Telcos and advertising giants forge alliances for $500m ad contract Media Man Int

Telcos and advertising giants forge alliances for $500m ad contract -15th July 2018

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By Jennifer Duke

Telecommunications companies and advertising giants are forming consortiums in a bid to secure Australia’s biggest outdoor advertising contract, after the City of Sydney tweaked its expressions of interest campaign.

Fairfax Media understands a request from council for companies to resubmit bids included a requirement for applicants to cover off on every aspect of free public Wifi, furniture and advertising panels across the city within their submission. As it's unlikely any Australian company can deliver all of these features alone, alliances have been made to be made to win the contract.

Sources say Here There & Everywhere’s street furniture arm Adshel has aligned with Singtel Optus and ENE-HUB since the first round of submissions, while JCDecaux is coordinating with Telstra, and APN Outdoor Group is in discussions with TPG Telecom.

JCDecaux and Telstra have already been in partnership delivering digital phone booths, while Optus launched free public Wifi in the Royal Botanic Gardens in February with ENE-HUB.

The coveted City of Sydney street furniture contract is for 10 years, with a performance-based option for an additional five years, and is said to be worth in excess of $500 million making it the biggest outdoor advertising contract in history. Council documents say consortiums may be required to "assume a specific legal form if awarded the contract".

It is unclear whether OohMedia has obtained a partner for the second expressions of interest submissions, and while Vodafone has been approached by a major outdoor advertising company it’s understood the telco has not entered into any formal arrangements.

This comes within weeks of OohMedia making a successful $570 million bid to buy Adshel in late-June, while JCDecaux is in the process of acquiring APN for $1.12 billion bid. These deals are awaiting Australian Competition and Consumer Commission approval.

Expressions of interest are due to council on 31 July, however the ACCC will not make a decision on either advertising company’s acquisition until 30 August. This means the companies are expected to continue with their rival submissions.

There’s speculation other major councils across the country will be looking to roll out similar plans to what is in the City of Sydney tender, making winning the tender even more critical.

JCDecaux, as the current long-term contract holder, is going to continue providing services until 2020. In addition to advertising panels, the contract covers about 400 bus shelters, 40 kiosks and 160 communications panels, some bins and benches.

Payphones across the city, which are attached to JCDecaux’s advertising assets, will be removed under the changes and Telstra will have to make its own arrangements to fulfil its contract to provide payphones. In most cases, newly installed communications panels will be installed with smart city features like free internet, phones charging stations, advertising, WiFi and transport information.

While telcos will retain ownership of data gathered from people using the free Wifi, council will be given “access rights to the anonymised data”.

(The Sydney Morning Herald)