Investors are scrambling for AI dramas now.

No real human actors, no live-action shots, all frames are generated by AI — recently, *The Later Journey to the West*, China's first AIGC drama series broadcast on satellite TV, premiered on Hunan TV's prime time slot.

The capital market was the first to react. On the premiere day, its producer Mango Excellent Media hit the 20% daily limit and stayed firm, followed by several consecutive days of share price rise, with a short-term increase of nearly 50%. Meanwhile, HuaRui Century notched 4 consecutive daily limit gains, Bona Pictures recorded 3 daily limit rises in 4 trading days, Happiness Blue Ocean rose by more than 10%, and media stocks including Dasheng Culture, Zhongguang Tianze, Enlight Media, and Zhangyue Technology all rallied in tandem.

A 900,000-yuan per-episode cost ignites market enthusiasm

Speaking of which, why is the market so excited about an AI drama with no real human actors?

It is reported that *The Later Journey to the West*, generated by ByteDance's Seedance series of models, is adapted from the classic IP *Journey to the West*. The series has 30 episodes in total, each lasting 40 minutes, and adopts the mode of "production, review and broadcasting in parallel", with a production cost only 1/10 of that of a live-action drama of the same scale.

According to the director's interview, the production cost of *The Later Journey to the West* is about 900,000 yuan per episode, and the total cost of the 30-episode series is roughly estimated at 27 million yuan. In comparison, ordinary S-level mythological live-action dramas usually cost more than 10 million yuan per episode, with a total investment of over 200 million yuan; the cost of traditional 3D animation is also far higher than that of this AI work.

More importantly, the exquisiteness of this AI-generated animation has exceeded many people's expectations. In related discussions, many netizens said that the grand scenes such as the Mountain of Flowers and Fruit and the Heavenly Palace have excellent AI image quality, and some frames are even comparable to "movie-level" quality; some netizens also pointed out that Mango TV's move has directly verified the implementability, satellite TV broadcast eligibility, and full-scale commercialization feasibility of AIGC technology, completely breaking the industry's stereotype of AI content as "low-quality, niche, and nothing more than conceptual hype".

On the other hand, an AI entrepreneur revealed to me that the virtual characters of AI short dramas incubated by his team are achieving dimensionality reduction attacks on a large number of real-life internet influencers with millions of followers in terms of commercial quotation at extremely low marginal cost.

Take a recently viral AI short drama as an example. Its leading actress "Fang Taozi" has only debuted for one month, and her quotation for a commercial ad longer than 60 seconds has reached as high as 258,000 yuan, surpassing a large number of real-life internet influencers with millions of followers. This figure not only changes the current gameplay of AIGC video content, but also becomes a landmark event for AI to reshape the commercial value of content.

After the AI drama starring "Fang Taozi" accumulated more than 250 million total views on Douyin, she quickly rose to fame. In addition to acting, "Fang Taozi" also opened a personal social account off-screen, posting daily vlogs, filming tidbits, and documentary content such as "starting work" and "finishing work" in the identity of an AI, just like the operation of a real celebrity. At the same time, by building an independent IP, "Fang Taozi" also appeared on the cover of the digital issue of the mainstream fashion magazine *COSMO* across fields.

Her personal social account has gained 420,000 followers and more than 28 million likes in less than two months since the first video was posted. It can be said that the path of AI short dramas from "creating stars through drama series" to "IP operation" and then to "commercial monetization" is being rapidly verified.

The primary market starts "snatching shares"

The boom of AIGC videos has also spread to the capital circle.

Compared with the drastic fluctuations in stock prices in the secondary market, the primary market is moving faster. On the last day of August, Kuaishou released an announcement stating that the National Artificial Intelligence Industry Investment Fund and Zhengda Robot invested 1.4 billion yuan and 131 million yuan respectively in Keling AI. In July this year, Keling AI completed an independent financing of nearly 3 billion US dollars, with its post-investment valuation soaring to 18 billion US dollars.

