ID Comms

Can Decaux and Primesight buck the curse of Network Rail?

Executives at JC Decaux and Primesight will be looking nervously at their corporate bank balances today as they digest the news that they are to share the £260 million Network Rail outdoor advertising contract.

Normally, this would be a cause of great rejoicing but the whole outdoor industry knows that overbidding for the Network Rail business destroyed both Maiden and its successor Titan as they tried to sell enough ads to pay off the gigantic fees they had guaranteed the mighty rail landowner.

Indeed the traditional outdoor contractor business model has been under some strain in the last decade, after property owners woke up to the value of their locations and forced the poster companies to bid ever higher for the right to put ads on their sites.

And it was typical of its wonderful sense of timing that the Office of Fair Trading, fresh from the debacle of its failed price-fixing prosecution of British Airways and Virgin, should on the same day announce a review of the £800 million outdoor industry, on the grounds that there might be too much consolidation in the industry.

Most people think that on the contractor side, at any rate, the balance is just about right. Contractors have been huddling together for warmth in the last few years and now there are four big players, Decaux with 29% of the market, CBS with 23%, Clear Channel with 22%, and Primesight with 12%. It’s no accident that three of these firms are big multi-national entities: deep pockets are de rigueur in outdoor these days.

So the main point of interest in outdoor over the next year will be not the OFT investigation but whether Decaux and Primesight can buck the curse of Network Rail.

You May Also Like

Clear Channel JC Decaux Network Rail OFT Primesight

About David O'Reilly

David is a former deputy editor of Campaign and writer for a number of leading titles including Management Today and the Sunday Times. He is a partner in The Editorial Partnership.
Share
Tweet
+1
Share
© Copyright 2013 More About Advertising, All Rights Reserved. With help of WPWarfare.com. | Cookies explained.