From reels to real money: India’s micro-drama explosion faces tests

One day, the flatmates suddenly realize they had volunteered to host a retro movie-themed party that night. Thanks to suggestions from their social media app, they quickly put things together. But one of them is in for a shock when she realizes her former boyfriend is also on the guest list. And waiting at the front door. More such twists and turns follow in ‘Party of Two’, a micro-drama series on Instagram.

If it all seems rushed, it is meant to be so. Plot twists come in every couple of seconds, there is no time to linger on emotions or character development. The story arc moves fast, because each episode has a lot to say in less than a minute—the entire series comprises only seven episodes. The idea is to hook viewers and keep them scrolling from one episode to the next.

These bite-sized videos stream on Instagram and Meta. ‘Party of Two’ was developed in partnership with creative agency Communique, directed by Samudra Sengupta and Gopikrishnan Nair, and features amateur actors no one has heard of. Yet, it has to date garnered over 80,000 likes and thousands of comments per episode (the number of views don’t show up on Instagram).

These short, vertical-format videos, known as micro-dramas, are made primarily for the mobile screen. And they have grabbed viewers by the eyeballs—over the past 18 months, millions of Indians across the country have become addicted to these shows, which for the most part are lurid romances. According to media consulting agency Ormax, the new content format has established a meaningful footprint in India, amassing 73.2 million viewers in less than a year of existence.

Most shows run anywhere from 30 seconds to three minutes per episode, and seasons are flexible. Makers can drop 20 episodes or 200, depending on the arc. It’s storytelling built for the mobile phone, not the living room.

Grabbing a piece

With India gripped by this micro-drama boom, film and television companies, struggling in their usual playing fields, have also jumped on the bandwagon to produce these bite-sized clips.

Ekta Kapoor’s Balaji Telefilms Ltd has launched micro-dramas under the brand Kutingg, while Zee Entertainment Enterprises Ltd has acquired a stake in content and tech startup Bullet, which has developed a micro-drama application featuring fast-paced, vertical-format episodes designed for younger audiences.

Several other companies, such as Story TV, TukTuki and ReelSaga, have ventured into the same space, as have existing storytelling platforms, including Terribly Tiny Tales.

The ecosystem is also throwing up massive opportunities for talent on the sidelines, from writers and actors to technicians.

But many of these companies may have bitten off more than they can chew. The format may not exactly be the panacea to all the ills currently plaguing the entertainment industry.

Myriad challenges

Micro-dramas are low-cost affairs with astonishingly quick turnaround times. The format first emerged in China in 2018 and has grown increasingly popular over the last few years in other global markets. The videos tend to be snacky, inexpensive to make, and are often tacky productions. The majority are frothy love stories, family dramas and soap operas with fantasy elements.

In India, micro-dramas lean heavily on the free-video economy, with 75% of their viewers coming from AVoD (advertising video-on-demand) segments, closely mirroring the profile of the overall OTT (over-the-top) universe. Rural India contributes 55% of the viewers.

Companies make money primarily by advertising, but are increasingly also seeing brands come on board to be integrated into the narrative. Some are also experimenting with short-term subscriptions, where users unlock a limited number of episodes by paying for them.

These efforts aside, monetization remains difficult for now. The category has no precedence in India and like long-format OTT content, it could be a while before bona fide success stories or formulae emerge.

Clutter and consequently, discoverability, are among the biggest challenges for micro-dramas. There are far too many companies in the space and it is not clear what works.

Moreover, creating an episode for ₹1-2 lakh could obviously result in lowbrow programming that barely moves the needle in terms of breakout content from India in the cluttered global content environment.

Monetization challenges

As things stand, there is no clear monetization strategy for the format—digital advertising remains nascent, paid subscriptions have already plateaued, and viewers are still unfamiliar with micro transactions.

The biggest challenge as far as micro-dramas go is building a monetization model that respects the audience experience, according to Azim Lalani, co-founder and chief business officer, Bullet. “Subscription models don’t fit short content, and traditional advertising formats can interrupt the flow. The opportunity lies in creating native brand integrations that blend seamlessly into the story," Lalani added.

Digital advertising in India continues to remain sluggish despite many streaming platforms, primarily driven by subscriptions, increasingly pivoting to ad-driven models. In fact, American streaming platform Netflix has said that the markets where it offers ad-supported tiers account for 80% of its global ad spending, highlighting the challenges faced by OTT advertising in India, a market where it doesn’t offer ads.

Besides contending with low cost per mille (CPM), or cost per thousand impressions, linear television and e-commerce remain major rivals in capturing impressions and audience attention.

Moreover, the Digital Personal Data Protection Act, 2023 (DPDP Act) passed by Parliament could dent ad monetization because of restrictions on the use of personal data, particularly the prohibition of targeted advertising and tracking of children’s data. This may disrupt revenue models heavily reliant on behavioural advertising and personalized content recommendations, forcing a shift towards subscription-based or contextual advertising models, according to industry experts.