The underlying video model track is also bustling. In July, Shenshu Technology completed a new round of financing of 500 million US dollars. Before this financing, its Vidu model had been embedded into the AI drama production processes of many companies including Wondershare Technology, forming a closed loop from technology to application. In the same month, Aishi Technology quickly completed its C+ round of financing, and then the unicorn made a move in August, making a strategic investment of several million US dollars in Folding Vision, an AI + live-action hybrid drama production company, further extending its reach to the content end.

The implementation of a series of financings reflects the strong appeal of the AIGC video track.

An investor focusing on this field analyzed to me that the core reason why institutions dare to place heavy bets at this point can be summed up in two words: monetization. Specifically, B-end companies can generate rapid cash flow through API interface charging, pre-visualization for film and television industrialization, and advertising material generation; C-end creators can achieve short-cycle commercial monetization through tool payment, template revenue sharing, and platform traffic subsidies.

"Fang Taozi" is a vivid example. With a 258,000-yuan quotation for a 60-second commercial order less than a month after her debut, she has outperformed many internet influencers. Now, her monetization territory has expanded to: in addition to AI short dramas, it also includes Xingtu commercial orders (short video ads), brand endorsements, even live-streaming marketing, magazine covers, and IP derivative licensing. Previously, in the live stream, Fang Taozi directly marketed for contact lenses and FMCG products, and diverted traffic for brands with words like "the same style" and "I use it myself", easily earning slot fees and revenue sharing; later, she appeared on the cover of the digital issue of *COSMO* as an independent IP, which can be called a "virtual top streamer" in the AI era.

Looking further ahead is the market of content IP. The above-mentioned investor said that AI-generated short dramas, long dramas, and comic dramas, combined with platform revenue sharing, ad placement, games, interactive film and game derivatives, will bring considerable long-tail returns. Mango Excellent Media's *The Later Journey to the West* has blazed a trail between large-scale production and commercialization.

The data also seems to echo this judgment. According to DataEye, an industry research institution, in the first five months of 2026, the market size of domestic AI short dramas/comic dramas has exceeded 220 billion yuan, and the full-year figure is expected to surpass 400 billion yuan; looking at the entire short drama market, the total size is expected to reach 1.2 trillion yuan this year.

Chinese AI dramas are being sold to the global market

With the intertwining of multiple variables, Chinese AI dramas are also accelerating their penetration into the global market. In particular, among the top 20 overseas short drama apps ranked by revenue, 90% of them have Chinese backgrounds.

For example, Kunlun Wanwei's AI short drama platforms that have already gone global — DramaWave and FreeReels, recorded a monthly revenue of over 65 million US dollars in June this year, firmly ranking first in the overseas short drama market. The same goes for FlareFlow, a wholly-owned overseas short drama platform under Chinese Online. After going global, it successfully turned losses into gains in the first half of this year, recording a revenue of about 252 million yuan and a net profit of as high as 152 million yuan, with the net profit margin exceeding 60% at one stroke.

Although going global has become the industry consensus, the threshold is not low.

An entrepreneur in the AI video field told me that the overseas expansion of AI dramas is by no means as simple as "one-click translation" or "AI face swapping". The continuous tightening of requirements for localized narrative, cultural adaptation and content compliance in European and American markets has made deep localization a prerequisite for entering high-end markets. This also means that it is not easy for small and medium players to get a share of the market.

The above-mentioned AI video entrepreneur admitted that audiences in different overseas regions have very different tastes for content. The dislocation of aesthetic standards brought by multi-ethnic cultural differences, blind spots in overseas distribution, and content compliance requirements pose extremely high challenges to the team's localized operation capabilities.

To put it another way, even in the domestic market, not everyone can enter the game. The entrepreneur said frankly: The current competition in the industry is not "insufficient production capacity", but lies in the content itself: the polishing of high-quality scripts, the consistency of character output, and the continuous stability of core narrative, all of which have become the most scarce resources.

In his view, now AI has solved the problem of "how to shoot", but "what to shoot" and "who the work is for" ultimately depend on the capabilities of "human beings".

This article is from WeChat Official Account "China Investment Network", Author: Chen Mei, Editor: Wang Qingwu, published with authorization from 36Kr.