India’s Microdrama Boom Is Here, But Can The Unit Economics Work?

With short-form content everywhere, a three-hour movie now feels like a commitment. That is where microdramas have entered the picture. 

Think of microdramas as an evolved version of soap operas designed for fast-paced generations, not for television screens, living rooms or two-hour movie slots, but for phone screens. Microdrama episodes are shot vertically and are built around cliffhangers, emotional reversals and rapid storytelling.

The format originated in China, where it has grown into a multi-billion-dollar entertainment business. India, meanwhile, has just begun its microdrama journey, with startups entering the space and larger entertainment platforms following suit.  

The opportunity is significant, as India’s microdrama market is projected to be at ₹650 Cr and is expected to grow at more than 50% annually through 2028, according to the report “Stories, scale and impact: Unlocking India’s media and entertainment economy” by FICCI and EY India.

Microdrama platforms are competing for the same attention as Reels, YouTube Shorts and other short-form platforms, while rising customer acquisition costs and India’s difficult subscription market are putting pressure on their economics. 

A year into the boom, the industry stands at a critical crossroads, asking whether microdramas can turn fleeting attention into a sustainable business.

Not Just Another Chinese Playbook

India’s first year with microdramas has already challenged the assumption that the country would simply replicate China’s playbook. While the basic format remains familiar — short vertical episodes, high emotional intensity, frequent cliffhangers and stories designed to keep viewers coming back — the audience, storytelling and consumption patterns are becoming distinctly Indian.

“India isn’t simply following the global microdrama playbook… it’s creating one of its own. The format may have come from China, but what works in India is very different. Audience tastes, storytelling, languages and even pacing have all evolved in uniquely Indian ways,” said GSN Aditya, COO at Eloelo Group, which runs microdrama platform Story TV.

Talking about the scale, Amit Zunjarwad, chief product officer at ShareChat and Moj, said that 80% of users in the ecosystem prefer microdramas, putting them on par with short-form video. About 86% spend more than 15 minutes watching them every day.

Across Moj, ShareChat and QuickTV, Zunjarwad said that the ecosystem now delivers approximately 900 Mn daily episode plays, equivalent to more than 720 Mn minutes of microdrama consumed every day.

Story TV’s Aditya claimed that users spend more than 95 minutes a day on its platform, while its audience has expanded beyond scripted dramas into reality formats, daily episodic releases and original franchises across five Indian languages. The company says it now has more than 2,000 shows and launches around 150 new titles every month.

According to industry experts, 68% of microdrama viewers belong to households earning more than ₹10 Lakh annually, suggesting the format is increasingly becoming a mainstream entertainment proposition for the masses.

The format is finding traction beyond metros, particularly in smaller cities where smartphones have become the primary entertainment screen. According to the FICCI-EY data, 60-75% of microdrama users are from tier II and tier III cities, while around half prefer content in their native languages.

According to ShareChat, more than 40% of episodic consumption in its ecosystem happens in regional languages. Around 36% of audiences prefer stories based on everyday life, while 34% prefer stories reflecting realities from different parts of India.

In other words, audiences are not simply asking for Chinese-style stories translated into Indian languages. They want culturally relevant characters, situations and narratives. 

Anshuman Mishra, cofounder of microdrama streaming app Reelies, said the category is still being defined, with many platforms and content creators using “microdrama” as a catch-all term for short scripted videos.

Rising CAC Tests Unit Economics

The paradox of microdramas is straightforward. They are cheap to make but expensive to scale. A microdrama series can be produced at a fraction of the cost of a conventional OTT series. One microdrama founder said a series can cost around ₹10-15 Lakh to produce, compared with several crores for an OTT production. Such low cost creates an unusually low entry barrier for startups.

The real expense comes after the show is made: getting viewers to discover it, keeping them engaged and, eventually, persuading them to pay. This is where customer acquisition cost, or CAC, has emerged as the sector’s biggest headache.

The first generation of microdrama startups had an advantage because content production was inexpensive and the category itself was relatively uncontested. The acquisition battle intensified when more platforms entered.

Artist fees have also risen as larger platforms enter the segment and offer higher pay for talent. However, one industry source estimates that overall production costs have increased by only 10-20%, while customer acquisition costs (CAC) have risen much more sharply.

“Acquisition is the game in this business. Unless you can crack acquisition, you will not be able to survive. Whoever knows acquisition will be able to do very well in this space,” Mishra said.

