Dramas

Laugh at vertical dramas’ alpha werewolf pregnant billionaire storytelling all you want, but don’t let the giggling distract you. Vertical dramas are massive.  

For young filmmakers they offer a low-barrier entry point. For entrepreneurial producers, they’re a chance to become mini-mini moguls. In 2024 alone, over 36,000 new series launched. Already a $7 billion business in China, the market is projected to top $10 billion globally (outside China) by 2027. 

Enter MicroCo

Last month, Cineverse — the folks who brought you “Terrifier” — and Lloyd Braun’s Banyan Ventures announced MicroCo, a new microseries studio and platform. 

Co-founder: Former Showtime president Jana Winograde 
Chief Content Officer: Susan Rovner, CEO and former NBCUniversal TV & Streaming chair 
Cineverse: A business built on dozens of FAST channels (Screambox, BloodyDisgusting.com, AsianCrush, The Bob Ross Channel). 

The ambition isn’t to be another ReelShort or DramaBox. It wants to be the Amazon Prime of vertical drama, producing originals and curating the best from thousands of existing titles. 

Why It Matters

I spoke with Cineverse president and Chief Strategy Officer Erick Opeka about MicroCo’s ambitions and why he sees vertical dramas as the next inflection point. 

Full disclosure: I’m excited to see what happens with vertical dramas and I’m a little bit conflicted about that. This is filmmaking at its most disposable. For this format that’s a feature, not a bug. It’s storytelling that leans into the dopamine with cliffhangers every two minutes; logic and nuance are roadkill.

China can’t create a $7 billion business without America taking notice, but we might be slower to respond if we weren’t living through a moment otherwise defined by layoffs, consolidation, and other forms of retreat (Neuehouse, RIP). Growth feels good. Like it or not, this is a ground floor — but not for long.   

My interview with Erick has been edited for brevity and clarity. 
  
In Development: When did vertical video first cross your desk?  

Erick Opeka: A couple of years ago. In another incarnation we were owned by a Chinese company, so we’ve always been keeping an eye on trends. It was starting to pop up around the same time TikTok started to take hold. I saw it start to be something we were interested in maybe about 18 months ago. 
 
What do you see as the potential for this?  

If you look at the evolution in China, it’s not just targeted toward women looking for romance. About 550 million people in China viewed vertical microdramas as of the summer of this year. It’s gotten so big that it’s stealing mindshare from the more legacy streaming services. It’s resonating with their daily use patterns and cadence and mobile-first society. 

The pattern we’re already seeing in the US — the very soapy stuff taking hold, becoming a billion-dollar business in the US, and the top apps beating out Netflix and Hulu and Disney in the app store in revenue generated — tells me over the next five years, you’re going to see that happen here.  

What’s compelling is there’s no ecosystem around this in the US today, even though it’s already a billion-dollar business. I hear anecdotal things, but there’s no PR channels, no IMDB for this stuff.  And these things are like mayflies, right? They premiere, they get mined of their value in two to three weeks, and then they’re into the ether and it’s on to the next one. It kind of hearkens back to the early days of cinema and the nickelodeon, and there was no star system yet. You had the Biograph Girl. It parallels a lot of what you would see in the early development of a new medium. 

Our goal is to build out the Roku or Amazon Prime of the space for the US. The other opportunity is there’s a lot that are clearly not professionally produced storytelling. It’s not so much the production value, but how do you maximize the storytelling?  

Putting together a team like Susan, Lloyd, and Jana, they understand big, brash storytelling. We’re not coming in with any kind of hubris that we’re going to reinvent the format. The format works. It’s about going back to the basics and doing a better job with western-style storytelling for US audiences. 
  
How would you distribute this? 

You have to have your own app to be a credible player. We’re a tech company. I have the engineering team and staff. We operate hundreds of apps in the ecosystem, so this is not something that is unfamiliar to us.  

The other piece is what I’ve seen as TikTok evolved into a multi-platform media company. They have connected TV apps, they have smart TV apps. It’s growing quite fast. I didn’t think vertical video on a big TV was going to work, and it’s kind of working to some degree. It’s just weird. Maybe people want to use their phone to text and goof around, and these stories are light engagement.  

The other thing is if we serve as the Hulu or Amazon or whatever analogy you want to make, there is no catalog value to most of these things. [We’d be] aggregating them, providing the fan layer, providing the information so people can find them. We’d also be working with major media companies, mobile providers, and others to provide our app or create a custom version of the content. We’d also produce, much like Prime, a nice layer of premium things.  

