Microdramas boom in a shrinking Hollywood as studios chase a TikTok audience

LifestyleMicrodramas boom in a shrinking Hollywood as studios chase a TikTok audienceBy Reuters -Aug 19, 2026Add ARY News on GoogleAAResizeWhen Craig Williams opened his production facility in downtown Los Angeles two years ago, he thought he would rent out the converted furniture warehouse for the occasional music video to sustain his fledgling film business. Williams was blindsided by a phenomenon that quickly overtook ​his production space: microdramas, vertically shot serials delivered in two-minute episodes, played on phones. “It started getting booked — and continued to get booked — with microdramas,” said Williams, 65, a former music producer for Death Row Records. “After a year, I was booked all the time. I said, ‘I’ve got to build another one.’” Williams now ‌operates three production facilities, rebranded as Vertical World Studios, catering to the soapy, fast-paced world of vertical shorts. They’re filled with standing sets – hospital room, police station, courtroom, nightclub – he bought at liquidation prices from major Hollywood studios like Sony Pictures and Paramount. It’s not a surprise. Hollywood is shrinking. Pending mergers threaten to further reduce production of films and shows. Actors fear AI extinction. Streaming companies are losing ground to YouTube. Microdramas may be the only thing that’s growing in Hollywood. The format is expected to generate $1.5 billion in revenue in the U.S. this year and jump to nearly $2 billion next year, according to research firm Omdia. While traditional TV business in the U.S. is massive, at about $125 billion, it’s projected to shrink by as much as $15 billion annually in the coming years because of continued cord-cutting, according to PriceWaterhouseCoopers. It’s also a sign of China’s rising soft power. The format originated there, ​and its rapid ascent has given Chinese-backed apps, such as ReelShort and GoodShort, a Hollywood foothold. Vertical videos altogether, which includes TikTok, have surged, projected...