China’s television drama industry is seeing its most significant regulatory relaxation in nearly 20 years, according to a report in financial media Caixin. The National Radio and Television Administration (NRTA) convened a meeting of provincial broadcasting departments, platforms and production companies on Aug. 18 to announce adjustments to industry rules. The most eye-catching change was the easing of restrictions on ancient costume dramas, widely interpreted as a relaxation of the long-standing ban on historical and period dramas.

Other key adjustments include removing the 40-episode cap on single drama series and the one-year gap requirement for seasonal dramas; restarting trials of in-drama advertising, which had been banned for over a decade; shortening the review period for finished works from 50 days to 30 days; and delegating some review powers to local television stations. The new policy also encourages broadcasting for individual dramas on multiple outlets, promotes ultra-high-definition production and supports dedicated theaters for micro-short dramas, to enhance program diversity.

Market reaction to the changes was broadly positive, with shares of film and TV companies surging on Aug. 18. Baina Qiancheng (300291.SZ), Huazhi Digital Media (300426.SZ) and Huace Film & TV (300133.SZ) all rose by their daily limit of about 10%, as investors bet on greater content supply and profitability.

The number of TV dramas produced in China has declined steadily over the last five years, as China’s 2024 box office fell 23% year-on-year after a brief recovery with the end of the pandemic. Meanwhile, short dramas and cultural-tourism content have boomed. ByteDance’s Hongguo short drama app has rapidly expanded its user base with its short-form, emotionally engaging content. By contrast, Youku, iQiyi (IQ.US), Tencent Video and Mango TV—still mainly focused on long-form dramas — have cut back on mid- and lower-tier productions to stem losses, focusing only on their top-tier series.

Industry insiders generally believe the new relaxation will result in the release of many stockpiled costume dramas and benefit companies with capital and strong creative capabilities. However, content “red lines” remain, with adaptations of boys love (BL) novels still unlikely to be cleared by censors. Policy experts stress that the biggest winners will be future “satellite TV prime-time dramas,” as removing the episode cap will enable the development of costly long dramas. A loosening of restrictions on streaming platforms could further open space for mid-size innovative productions.

By Lee Shih Ta

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