Kunlun Tech Says It Will Sell AI Short Drama at 40% of List Price for Three Years
Kunlun Tech’s chairman said what an AI episode costs to make, what its best titles earn, and what Kunlun will charge for the next three years. Two weeks from now its AI arm has to answer a copyright suit from ReelShort’s operator. DramaWave gains the most and passes Holywater. aTwist launched in eight countries on schedule. China’s micro-drama rule took effect, with a unified mark and the first six licences.
The Week in Review
Kunlun Has Put a Number on the AI Cost Advantage
Kunlun Tech published its own AI production cost on 2026-09-02. Its chairman put an AI episode made on SkyProduction at RMB 1,000 to 1,200 and a filmed one at RMB 10,000 to 20,000. Three AI-made titles each earn above $1 million a month. Kunlun will sell at 40% of list price for three years, and he expects live action to end up at 5% to 10% of everything made. Those are the company’s figures, given in an interview, and no one has audited them.
The independent measurement agrees on direction. DataEye counted 411,000 DramaWave ad videos in market in the week to 2026-08-30, more than any other overseas app, and found HotDrama, Kunlun’s third app, growing fastest. That count measures spend. DataEye’s chief executive said on 2026-09-04 that domestic short-drama return on ad spend has fallen to 1.03, meaning apps now get back barely more than a dollar for every dollar of advertising. The Paper (澎湃新闻), a Shanghai news outlet, reported on 2026-09-01 that 98.7% of AI dramas released on Douyin in the first half had not recouped within six months. Making an episode for RMB 1,000 settles the cost question. The hit rate has not improved.
Kunlun made that price commitment 19 days before a court deadline. ReelShort’s operator, Crazy Maple Studio, is suing Kunlun’s Skywork AI in the Central District of California over six DramaWave titles it says copy six of its own. The answer is due 2026-09-21 and the docket was quiet all week. Kunlun’s three-year discount rests on the cost advantage that ReelShort’s operator says was built by copying its titles.
The same week, the format arrived in three places it had not been. aTwist launched in eight countries, run by television-network veterans, with a Kevin Hart slate. It disclosed nothing about price or scale. Flipkart put micro-drama inside a shopping app in India. Redseer counts 15 to 17 million Indians already paying for the format in a typical month. China’s regulator switched on the rule that sorts every title into a licence tier by budget and labels every AI episode. Each of the three is a different bet. Kunlun’s price applies to all of them.
Visualizations
SBPI Stack Ranking
| Rank ▲ | Company ▲ | Tier ▲ | SBPI Score ▲ | Change This Week ▲ | What Moved It ▲ |
|---|
The Structural Brand Power Index evaluates 26 companies across five weighted dimensions: Content Strength (20%), Narrative Ownership (20%), Distribution Power (25%), Community Strength (20%), and Monetization Infrastructure (15%). Scores change only on public events with a date inside the seven days covered, here 2026-08-31 to 2026-09-06, measured against the previous issue, published 2026-09-01. Tier thresholds: Dominant 85 to 100, Strong 70 to 84, Emerging 55 to 69, Niche 40 to 54, Limited below 40. A change of 0.40 points or more in one issue is material. If a company misses a date it announced publicly, it loses points once, on whichever dimension the promise related to.
This Week’s Movers
Its content score went 61 to 62, distribution 87.4 to 88.4 and monetization 52 to 53, each out of 100. Kunlun updated SkyProduction, its AI video tool, on 2026-08-31 with an Agent mode and an Infinite Canvas workspace, and began charging on 2026-09-01 for its Wan 3.0 model at RMB 0.05 per second of generated video. Chairman Fang Han’s 36Kr interview of 2026-09-02 supplied the revenue figures: three titles clear $1 million a month, The Rise of the Lycan Queen past $10 million cumulative. DataEye’s weekly of 2026-09-04 placed DramaWave first in ad videos running, at 411,000. Its new AI title Oops, You Bullied the Alpha Queen was the only new entry above 1 million on the title chart. The revenue and cost figures are unverified outside Kunlun. Holywater, flat this week, drops to ninth.
Distribution 34 to 35, content 26 to 27. Tata Play Binge Shots, the streaming bundle of India’s Tata Play, added KLIP on 2026-09-02, its first distribution deal, alongside STAGE, Pocket Films, Bullet, BhaktiFlix and Vertigo TV. The joint release gave KLIP’s first catalogue figures: about 60 shows, 3,000-plus episodes and 6,000-plus minutes, mainly Hindi, with about 15 new shows a month. No commercial terms and no audience figure.
Distribution 27 to 28, content 26 to 27. Mansa launched three vertical series direct on TikTok Minis on 2026-09-02, its first distribution partner, and released two on 2026-09-04: I Married the King of the Streets with Serayah McNeill and Thomas Q. Jones, and My Twin Sister Stole My Life. Five of the ten titles in the slate it announced in April 2026 have now been confirmed. The Love Contract is announced and not yet live. No figures.
