As London prepares for an estimated 5m visitors to next year’s Olympics, media owners and advertisers alike are scrabbling frantically for the best places to reach them. The frenzy has led agency Carat to predict that the Olympics will help to grow British outdoor spend by five percent next year, a welcome boost after a 2011 that is likely to prove flattish.

But one media owner is playing an especially aggressive game: CBS Outdoor has threatened to terminate its contract with Transport for London (TfL), operator of the London Underground, before the Olympics start.

The contract, which covers tens of thousands of poster sites in stations and trains as well as a pioneering network of digital displays, was awarded to CBS Outdoor in 2006 for nine years.

But the media firm, charging that it has been thwarted in screen rollouts by TfL’s construction work at stations, has said it plans to walk out of the contract in March 2012, and is suing TfL’s London Underground subsidiary for tens of millions of pounds in damages.

Other issues disputed between the two include the precise split of advertising revenues and the ownership of the screen network infrastructure that has already been installed, about 70 percent of that planned. London Underground, for its part, says it has met all its obligations and that any delays to the rollout are “entirely the responsibility” of CBS Outdoor.

Yet the British media commentator Ivan Clark has suggested that CBS Outdoor is not really planning to abandon the Tube just months before the Olympic fillip kicks in.

“This should surely signal the end of so-called volume guarantees, where a media-sales company guarantees a fixed sum to the owner of the advertising rights in order to win a contract,” he blogged.

“The winner knows, particularly in consolidated markets like outdoor, they will always be able to renegotiate terms. Otherwise they could count their losses, liquidate their business and walk away, often owing large sums of ‘guaranteed’ monies and leaving the rights-holder in a weak negotiating position to secure another sales ‘partner’.”

JCDecaux: on the Games’ doorstep

Other London media owners are sticking to the business of selling advertising inventory to brands. Clear Channel’s rival JCDecaux, for example, has signed up Japanese fashion retailer Uniqlo for its new Stratford Corridor Gateway Domination package (pictured), which covers the two passenger tunnels that all visitors arriving by Tube or train at the Olympics site in east London must use.

Although Uniqlo’s five-week campaign – booked by Kinetic, planned by Adam & Eve London’s Eden, and using creative from Dentsu London – will end long before the Games begin, it is still expected to reach around 100,000 consumers each week, promoting the retailer’s store at the recently-opened Westfield Stratford City mall. Media in the domination package include 11 D6 screens as well as large wall-wraps.

Said Spencer Berwin, managing director for sales at JCDecaux: “This is a first look at one of our key Olympic assets. The Stratford Corridors provide a high-impact, immersive experience for consumers at this new retail hub.”

VeriFone: in the back of the cab

London taxi passengers as well as train travellers are also being targeted in the run-up to the Olympics. VeriFone, the U.S.-headquartered firm which recently launched an in-cab video network called VNET in London, has now acquired Taxi Media, a major player in non-digital advertising on the black cabs.

The takeover will allow VeriFone to offer clients campaigns that combine digital screens with conventional taxi wraps. Taxi Media, whose CEO and staff are remaining with the operation, had relationships with around a third of the city’s approximately 20,000 cab drivers which it claimed gave it access to 70 percent of the London taxi-advertising market – not all London cabs carry ads.

Said Mark Roberts, VP and general manager of VeriFone Taxi and Media Solutions: “Taxi Media has been at the forefront of the taxi-advertising industry since the medium was first established a decade-and-a-half ago. No-one understands the needs of taxi advertisers or drivers better. VeriFone wants to retain the experience, skills and approach which has made Taxi Media a success. Combining the strengths of both businesses creates a dynamic new media organisation that will help take London’s taxis into the digital age.”

Let’s hope that the London Tube isn’t departing that era just as the taxis arrive.

www.adamandevelondon.com
www.carat.co.uk
www.cbsoutdoor.co.uk
dentsulondon.com
ivanclark.mediaweek.co.uk
www.jcdecaux.co.uk
www.kineticww.com
www.verifonemedia.co.uk

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