CBS Outdoor lands 10-year New York transport contract

NEW YORK - CBS Outdoor, formerly known as Viacom Outdoor, has renewed its contract with the New York City Metropolitan Transportation Authority for 10 years, after seeing off competing bidders.

CBS Outdoor did not disclose the terms of the contract, which covers all display advertising in carriages, stations and platforms in New York City subways and the Staten Island railway.

Wally Kelly, chairman and CEO of CBS Outdoor, said: "This is a hard-fought win against some formidable competition in the bidding process."

The win comes four months after the company lost the 20-year, $1bn New York bus shelter advertising contract to Spanish company Cemusa.

Source: Brand Republic 12th Jan 2006

Viacom Outdoor loses $1bn NYC bus contract to Spanish outsider

LONDON – Cemusa, a Spanish outdoor company that is among the bidders for London's mammoth Tube contract, has flexed its muscles by seeing off four rivals to win a $1bn (£675m) New York City outdoor advertising contract.

In an extra twist, the incumbent on the NYC bus shelter contract is Viacom Outdoor, the current holder of the Tube contract.

Subject to final negotiations, the City of New York has decided to award Cemusa the 20-year contract to sell ad space on bus shelters and newspaper kiosks after a five-way pitch. It has reserved the right to talk to other bidders if negotiations with Cemusa prove unsatisfactory.

Viacom and Clear Channel were eliminated early, making it a three-way fight between Cemusa, Van Wagner and a JCDecaux joint venture with NBC Universal, NBCDecuax.

Cemusa is owned by Spanish construction conglomerate Fomento de Construcciones y Contratas, and has contracts in 110 cities in Europe and North America.

It is among 10 bidders for the estimated £1.3bn Tube contract currently being tendered by Transport for London.

The 10-year contract allows the successful group or groups to sell advertising space on almost 290 London Underground stations, the Docklands Light Railway and Victoria Coach station, comprising 40 six-sheet billboards, many illuminated.

Source: Brand Republic 22nd Sep 2005

PARIS – Outdoor advertising company JCDecaux has said first-half profits rose by 20.2% to €83.3m (£56.1m) on revenues up 5.5% to €833.7m, beating analysts' forecasts.

During the period the company acquired outdoor specialists MediaNation in China and Texon in Hong Kong, markets that are growing faster than its European heartland. France in particular saw softening ad revenues from the first to the second quarter.

First half organic revenue growth was up to 5.1% but over the course of the year Jean-Francois Decaux, chairman of the executive board and co-CEO, expects it to be lower.

"For 2005, we still expect to achieve organic revenue growth of around 4%, with a slower profit growth rate at operating margin and EBIT levels, reflecting the slight first-half revenue decrease in France and the higher revenue proportion from the lower-margin transport division," he said.

Street furniture made the biggest contribution to earnings before interest, tax, depreciation and amortisation, up 2.7% to €191.3m. Billboards was up by 15.1% to €29.8m and transport was up 17.6% to €8m.

The company's net debt increased from €493.2m to €508.1m.

