Comment
The fall of VFX titans: Technicolor to follow Rhythm & Hues’ tragic path?
MUMBAI: A decade and two years after the dramatic collapse of Oscar-winning studio Rhythm & Hues, history appears to be repeating itself as Technicolor faces imminent shutdown, highlighting the persistent vulnerabilities in the global visual effects industry.
The parallels are striking. Like Rhythm & Hues, which ironically filed for bankruptcy just weeks before winning an Academy Award for Life of Pi in 2013, Technicolor’s potential closure comes despite its stellar creative achievements, including work on blockbusters like The Lion King and The Jungle Book.
Both cases expose a fundamental flaw in the VFX industry’s business model: studios maintaining expensive executive operations in Western markets while relying on lower-paid artists in outsourcing hubs like India. This structure, which prioritised top-heavy management over sustainable artist compensation, has proven unsustainable twice over.
Technicolor’s recent mismanagement compounds these structural issues. The company’s third-quarter 2023 results tell a devastating story: revenue declines of over 45 per cent across its creative divisions, masked by corporate buzzwords about “transformation journeys.”
The appointment of an interim chief executive from the car rental industry, rather than someone with media expertise, echoes the kind of decision-making that plagued Rhythm & Hues in its final days.
“The industry hasn’t learned from its past,” notes one veteran VFX artist who witnessed both collapses. “When Rhythm & Hues fell, we said ‘never again,’ but here we are, watching another giant stumble under the weight of mismanagement and unsustainable business practices.”
Technicolor, the Paris-headquartered company has begun issuing Worker Adjustment and Retraining Notification (WARN) notices to its US employees, alerting them of potential mass layoffs and closure. The shutdown would affect thousands of visual effects artists across the company’s global operations in the US, UK, Canada, and India..
“Technicolor has been facing severe financial challenges,” states the WARN notice obtained by us at indiantelevision.com “Despite exhaustive efforts — including restructuring initiatives, discussions with potential investors, and exploring acquisition opportunities — we have been unable to secure a viable path forward.”
The issuance of WARN notices to US employees, signalling potential closure by 24 February, eerily mirrors the sudden unravelling of Rhythm & Hues. Then, as now, thousands of artists across global studios face uncertain futures, while ongoing projects hang in limbo.
This second major collapse in a decade raises serious questions about the sustainability of the VFX industry’s current model. Despite the increasing demand for visual effects in film and television, the businesses creating these spectacles continue to struggle with profitability, suggesting that fundamental reform may be necessary for the industry’s survival.
The content creation industry needs to understand, creating realistic visuals costs, and the cheques – probably much fatter than given out now – need to be kept aside for those bringing realism to green-screen shot sequences. These days, VFX is the real hero of most action filled films; without it most films would fall flat and seem uninteresting. While onscreen talent walks away with tens of hundreds of millions of the box office collections, the VFX folks who labour on a film for a couple of years — after putting in millions of dollars for software licences and hardware – end up with as much or even less than what the onscreen talent does in terms of profits.
What makes Technicolor’s potential demise particularly troubling is that it comes despite the lessons of Rhythm & Hues’ collapse. The company’s aggressive merger strategy and failure to maintain operational efficiency – evidenced by missed EBITDA targets and withdrawn financial outlooks – suggest that even recent history’s harsh lessons went unheeded.
As employees in seven US states prepare for possible closure, submitting direct deposit details for final paycheques, the industry faces a moment of reckoning. The question remains: how many giants must fall before the visual effects industry finds a sustainable path forward?
The development also raises concerns about the global AVGC-XR (Animation, Visual Effects, Gaming and Extended Reality) industry, particularly in markets like India where both animation and visual effects sectors are reportedly struggling despite official optimism.
Industry observers await Monday’s developments as Technicolor continues last-minute efforts to keep its doors open, while the future of thousands of visual effects artists hangs in the balance.
MUMBAI: 2025 will be remembered as the year India’s OTT industry stopped chasing scale for its own sake and began reckoning with how audiences actually consume content. Completion rates fell, patience wore thin and the limits of long-form excess became impossible to ignore. In this guest column, Pratap Jain, founder and CEO of ChanaJor, traces how micro-drama moved from the fringes to the centre of viewing behaviour, why short-form fiction emerged as a retention engine rather than a trend, and how platforms that respected time, habit and emotional payoff were the ones that truly grew up in 2025.
If there is one thing 2025 will be remembered for in the Indian OTT industry, it’s this: the industry finally stopped pretending.
Stopped pretending that bigger automatically meant better.
Stopped pretending that viewers had endless time.
Stopped pretending that scale without retention was success.
What began as a quiet reset in 2023 and a cautious correction in 2024 turned into a very visible shift in 2025. Business models matured. Content strategies tightened. And most importantly, platforms started aligning themselves with how Indians actually watch content, not how the industry wished they would.
At the centre of this shift was micro-drama—not as a trend, but as a behavioural inevitability.
When OTT finally understood the time problem
For years, long episodes were treated as a marker of seriousness. A 45–60 minute runtime was almost a badge of credibility. Shorter formats were pushed to the margins, labelled as “snack content” or “mobile-only.”
