At first glance, Turner’s decision to monetize its Adult Swim property in Australia as an ad-supported online video service – officially announced at the end of October – seems like a no-brainer.

After all, the broad reach offered by the internet is well suited to tightly targeted channel brands that often find traditional distribution hard to come by.

Adult Swim, dealing in a distinct kind of humor aimed at male 20-somethings, and almost invisible in Asia-Pacific, would be a prime example.

Nonetheless, the launch followed 18 months of working out how best to import the more unconventional content from Turner’s library into Asia.

Adult Swim’s move into Australia marks the start of a broader rollout for the brand.

“We first identified the market, then looked at the model,” explained Jeremy Carr, Turner’s regional VP of digital entertainment syndication and distribution, speaking in Hong Kong at the recent annual convention for regional pay-TV body, Casbaa.

“Originally, I was looking at a model that was much more paid-to-consumer, but ended up going to advertising to build scale around the audience, and then look to a premium model in the future,” Carr added.

“It’s that deep dive, in understanding what you have to do to get your content monetized in this online space.”

Content returns

Turner already syndicates Adult Swim content in Australia, to pay-TV platform Foxtel for its Comedy Channel as well as to free-to-air broadcasters. Content included in the Foxtel deal will not be carried on the new site.

Similar incarnations of Adult Swim, as a pure ad-based play, are unlikely for the foreseeable future in Asia’s growth economies, however.

The dominance of YouTube in these markets, operating at scale with low CPMs, makes it difficult to sell video at premium rates.
As a result, advertisers tend to regard online video as a giveaway rather than a premium offering.

“That’s why we looked at Australia as the first primary market for Adult Swim,” Carr explained.

“In that market, there’s a demand for video, there are high CPMs between 45-55 dollars for video.

“Yet you get sub-10 dollars in the region, and it’s difficult to capture that audience because it’s so fragmented with many different players and big portals.”

Hybrid models

That makes a consumer fee-based approach for Adult Swim more likely in Asia.

Nonetheless, Carr stressed the need to deploy a variety of potentially hybrid models, rather than relying on a single blueprint.

General discussion on the panel, called Monetizing OTT, underscored the truism that the consumer mantra of any time, any place, any device is easy enough to understand for online video – but working out the economics to make that happen for premium content is another matter.

“Because it’s the internet, anyone can come in – you’re going to have so many more competitors,” highlighted another panelist Buddy Marini, MD of studio-backed subscription VOD service, Hulu Japan.

“You’re going to have to compete on low margins, you’re going to have to compete on innovation, you’re going to have to compete with dual revenue streams, and you’re going to have to really service your customer – not just the end user but also the content rights-holder and your pay-TV customer,” Marini added.

“Only the best at all four of those will survive.”

The Monetizing OTT panel, also including executives from Fox International Channels and YouTube, can be viewed in full here.