From Poe Zhao：China's AI short drama factories now launch 1,300 new titles per day. Production costs fell 90%. Traffic acquisition costs doubled. Revenue per thousand views dropped from Rmb 60 to Rmb 15-30. Most projects now lose money.I analyzed this dynamic in May. China's AI drama market was the largest real-world test of the "more content = more hits" thesis. Breakout rates were already declining as volume climbed. Today's Securities Times industry report confirms the economics have only gotten worse.The most revealing number: only 3-5% of mid-tier AI drama companies are profitable. Below mid-tier, under 2%. The hit rate for AI comic dramas has fallen below 0.1%. One in a thousand. The industry built a machine that makes content nearly free and audiences more expensive.In April, daily production was 470 titles. Three months later: 1,300. Output tripled. Hit rates kept falling. My May analysis covered why the quantity thesis breaks down in AI entertainment, and what that means for every industry banking on the same logic.