive New Growth

The overseas short drama industry in China witnessed robust growth in 2025, with soaring downloads, rising revenue and expanding global reach, according to the “2025 Annual Report on the Overseas Short Drama Industry” released at the 13th China Network Audiovisual Conference recently.

The report shows that the total number of downloads of overseas short drama apps reached 1.199 billion in 2025, a year-on-year increase of 268%, while the total revenue hit 2.329 billion US dollars, up 133% from the previous year. The number of active markets expanded from 37 at the beginning of the year to 46, demonstrating a distinct globalization trend.

As the market expands rapidly, the competitive landscape has accelerated differentiation. Oriental IC reports that DramaBox and ReelShort, two short drama platforms owned by Chinese enterprises, have remained the top players for two consecutive years. However, among the top 10 mid-tier apps in 2025, five experienced double declines in downloads and revenue, all developed by Chinese teams.

New entrants showed a clear “fast in and fast out” feature: 74 new apps were added throughout the year, while 19 small-scale apps withdrew from the market, most of which were pilot platforms focusing on the Southeast Asian market and relying on low-cost dubbed dramas. Cost pressure also intensified in 2025. In North America, the largest application market for Chinese short dramas going overseas, the production cost of local dramas rose by 10% to 20%, with a single drama costing 250,000 to 300,000 US dollars.

In Japan, the second-largest market, costs increased by 20% to 30%, driven mainly by the intervention of trade union systems, salary premiums for top creators and the transformation towards high-quality content. To break through the predicament, AI technology and the IAA (In-App Advertising) model have become key drivers of growth.

Public information indicates that TikTok has incubated dozens of AI short drama accounts, with the highest playback volume of a single drama exceeding 600 million views and AI short drama revenue sharing surpassing 2 million US dollars in the first quarter of 2026. In 2025, the proportion of IAA short drama app downloads jumped from 4.7% to 24.7%.

Sensor Tower data shows that FreeReels, a free short drama app under Kunlun Wanwei, performed impressively, with downloads increasing by 137% month-on-month to 115 million in the first quarter of 2026, topping the short drama app download list for three consecutive months and exceeding 200 million cumulative global downloads, mainly driven by growth in India, Southeast Asia and Latin America. Kunlun Wanwei also disclosed that its two platforms FreeReels and DramaWave achieved a total monthly revenue of over 280 million yuan in January 2026, ranking among the top in the global overseas short drama track.

China Online submitted an application for listing on the Hong Kong Stock Exchange in February 2026. Its overseas short drama platform FlareFlow ranked second globally in monthly active users in the first seven months, with over 33 million registered users and monthly top-up exceeding 10 million US dollars. iQiyi reports that China Online’s IP derivative revenue reached 237 million yuan in the first half of 2025, a year-on-year increase of 46%, and AI tools have increased IP monetization efficiency by more than 10 times. Other Chinese enterprises, including iReader Technology and China Mobile Migu, are also accelerating their layout in the overseas short drama market.