![[The Korean Desk]Short-Form and AI Fill the Space the Disc Left Behind](https://cdn.media.bluedot.so/bluedot.kentertechhub/2026/07/o47uxw_202607022239.jpeg)
Sony's 2028 disc shutdown, Shortical's $100 million, and Deloitte's $7.8 billion forecast sketch where content is headed
Three stories set the industry buzzing this week. Sony PlayStation announced it will end physical disc production for new games after January 2028. Shortical, an Israeli micro drama app, raised $100 million behind its push into AI series. And Deloitte forecast that micro drama app revenue will more than double this year to $7.8 billion.
Jung Han
In the very week the disc era PlayStation opened in 1994 was handed its closing date, capital and research each wrote down the same answer about where entertainment's weight is shifting: mobile short-form and AI production.
With digital downloads at 78% of PlayStation full-game purchases, and AI cutting hourly production costs of hundreds of thousands of dollars to a fraction, the industry's money and distribution are moving toward formats that are short, vertical, and instantly consumable.
1. 1994→2028 — the disc era gets its closing date
PlayStation 5. From January 2028, new games will be sold in digital formats only.
Sony Interactive Entertainment said in an official blog post on July 1 that new games for PlayStation consoles will be sold only in digital formats after January 2028, through the PlayStation Store and at retailers. Games released on disc before then are unaffected. Sid Shuman, SIE's senior director of content communications, grounded the decision in the long migration of consumer preference — across gaming and entertainment at large — from disc to digital.
“This is a natural direction for Sony Interactive Entertainment to adapt to consumer trends as the general preference for digital media significantly outpaces physical discs.” — Sid Shuman, SIE
In the end, no company beats its market. In the fiscal year ended March 2026, digital downloads accounted for 78% of full-game purchases on PlayStation. What was a minority choice a decade ago became the standard, and the disc slipped to one purchase in five. Days earlier, Rockstar Games had drawn fan backlash by revealing that GTA VI's “physical” edition would ship as a download code in a box rather than a disc — and Sony's announcement confirmed that this was not one publisher's choice but the platform's timetable. Piers Harding-Rolls, senior games analyst at Ampere Analysis, reads the move as signaling that the next-generation PS6 will not arrive before 2028 and that its base model will ship without a disc drive. Retail built on trade-ins and resale — the GameStop model — now has to redraw its foundations.
2. $100 million drawn in by AI actors
Shortical's homepage. The “License Your Face” menu hints at a new contract form for the AI actor era.
Shortical's raise, exclusively reported by Business Insider, is being read as resetting the micro drama industry's records in both size and structure.
What stands out is the structure. The $100 million from PvX Partners, a financial services firm, is not equity but user-acquisition financing — a debt instrument common in mobile gaming.
PvX recoups a share of the revenue new users generate, and the founders keep their equity. Against Holywater's $22 million and GammaTime's $14 million, the figure sits in a different weight class. Hernan Lopez, founder of streaming research firm Owl & Co., read the very arrival of this type of capital as a signal that the unit economics have been proven.
“Bound by Fire,” Shortical's first AI series. Every on-screen performer was generated by AI.
Shortical has released an AI-acted fantasy series, “Bound by Fire,” and says audience response matched its live-action titles. The company plans to produce 20 hours of AI shows per month alongside five hours of live-action programming, in a market where an hour of live-action series runs $100,000 to $300,000. In an interview, CEO Guy Shimoni made a point of the human side as well: 15 full-time screenwriters on staff, and collaborations with talent such as Ofir Lobel, a director of Netflix series. The message — what AI displaces is the cost of the set, not the people who design the story.
“I believe AI has the potential to 10x what we do with live productions, with a similar or less budget. Long term, 10x, if not 100x.” — Guy Shimoni, CEO, Shortical
3. Deloitte's arithmetic — the industry leans harder into short-form
Deloitte Insights, Figure 1: 662 million micro-drama users in China and 150 million MAU across Asia's top five apps (source: Omdia, March 2025).
Deloitte's TMT Predictions 2026 puts numbers to the shift. In-app revenue for micro-series (micro drama) apps grows from $3.8 billion in 2025 to $7.8 billion in 2026, while the US share falls from half (50%) to 40% — meaning markets outside the US are getting faster at converting views and downloads into cash. Global revenue from micro drama apps in fact jumped nearly fourfold in a year, from $178 million in Q1 2024 to roughly $700 million in Q1 2025. (deloitte)
User-acquisition financing vs. equity investment (compiled from Business Insider reporting)
Asia laid the foundation. In China, roughly 662 million people watched micro-dramas as of 2024, and iQiyi carries more than 15,000 free and paid titles, has grown its watch time considerably over the past year, and has added e-commerce around the micro-drama ecosystem. In India, Zee Entertainment and Kuku FM have opened dedicated micro-drama verticals, with platforms reporting doubled daily watch times after introducing short-form pilots. They are experimenting with per-episode micro-payments, flexible subscriptions, and hybrid models that mix subscription fees with advertising income. The shared template: the first few episodes are free, and the paywall arrives just as the story takes hold.