Lastly, as far as challenges with advertising go, India now ranks third globally in ad fatigue, behind only the US and Australia, according to a recent report prepared by The Trade Desk, a US-based tech platform that allows advertisers to buy digital ad space. Seven in ten Indian consumers are mentally tuning out digital advertisements by skipping, muting or ignoring them altogether, as fatigue mounts, the report, released this August, said.

However, many believe the future of monetization in micro-dramas lies in hybrid models thaet combine storytelling, interactivity, and participation.

Bullet’s Lalani said brand partnerships need to be integrated into the narrative rather than appear as external breaks. “Gamified engagement lets viewers unlock episodes or participate in missions that make advertising a part of the entertainment," he added. “Low-cost unlocks, branded seasons and in-app fan clubs can offer multiple revenue streams beyond traditional ads. Ultimately, success will come from creating inclusive, interactive entertainment that keeps both audiences and brands equally invested in the experience."

Anshita Kulshrestha, founder, TukTuki Entertainments, a homegrown micro-drama mobile entertainment company, said the company is focused on a clear path to profitability and expects to be on track to achieve this within 24 to 36 months. “This viability is driven by our lean production model, which ensures better unit economics than traditional formats. We are confident in achieving key milestones swiftly, especially by the second year of operations," she added.

TukTuki manages funding and revenue through advertising and subscription, Kulshrestha added, with ads being the primary revenue driver in the early phase. The platform offers a free, ad-supported tier to ensure accessibility to everyone and also provides a subscription plan for an enhanced, uninterrupted viewing experience for a fee, which she said, is affordable even for lower-middle-income households.

What will work?

The other big concern for the micro-drama industry is that just like the long-format streaming world, which Indians were exposed to only around 2016, nobody really knows what genres and storytelling techniques will work and should be bet on.

Senior industry executives say a theatrical film works on the premise of one hook (plot twist or some drama/conflict) per hour while television needs one per 10 minutes. In contrast, in a micro-drama, there has to be one plot twist per minute for viewers to keep coming back. That could lead to a very specific, odd, rather gimmicky storytelling style, not necessarily profound or high-quality content. In fact, as more platforms attempt plots based on artificial intelligence (AI) prompts, audiences aren’t likely to see any breakout programming at all.

Nitin Burman, group chief revenue officer, Balaji Telefilms, said that for companies solely into micro-dramas, the space is critical. Companies invested in the space are currently releasing more than 30 to 40 micro-dramas a month.

“Quality control could be an issue in the micro-drama space. The kind of talent required to write or even feature in such shows may not be concentrated in one space, as is the case with the Mumbai film or TV industry. You will need people with a different bent of mind," said Girish Dwibhashyam, a streaming industry expert and former vice-president and chief operating officer of DocuBay, a documentary-streaming service.

However, Anuj Gosalia, founder and chief executive officer (CEO) of Terribly Tiny Tales, said audiences, especially younger users, love the quick, emotional hit symbolic of micro-dramas: strong hooks in the first few seconds, relatable characters; and cliffhangers that make you watch “just one more."

Local language content is exploding, and vertical, mobile-native formats work best. Fast releases and tight pacing are winning; anything that drags loses viewers instantly, Gosalia added.

Saurabh Pandey, founder and CEO of Story TV, a micro-drama app, added that the audience profile for the category is also broadening. “Close to 40% of our viewers are women, which is a big shift from the traditionally male-skewed online video landscape in India. This balance signals a much wider emotional connect and appeal for micro-drama formats," he said.

“In terms of genre, thrillers, fantasy and family dramas are the top performers. These categories translate naturally into short, high-intensity chapters that keep viewers coming back multiple times a day."

Need for diversification

To be sure, experiments with new and unexplored formats such as micro-dramas are driven by industry realities. With streaming platforms cutting budgets and the box office still tepid, traditional media and entertainment companies are doing whatever they can to stay afloat.

Abundantia Entertainment, known for films such as Baby, Airlift and Toilet–Ek Prem Katha, launched a new division in October dedicated to developing and producing stories powered by AI, called Abundantia aiON. Balaji Telefilms has launched AstroVani, an astrology app, besides Kutingg. Music label Saregama has also ventured into live events, while Banijay Asia, best known for ‘Bigg Boss’ and ‘MTV Roadies’, has partnered with Collective Artists Network to launch a creator-led content and IP (intellectual property) engine.

While some believe these initiatives are driven by shortening attention spans, others feel there is space for all kinds of programming to thrive in the current fragmented content environment.

“I don’t think there’s an issue with attention spans. However, there are multiple options to consume content of different kinds, from short form to Reels to long form. The viewer today is spoilt for choice, which I think is great," Saugata Mukerjee, head of content at Sony LIV, told Mint in a recent interview. “This will ensure that the makers of long form work harder to ensure that their storytelling is unique and that there are fewer drop-offs."