A lot of people see the team we’re putting together and think this is somehow going to be some ludicrous overspending. It’s quite the opposite. It’s like a puzzle we’re all trying to solve: How do you do what is already being done, without spending much more, and just do it better than it’s being done? There’s no need to put A-list talent in a $250,000-produced micro drama. This audience isn’t going to resonate with that, anyway. 

I think microdramas are going to serve a two-way approach. One is IP that will graduate into bigger phenomenon, and bigger IP will make the format stay top of mind — rather than going to the movies two or three times a year for most Americans. But it’s got to graduate from Harlequin romance-style stuff.  
Don’t get me wrong, we’re going to play that up. If you saw the names of some of the shows we’re contemplating — we’re like, how do we one-up everybody at this game of just getting ridiculous with it? We’re going to have fun with it.  
  
Are you looking to produce, or is this going to be acquisitions of independents? What’s the plan there? 

It’s going to be a mix. We’re starting to see some companies and producers that are getting really good at this. Most are kind of outside the system [or] recent film school grads from top programs that have been trying to break in. They’ve gotten good at scaling and figuring out how to do it. Very entrepreneurial. Some of the top producers in the space have very little to no Hollywood background. These are all indies. 
  
Right? I interviewed one of the vertical filmmakers, Yun Xie. She was fascinating. She made a feature that won Slamdance. 

Really? 
 
Yeah. And she was awesome. She’s a powerhouse. I was so impressed by her energy. So many directors come off as brash. That’s not her, but she’s very clearly focused. 
You hit the nail on the head, right? If you look back to the ‘90s indie film world vibe of just how excited people were and they were excited to get up every day and try to figure out how to get their movie and just crack the space. There was a palpable excitement around it. I feel that same kind of energy. 
  
I agree.  

People feel like, not only do I have a shot to get things made and do things and move forward with something that’s fun, compelling and new, but there’s real money to be made. I mean, you got to make a lot more of them to make money, but the money that’s being spent in this space is not immaterial anymore. 
  
What kinds of budgets are you looking at? 

The numbers have been all over the board and a lot of it reflects the indie film world. Cheaper it is, the more sweat equity and favors are being called — they’re doing these for below six figures. The price point is settling anywhere between $150,000 and $400,000. There’s people who are starting to become known and those cost a little more. And just because it’s a white-hot space, there’s not a ton of experienced producers. Demand is outstripping the supply, driving up prices a little bit right now. 
  
How many do you think you’ll produce or release in a year? 

We’re still working on that number. We’re going for a little higher quality as opposed to quantity. I don’t think we’re going to be at the cadence of the top players that drop one microdrama a day. But maybe one a week. Maybe two a week, toward the back half of our first year. 
  
How are you going to handle payment? There’s this whole system of coins and you lose track of what you’re actually spending. “It’s just one more coin.” You add it up all up at the end and holy crap, I just spent $40. 

Yeah. This business was spawned out of gaming companies who use a lot of these techniques to unlock levels. Every two minutes, beginning, middle, end, cliffhanger. It’s designed to hook you in. It drives high levels of engagement. Early adopters have a willingness to pay a lot more money. [But] look at what happened in streaming to expand and get the last corners of everybody. You’ve had to launch a lot of ad-supported, subsidized, lower-price things because most people can’t afford to pay 40 bucks to watch a soapy microdrama.  

Apps have already started to develop subscription levels, which are equally expensive. $20 a week or $200 a year, which is insane when you think about it. Over time, this business starts to look more like traditional media, but I think the coin piece will always kind of be hanging around. They’ll probably just get cheaper. In China there’s a lot of pressure for this to be far more ad supported. You’ll see the same dynamics here. 
  
If someone produced a vertical independently, what is the price point that you’d be looking at to buy it?  

If it’s great it’s going to get the market rates, which are in the low hundreds of thousands of dollars. If it’s experimental or they’re a new producer, it might be less than that. But this is [only] one opportunity. Normally filmmakers complain a lot about the rev share model. That’s feast-or-famine, [but] even moderately successful microdramas can make a lot of money. There’s a real opportunity for rev share on these.  

It’s like making a Netflix movie. You make it, you sell it, you bake in your profit margin and on to the next one. But if people get really good at it, if they build their own franchises, if they have their own characters, You’re going to see exactly what’s evolved in traditional entertainment economics: They’re going to demand [rev share] and they’re going to get it.  

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