UK outdoor contractors are considering swapping some of their poster space for a stake in new media companies. Clear Channel International (CCI) is actively pursuing such a strategy.
Poster companies’ interest in striking Internet deals comes three weeks after Channel 5 chief executive David Elstein revealed the station planned to give away airtime in return for a share of Net ventures.
Many new media companies are short of money for advertising campaigns to build mass-market brands, even though their potential value is huge when floated on the stock exchange.
Roger Parry, chief executive of CCI, parent company of UK six-sheet contractor the More Group, says: “It is a very logical business model. It is one we are in active discussions about.” Parry says that CCI is talking to “half a dozen” companies, but refuses to indicate particular operations.
CCI’s US owner, Clear Channel Communications, has invested in several new media companies, and recently struck a deal with Microsoft to put the content of its US radio stations over the Web.
Ron Zeghibe, chief executive of 48-sheet contractor Maiden Outdoor, says: “It is certainly something we would consider,” but stresses that Maiden would not be handing over good quality stock in key selling periods: “It is a way of using up spare capacity,” says Zeghibe.
Bus and London Underground contractor TDI has also investigated the strategy. Its US parent company CBS, which was bought yesterday (Tuesday) by Viacom for $37bn in stock in what is billed the biggest media transaction ever, has pioneered the model with stakes in companies such as Jobs.com Inc.
Jeremy Male, TDI chief exe-cutive, says: “It could happen in the UK. It is a concept which we are familiar with and would not rule out.”
But he points out that because TDI has a fixed inventory – on bus sides and in the Tube – it does not have much spare media.
Jean-Francois Decaux, chief executive of JC Decaux International, which includes the UK’s Mills & Allen, refuses to comment.