This is where platforms such as ShareChat and Moj have an inherent advantage. Instead of acquiring every microdrama viewer from scratch, they can plug the format into existing social feeds and recommendation engines.

Zunjarwad said ShareChat’s user acquisition cost is approximately ₹7, with payback achieved within four to five months. At the same time, infrastructure costs have fallen 75-80%, while server costs per user have declined by nearly one-third.

But for specialist microdrama apps, building a similar distribution layer remains much harder.

Kuku TV, Story TV and Quick TV emerged as the early prominent players, while larger entertainment companies have increasingly entered the segment. JioHotstar has launched Tadka, Zee Entertainment has Bullet, Tata Play has Shots, and Amazon MX Player has MX Fatafat.

The arrival of larger platforms poses a clear threat to startups. But it also solves one problem: awareness. For a category that was barely known to Indian consumers a year ago, having major platforms advertise microdramas can help create the habit of consuming the format.

Mishra of Reelies said that larger platforms may not necessarily be producing good microdramas yet, but their presence is helping establish the category. 

In addition, most specialist microdrama apps have relied heavily on subscriptions, in-app purchases and freemium mechanics. But India’s history with digital subscriptions suggests that downloads and paying users can be very different things.

“Currently, the challenge for the Indian microdrama market is CAC. Most of these models run on subscriptions, and what we’ve seen in India is that subscription models do not work as well. People want to stream for free, but the minute you ask them to pay, that is where the challenge comes in,” said Ananay Jain, partner, media and entertainment, Grant Thornton Bharat.

This creates a peculiar business equation. A platform may have millions of downloads, high completion rates and significant watch time and still struggle to generate enough revenue to justify its acquisition spend. In other words, microdrama has yet to solve the monetisation problem.

Meanwhile, Zunjarwad believes that recommendation-led discovery and advertising are becoming important monetisation levers, with subscriptions serving as an additional revenue stream. That is why advertising could become increasingly important across the sector. Advertisers are already testing the format, but it is still early. For now, brands are more likely to allocate a small experimental portion of their budgets than make microdrama a core channel.

The Next Challenge: Building An IP That Sticks

If microdrama platforms cannot rely indefinitely on subscription revenue, their next challenge is figuring out what makes a viewer stay. This is where the industry’s evolution from “content format” to “content business” becomes visible.

The first phase was about producing as much content as possible at a low cost. The next phase could be about building an IP.

“Over time, distribution alone will not be enough. The winners will be the companies that consistently create memorable IPs, build franchises audiences come back to, and combine creative excellence with technology to scale efficiently,” said Story TV’s Aditya. 

Zunjarwad argues that the eventual winners will not be defined by content, distribution or technology alone. The winners, he said, “will be those that can combine differentiated content, vast and diverse distribution, and deep technology, rather than rely on any one advantage.”

A generic pan-India story may struggle to compete with a drama that speaks directly to a specific audience in its own language and cultural context.

“The content has to be localised. You cannot have general content like an OTT platform, which everybody in India is watching. It has to be specific to the language, the age group or the target audience,” said Jain of Grant Thornton Bharat.

This is where India’s linguistic diversity becomes an opportunity rather than simply a challenge. Hindi may offer scale, but Tamil, Telugu, Bengali, Marathi, Bhojpuri and other languages can create highly targeted audiences that mainstream OTT platforms may not always serve with the same frequency.

A show does not need to cost tens of crores to justify itself. It can be produced cheaply enough to target a narrower audience and still potentially make economic sense if distribution and monetisation work.

Finally, technology is pushing these economics further. AI is already entering the production workflow, although its role remains more about reducing turnaround times and operational costs than replacing writers, actors or directors.

For Story TV, AI is helping its teams move faster and execute at scale. “AI is not replacing creativity, but helping teams move faster and execute at scale.”

According to industry experts, production costs will fall further if AI-assisted production becomes more widely accepted.

But the next two to three years will likely be less about whether microdramas can grow and more about who can capture the value created by that growth.

Zunjarwad expects the category to become an established part of India’s digital entertainment ecosystem, with greater depth across languages, genres, content IP and AI-led production.

He also expects the market to support both scaled platforms and specialised businesses. Platforms with large audiences, established recommendation systems and monetisation infrastructure will have an advantage, but niche players can still build defensible businesses around specific languages, genres or audiences.

For now, the microdrama opportunity is clear: India has millions of users willing to spend significant amounts of time consuming bite-sized scripted entertainment. The harder question is whether that attention can translate into repeatable revenue.

[Edited by Shishir Parasher]

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