In the US, apps like DramaBox, ReelShort, and GoodShort now sit regularly among the top 25 app store downloads, and the US has become the top-grossing market for short-drama apps. Crossovers onto social video platforms pushed the growth, and social platforms themselves are drawing more engagement from micro-series content.
The demand skews young. In Deloitte's survey of US consumers, as of March 2025 about 30% of Gen Z and millennials knew of micro-series; nearly half of them were watching more than a year earlier, and a similar share wanted more micro-series on the streaming services they already subscribe to. Deloitte reads this as a competitive path open to streamers.
Deloitte also points out that algorithmic feeds and interest graphs were never designed to carry serialized narrative. On a capricious social feed, “following” a series and keeping up with new episodes is hard work — a gap that could push serial-minded viewers and creators toward dedicated micro drama apps or streaming services.
If micro-series keep climbing, though, Deloitte sees social platforms retooling their trending algorithms with “series-aware” logic or “continue watching” rails. For users tired enough of the infinite feed that Oxford named “brain rot” its 2024 word of the year, serial short-form — the next episode arriving on schedule — looks like the habits of linear TV rebuilt for the phone. Deloitte poses the question in the same terms: could a short-form throwback to linear TV be the solution?
4. Physical media returns — as a luxury good
Share of music buyers citing “nostalgia” by generation. 55% of Gen X cassette buyers named it (source: Luminate U.S. Music 360, 2025).
Physical media is not simply vanishing. Vinyl records, CDs, and cassette tapes have all revived, and buyers in Luminate's research name nostalgia as the reason — most of all Gen X, the generation that watched these formats arrive firsthand.
Gaming will keep its limited packages and collector's editions too. The nature of this revival deserves a distinction, though. With a vinyl record, the object itself is the product — the sleeve on the wall, the record on the turntable, the act of owning, all of it paid for. A game disc was different. It was a carrier of data, and once a faster carrier appeared, its reason to exist went with it. The return of physical media is not the revival of a mass distribution channel but the formation of a premium, collector-driven market — a luxury market. The carrier exits; the object survives as a luxury good.
5. What remains — IP, development, and reach
Lay the four scenes over one another and you can read where value is going. Value in the delivery layer — manufacturing, logistics, retail — is being wound down, and AI is pulling down costs in the execution layer — shoots and on-screen talent. Strip those away and what remains is the development and IP that design the story, and the distribution muscle to reach viewers and hold them.
Shortical led with AI series and still made a point of its 15 staff writers.
Deloitte named the rise of creator studios and social platforms' support for serial content as the things to watch. What AI displaces is the cost of the set, not the people who decide what to tell and how to tell it. As carriers disappear and production costs flatten, the places where value gets priced narrow to development, IP, and reach.
Korea's hand holds exactly those cards: story IP whose consumption the whole world has validated, the format craft to carry a serial across episodes, and the global reach that “Squid Game” and “KPop Demon Hunters” demonstrated. Until now, though, those assets have ridden on a high-cost production structure running to hundreds of thousands of dollars per episode.
The task of the next two to three years is moving them onto the new terrain — loading proven IP and format craft onto an AI-lowered cost base, and placing them in short, vertical distribution windows like micro dramas and FAST. What this week's three stories say is simple. The power to make stories remains. Where and how you place it decides the next round.
Sources
Variety, “PlayStation Ending Games on Physical Discs in 2028” (July 1, 2026): https://variety.com/2026/gaming/news/playstation-ending-games-physical-discs-2028-1236799978/
Business Insider, “AI actors helped this micro drama app raise $100 million in financing” (Lucia Moses, July 1, 2026): https://www.businessinsider.com/ai-series-help-shortical-raise-100m-funding-from-pvx-partners-2026-7
Deloitte Insights, “TMT Predictions 2026: Short-form video series”: https://www.deloitte.com/us/en/insights/industry/technology/technology-media-and-telecom-predictions/2026/short-form-video-series.html
The Korean Desk is a news program dedicated to Korean culture, entertainment, and technology. Produced by K-EnterTech Hub in partnership with Sinclair, Inc., it brings Korea's content and technology stories to audiences across the United States.