That belief quietly collapsed in 2025.
What platform data showed very clearly was not a drop in interest—but a drop in patience. Viewers weren’t rejecting stories. They were rejecting commitment.
Across platforms, the same patterns appeared:
* First-episode drop-offs on long-form shows kept increasing
* Completion rates continued to slide
* Viewers were sampling more titles but finishing fewer
At the same time, shows with episodes in the six to 10 minute range started showing the opposite behaviour: higher completion, higher repeat viewing, and stronger daily habit formation.
Micro-drama didn’t win because it was short. It won because it respected time.
Micro-Drama didn’t arrive loudly. It took over quietly.
There was no single moment when micro-drama “launched” in India. It crept in through dashboards and retention charts.
By mid-2025, it was clear that viewers were happy watching four, five, sometimes six short episodes in one sitting—even when they wouldn’t finish a single long episode. Romance, relationship drama, slice-of-life conflict, and grounded comedy worked especially well.
This wasn’t disposable content. It was compressed storytelling.
In shorter formats, there was no room for indulgence. Every episode had to move the story forward. Weak writing was punished faster. Strong writing was rewarded immediately.
Micro-drama raised the bar instead of lowering it.
Where ChanaJor naturally fit into this shift
ChanaJor didn’t pivot to micro-drama in 2025 because the market demanded it. In many ways, the platform was already built around the same viewing behaviour.
From the beginning, ChanaJor focused on short-to-mid-length fictional stories that felt close to everyday Indian life—hostels, rented flats, office romances, small-town relationships, young people figuring things out. Stories that didn’t need heavy context or cinematic scale to connect.
What worked in ChanaJor’s favour in 2025 was clarity:
* A clearly defined audience
* Tight episode lengths
* Storytelling that prioritised emotion and pace over spectacle
While several platforms rushed to copy global micro-drama formats, ChanaJor stayed rooted in familiar Indian settings and conflicts. That familiarity mattered. Viewers didn’t have to “enter” the world of the show—it already felt like theirs.
Why audiences started responding differently
One of the biggest misconceptions going into 2025 was that audiences wanted shorter content because their attention spans had reduced. That wasn’t entirely true.
What viewers actually wanted was meaningful payoff per minute.
On platforms like ChanaJor, episodes didn’t waste time setting the mood for ten minutes. Conflicts arrived early. Characters were recognisable within moments. Emotional hooks landed fast.
A typical consumption pattern looked like real life:
* One episode during a break
* Two more before sleeping
* A few the next day
This is how viewing habits are built—not through marketing spends, but through comfort and consistency.
Viewers came back not because every show was a blockbuster, but because they knew what kind of experience to expect.
2025 was also the year OTT faced business reality
The other big change in 2025 was on the business side. Subscriber growth slowed. Discounts stopped hiding churn. Customer acquisition costs rose.
Platforms were forced to ask harder questions:
* Are viewers finishing what they start?
* Are they returning without reminders?
* Is this content worth what we’re spending on it?
This is where micro-drama began outperforming expectations. A well-written short series could deliver sustained engagement without massive budgets. It didn’t peak for one weekend and disappear—it stayed alive through repeat viewing.
Platforms like ChanaJor benefited because they weren’t chasing inflated launch numbers. The focus was on consistency and retention, not noise.
Failures Became Visible Faster
2025 also exposed weaknesses brutally.
Several platforms assumed micro-drama was a shortcut—short episodes, quick shoots, instant traction. What they discovered was that bad writing fails faster in short formats than in long ones.
Viewers dropped off within minutes. Episodes were abandoned mid-way. Weak stories had nowhere to hide.
Micro-drama didn’t forgive laziness. It amplified it.
The platforms that survived were the ones that treated short storytelling with the same seriousness as long-form—sometimes more.
OTT Stopped Chasing Prestige and Started Chasing Habit
Perhaps the most important shift in 2025 wasn’t technical or creative—it was psychological.
OTT stopped trying to look like cinema. It stopped chasing validation through scale and awards alone. It began behaving like what it actually is in people’s lives: a daily companion.
Platforms like ChanaJor found their space here because that mindset was already baked in. The goal wasn’t to dominate a weekend launch. It was to quietly become part of someone’s everyday viewing routine.
That shift changed everything—from release strategies to how success was measured.
What 2025 Ultimately Taught the Industry
By the end of the year, three truths were impossible to ignore:
* Time is the most valuable thing a viewer gives you
* Retention matters more than reach
* Format must follow behaviour, not ego
Micro-drama didn’t take over because it was fashionable. It took over because it fit real life.
Looking Ahead
Micro-drama is not replacing long-form storytelling. It is redefining the baseline of engagement.
Longer shows will survive—but only when they earn their length. Short-form fiction will continue to evolve, becoming sharper, more emotionally confident, and better written.
Platforms like ChanaJor have shown that it’s possible to grow without shouting—by understanding the audience, respecting their time, and telling stories that feel real.
2025 wasn’t the year OTT became smaller. It was the year it became smarter.
Note: The views expressed in this article are solely the author’s and do not necessarily reflect our own.
