A state-sector monopoly on advertising in China's railway stations has been smashed with the sale of exclusive advertising space rights at four major stations to a German media firm.
Business Media China AG (BMC) has secured a six-year contract on the rights to advertising space at the capital's two main railway stations -- Beijing Railway Station and Beijing West Railway Station -- as well as the pivotal stations in neighboring Tianjin Municipality and Shijiazhuang, capital of Hebei Province.
The contract also has advanced licensing rights beyond 2012 and includes the development of a plan for the use of advertising space in 20 other railway stations controlled by the Beijing Railway Bureau.
"This has broken the state sector's long-term monopoly in the railway advertisement sector," said Zhang Jie, an advertising executive with the China Railway Century Media Co. Ltd, a company fully-owned by the Beijing Railway Bureau. The four stations had at least 20,000 square meters of advertisement space and LCD screens that were viewed 320 million times a year, he said.
The four stations posted an aggregate advertisement income between 40 million and 50 million yuan (five million to 6.25 million U.S. dollars) a year, which BMC planned to increase to 150 million to 200 million yuan (18.75 million to 25 million U.S. dollars), said company executive Liu Yining.
As the 2008 Beijing Olympics drew near, the Beijing Railway Bureau also hoped to revamp advertisements at railway stations and polish these "windows on the cities", said Zhang Jie.
BMC says on its website that "rail stations in China occupy very central, highly populated zones providing ideal sites for advertising opportunities". Neither BMC nor the Beijing Railway Bureau revealed how much BMC would pay for the rights, but an anonymous source told the Beijing News that BMC would pay the railway authorities 55 million yuan (6.875 million U.S. dollars) for the first year of operation.
The Beijing Railway Bureau reserves the right to provide advertisement solutions at another 310 stations in north China. The railway is for many Chinese a primary means of transportation. The Ministry of Railways said the Chinese made 1.154 billion trips by rail last year, up 3.3 percent year-on-year and hitting a ten-year high.
BMC is based in Stuttgart and listed on the Frankfurt Stock Exchange. It already provides advertising services to Beijing's Capital International Airport and the Hongqiao International Airport in Shanghai.
Source:佚名