Distribution 87 to 88. Mansa’s three-title slate arrived on TikTok Minis after what Mansa describes as months of collaboration with TikTok’s team. China’s micro-drama rule took effect on 2026-09-01, with Douyin and Hongguo, ByteDance’s video app and its free drama app, the principal platforms governed. On 2026-09-03 screenwriters publicly accused Hongguo of withholding final payments under its Thousand Titles Plan, a script-commissioning programme. Hongguo had not responded by 2026-09-06.
Distribution 71.6 to 72.6. NetShort held eleven of the thirty places on DataEye’s title chart and ran 310,000 ad videos, second only to DramaWave. A third-party count, and NetShort’s first gain since July.
DramaBox’s Soy la Novia de mi Peor Enemigo, its first commissioned Latin American original, is streaming with 62 episodes. JioHotstar’s Tadka has a new title, DM Sahab Ka Revenge, confirmed by a 2026-09-05 review and the first new Tadka title since Reliance disclosed Game On: 4,000 Crore Empire on 2026-07-17. VERZA TV launched a Bollywood Collection of more than ten originals on 2026-09-01, thirteen days after its Espanol Collection, with no audience figure.
No Change This Week
ReelShort, 86.95. Vidio’s catalogue of more than 200 dubbed ReelShort titles was due live in Indonesia on 2026-09-01. Indonesian trade press reported the date and neither company has published a usage, subscriber or revenue figure. DataEye placed ReelShort fourth in ad videos in market, in the 50,000 to 100,000 range and well behind the top three, and third by growth in ad videos.
COL Group / BeLive, 52.70. Mango TV premiered what it bills as China’s first fully AI-generated long-form drama on the evening of 2026-08-31. COL Group’s shares rose 20% that day, the daily maximum on the Shenzhen exchange, and 23.66% over the three days to 2026-09-01. iReader and Haikan Media rose by the same daily maximum. TrueID promised a section for FlareFlow, COL Group’s overseas app, inside its TATANG app for September. It was not live on 2026-09-06, and TATANG’s home page still carries DramaBox.
Netflix, 67.55. Netflix’s own Clips page carries a 2026-08-25 note that the vertical feed is now available globally. Netflix says the feed is in every market it serves, and no market has a published usage figure. Amazon has not confirmed the full Prime Video Clips availability it promised for summer. Google’s 100 Zeros slate is six months from announcement with no premiere date.
Fifteen companies made no announcement: Disney, iQIYI, Holywater, CandyJar, Quick TV, GoodShort, Amazon, Google / 100 Zeros, ShortMax, Lifetime / A+E, GammaTime, Viu, Warner Bros. Discovery, RTP and Both Worlds. ShortMax has now been silent for four straight weeks, and Both Worlds since 2026-03-04. Quick TV’s Pratilipi catalogue deal turned out to be non-exclusive when Flipkart launched with the same studio on 2026-09-02.
Structural Gaps
Kunlun says an AI episode costs RMB 1,000 to 1,200 and that its July slate was more than 200 titles, over 90% of them AI. The Paper reported the same week that only 1.3% of first-half AI dramas on Douyin had recouped after six months. DataEye’s chief executive put domestic return on ad spend at 1.03. In July, 251 of about 45,300 Douyin-native AI and animated titles crossed 100 million plays, 0.55% against about 5% for live action. For an AI studio the constraint is now finding an audience, and that number has not improved.
Crazy Maple Studio, Reel Short LLC and New Leaf Publishing are suing Skywork AI, Kunlun Tech’s AI arm, in the Central District of California over six DramaWave titles, and the answer is due 2026-09-21. Nothing moved on the docket this week. Kunlun’s chairman announced a three-year discount on 2026-09-02 without mentioning the case. The plaintiff is ReelShort’s operator, ranked first. The defendant’s parent owns DramaWave, ranked eighth.
China now labels every AI episode, licenses every title by budget tier, sets authorization rules for AI likeness and voice, and since 2026-09-04 lets nothing a user uploads reach an audience unreviewed. The United States saw a platform launch and a studio slate on TikTok the same week. No union or regulator said anything. The SAG-AFTRA Verticals Agreement is the only Western agreement covering the format, and its last change was a pension and health rate rise to 22% on 2026-07-01.
Every platform giant stayed quiet this week. Netflix, Amazon, Google and Warner ended the week with no commission and no published figure. Netflix says Clips is global. Amazon has not confirmed the summer availability it promised. Google’s slate has no date. Disney is the only giant running a repeating original programme, and it still has no viewership figure for Locker Diaries: Descendants. TikTok’s Mansa deal is distribution of a slate Mansa paid for and owns.
Two of the Asian deals announced on 2026-08-26 and 2026-08-27 reached their first delivery date. A third deal, KLIP on Tata Play Binge Shots, was announced and went live on 2026-09-02. Vidio and ReelShort hit their Indonesian date and said nothing about how it went. FlareFlow missed its September date inside TATANG. Flipkart shows where the format goes next, into shopping apps, in a market where Redseer counts 15 to 17 million people paying each month.