Source: Brand Republic 14 Sep 2005


Going Outside, Beyond the Billboard

By Mike Esterl

Out-of-home advertising, long considered a backwater on Madison Ave., is getting
tougher to ignore as it branches out beyond the old-fashioned billboard.
New technologies are transforming out-of-home ads, a sector which includes
roadside billboards, ads on buses and trains and now even coasters in bars.
As advertisers find it harder to reach consumers through television and radio,
the increasing array of out-of-home ads is looking more attractive.
In a sign of growing interest in the medium, the out-of-home media-buying units of
Mediaedge:cia and MindShare, both part of WPP Group, this week began sharing
Manhattan offices with Poster Publicity, a leading international player in outdoor
advertising. The firms are part of a joint venture called Kinetic formed earlier this
year by WPP and Poster aimed at grabbing a bigger share of the global out-of-home
business. The venture has been up and running in London since June and is billing
itself as the largest out-of-home company in North America.
"The business has changed dramatically," says John Miller, formerly the managing
partner for out-of-home advertising at Mediaedge:cia who is heading the North
American operations of Kinetic. Mr. Miller entered the advertising business as an
outdoor specialist in 1965, when roadside billboards were the primary option offered
advertisers in the out-of-home segment. He counts at least 200 out-of-home formats
in use today.
In May, the advertising agency R/GA helped create an interactive display for Nike on
a 23-story digital billboard in Times Square. Passersby could temporarily control the
billboard and design their own shoes on the huge screen by communicating through
their cellphones. "Now it's very practical to think about outdoor almost exactly as you
think about online," says John Mayo-Smith, vice president of technology at R/GA.
Advertisers are trying all sorts of new venues. Starcom USA, a Publicis Groupe unit,
is in talks with city officials in Chicago about attaching ads to manhole covers to
promote a local museum exhibit that features a German submarine. "The world is
our canvas," says Jack Sullivan, the out-of-home media director at Starcom.
As a result, outdoor advertising is growing faster than most other media segments.
TNS Media Intelligence estimates that outdoor-ad spending made up only 2.3% of
the overall advertising pie in 2004. TNS forecasts that the segment itself will expand
5.5% this year, a faster clip than newspapers, network TV and radio. Industry
executives see out-of-home as one of the hottest advertising media this year,
according to a recent survey by the American Association of Advertising Agencies,
behind only online and the placement of brands within entertainment programming.
New York City's packed streets could see even more advertising before too long.
Officials plan in the next few weeks to award an outdoor-advertising company a 20-
year contract to put ads on the city's newsstands, bus shelters and public toilets.
Some have estimated the deal could generate $1 billion in ad revenue.

Through Kinetic, WPP and Poster hope to get a bigger share of the fast-growing
genre. Kinetic will have 50 employees spread across offices in New York, Miami and
the West Coast by year's end. Eventually Kinetic will have a global staff of more than
300 professionals in 35 countries.
"We'll be able to develop international campaigns with our global clients," says Mr.
Miller, adding that Kinetic expects its billings in New York to be around $350 million
in its first year and $2 billion globally.

The Wall Street Journal, July 21, 2005

WPP tightens grip on out-of-home

WPP has set its sights on the number-one position in the out-of-home market with the merger of its poster buying specialist, Portland Outdoor, with rival Poster Publicity last week.

The much-mooted merger took place in the early hours of last Thursday after receiving unconditional clearance from the Office of Fair Trading and regulators in other key markets.

The new company, Kinetic, is currently ranked number two in the UK behind Posterscope, but is likely to take the MediaCom and Unilever accounts by the end of the year, which will propel it to the top position.

The company also claims it is set to take top position globally and will eventually employ 300 people in 35 countries.

Eric Newnham, former chief executive of Poster Publicity and now global chief executive of Kinetic, said one of the reasons to go into the merger was scale.

"We'd probably got as far as we could have done as a completely independent business against the background of consolidation not only on the media agency side, but also on the media owner side," Newnham said.

"It was a choice of either accepting our limitations or wanting to further our ambitions in the territory by joining with one of the big guys, and they don't get much bigger than WPP."

Kinetic is 50% owned by the former shareholders of Poster Publicity and 50% by WPP, but former Poster Publicity executives dominate the management team.

Mike Segrue, former managing director for Europe, Middle East and Africa at Poster Publicity, takes the role of global chief client officer at Kinetic. Meanwhile, Paul Shearring, formerly UK managing director of Poster Publicity, moves across to take the same role at Kinetic.

The UK line-up includes Nick Parker as buying director, Carolyn Nugent as strategic planning director and James Copley and Catherine Bosworth as client development directors.

Newnham said Kinetic would be responsible for "all of the out of home for WPP" as well as existing clients, including other media agencies and advertisers directly.

He said it was likely that MediaCom, which currently uses Posterscope for its outdoor buying, would eventually move its business to Kinetic, but this would happen "in due course" after the integration of Grey Global and WPP was complete.

Segrue added that the Unilever account, won last year by WPP's MindShare, would also move to Kinetic from its home with poster buying specialist Concord.

Newnham said the name Kinetic did not mention posters or outdoor because of the speed of change in the industry and the fact that the company would have a strong emphasis on digital and experiential marketing.

Source: press release