The market size of the AI short drama industry appears to be growing rapidly, with projections indicating that it will surpass 40 billion yuan domestically and exceed 4 billion US dollars overseas by 2026. However, over 90% of related companies have already gone out of business. Early production companies that relied on platform guarantees and operated with low capacity but high gross margins have faced challenges due to overcapacity, with quotes falling to cost levels. Additionally, as platforms shift to revenue-sharing models, the success rate of producing hit dramas has dropped below 0.5%, making it difficult for most companies to recoup their investments. This has led to phenomena such as equipment rentals being canceled and outstanding debts. The logic of profitability in the industry has changed, with the value of mere AI production capabilities declining. Segments that possess IP, professional content, distribution, and user resources have become more valuable. Some companies are shifting towards high-quality content and long-tail IP development, or expanding into multiple business lines such as advertising, e-commerce materials, and incubating IP accounts. Others are venturing into long-form dramas and theatrical content. Going overseas presents challenges such as localized production, declining revenues, and high customer acquisition costs. However, teams that successfully establish a closed loop of 'content-traffic-payment' can continue to be profitable. With the implementation of the 'Regulations on the Development and Management of Micro Short Dramas,' the era of mass production has come to an end, and future funding will flow towards entities that possess core content and user resources.