By Chris Connery – Vice President, PC and Large Format Commercial Displays, DisplaySearch
Having been somewhat bitten by zero-cost mass transit projects like Washington Metro’s “The Metro Channel” (TMC) last year, it seems as if the promotional activities for the major out-of-home advertisers has died down in the US market. Announcements from ClearChannel Outdoor in Norway to JCDecaux‘s initiative in Qatar are making news (with many installations in the UK), but the US market seems to be in limbo at the moment.
With advertising dollars being cut in this great recession and with continued efforts focused on determining ROI and metrics standardization for digital signage, it appears as if some of the world’s largest OOH (out-of-home) advertising firms have scaled back their aggressive efforts in the US.
This comes at a time when the FPD industry seems more willing than ever to invest in manufacturing with larger LCD (Sharp is leading the way to Gen 10) and plasma (see Panasonic‘s efforts in expanding production in this space) plants coming on line. These larger plants can make 4-sheet and 6-sheet digital-equivalent FPD displays more easily and more cost effectively than their predecessors. Thus these companies are eager to help push the OOH digital infrastructure further. With FPD TV adoption now skewing towards smaller displays (due to consumer reaction to the economy) there may be more capacity for larger FPDs (both LCD and plasma) ready for full roll-out in OOH markets.
Titan Worldwide is one company that is taking advantage of new opportunities in the US, especially in mass transit, boasting wins for the AC Transit contract in Oakland as well as the San Francisco Municipal Transportation Agency. The infrastructure build-out for these wins (along with on-going projects in Chicago, New York, New Jersey and Boston) seems slow, with supply-chain indications showing no noticeable up-tick in the sales of flat panels for such opportunities. This makes one wonder when these projects will really start generating revenue for the display guys, as opposed to revenue from ad sales.
CBS Outdoor seems to have scaled back initiatives for installing additional digital signage infrastructure in the US, with its current initiatives focused on maintaining its large inventory (after absorbing CBS Outernet in recent months), or on markets outside of the US.
Are these leading indicators of a slow down in building digital-signage infrastructure in the US? Does this leave the door open to other companies becoming “media companies” and thus trying to control the sales of digital inventory themselves in installations that they subsidize?
