MediaWorks currently has the contract to run bus advertising for AT.
MediaWorks currently has the contract to run bus advertising for AT.
The biggest media procurement in New Zealand history has been cancelled suddenly, with Auckland Transport pulling the pin today on an 18-month project to find a new roster of partners for its outdoor advertising assets.
With three weeks left to run on current contracts, the publicly owned organisation has cannedplans - and a vigorous tender process - to agree new arrangements for outdoor advertising companies to look after AT’s billboards, buses, trains and ferries, bus shelters, train stations/transport hubs and promotional activations from January 1.
In all there were five contracts on offer, estimated to be valued at several hundred million dollars over the next 10 years.
AT itself has described the contracts as “the largest media procurement in New Zealand history”.
It now says an entirely new RFP (request for proposals) - with new and updated criteria - will be issued some time in the new year.
AT declined to say today why the tender process was canned, with essentially a year-and-a-half of work going by the wayside. Media manager Blake Crayton-Brown said this was “confidential”.
However, it is understood AT has been telling industry participants the cancellation is based on market feedback, concerns about any transition and consistency of service delivery in the timeframe left available.
oOH!media has the current contract for AT bus shelters. Photo / oOH!media
Given AT was still confident as late as November 21 new contracts were on schedule, it appears the Government’s recent announcement to legislate to bring AT’s planning, strategy and policy functions back under the control of Auckland Council might also be a contributing factor.
For more than 18 months, all the big outdoor advertising players have been in the mix for the new contracts including oOh!media, which has the current contract for bus shelters, and MediaWorks, which has the contract for bus exteriors and some billboards, as well as the likes of Lumo, JCDecaux and Go Media.
Many of the outdoor companies have invested heavily in the tender process during that time, amid a backdrop of much uncertainty, especially for the incumbents and their staff.
The outcome of AT’s decisions would have dictated the immediate futures of many of the companies. Successful bidders would likely have needed to gear up; others may have faced cost-cutting.
In that respect, the deferred tender process is good news for oOh!media and MediaWorks in that there is some short-term certainty, but there will be frustration and likely anger from much of the rest of the industry.
As far back as June last year, insiders described the contracts as “transformational” and said the procurement process had sent the outdoor media companies into “a frenzy”.
Another source called it “the biggest pitch” in media. A third said everyone had something to gain, and possibly something to lose, depending on how AT ultimately landed on the future contracts.
The tender process has been the subject of many rumours and speculation in the outdoor advertising industry about who was in and out.
As well as the Government’s moves over how AT operates in future, there is also speculation that AT might still have been doing full due diligence on possible successful bidders and simply ran out of time.
In a response to questions today, AT head of partnerships and experience Simon Soulsby said: “Auckland Transport is extending the out-of-home media services procurement process and will re-issue the RFP with modified evaluation criteria and bid structure.
“We acknowledge all the hard work from the participants to the RFP and the effort they have put into their proposals to date.
“We recognise this will be frustrating for our participants and we’ve assured them we are committed to providing clarity on next steps shortly.”
In October, Soulsby said: “Our focus is on the RFP outcomes and we’re confident that we’re still very much on track for the new contracts to roll out in January. Whilst we understand that an announcement is important for all involved [including the ratepayers], we need to maintain a laser focus on the task in hand. If an announcement ends up being slightly later than we had first anticipated, we don’t see that impacting our January launch date.”
On November 21, Soulsby said: “Our focus continues to be getting the best result for Auckland ratepayers. Given the scale of the negotiations this has taken longer than expected. We anticipate that the new contracts will still roll out in January.”
Soulsby today said the process remained confidential.
“Auckland Transport remains committed to providing value for Auckland ratepayers and maximising the opportunity that our out-of-home media portfolio brings. Advertisers can continue to book placements with certainty on Auckland Transport’s out-of-home assets, buses and trains.”
Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor and has a small shareholding in NZME.
