JCDecaux bags billboard rights
JCDecaux, the world's largest outdoor advertising company, has launched divisions in Dubai and Oman.
The Paris-listed firm, which reported revenue of €2.46 billion (Dh11.9bn) last year, said yesterday that it had agreed a 20-year deal to handle street advertising in Muscat.
The company has also started selling billboard advertising in Dubai via its Première division, initially on two sites.
The launch of the Dubai division - which has not been officially confirmed by the company - marks the first time JCDecaux will sell advertising outside of the emirate's airport.
It has already secured two prominent sites near Dubai Media City, with one currently displaying an advertisement for the Mini car brand.
JCDecaux already holds the right to sell advertising at Dubai International Airport, and in 2010 won a 10-year contract to sell advertising at Dubai's new Al Maktoum International Airport. In a further regional expansion, JCDecaux Middle East said yesterday it had launched its operations in Oman through a 20-year contract with Muscat Municipality.
That contract includes the installation and maintenance of bus shelters, street-name poles, benches, litter bins and automatic public toilets, which will include a total of 640 advertising panels.
Jean-Charles Decaux, the co-chief executive of JCDecaux, said there was a "vast potential" in the Middle East region.
Thomas Kuruvilla, the managing director of the consultancy Arthur D Little Middle East, said the arrival of JCDecaux would help to improve the standard of outdoor advertisements in Oman.
"If you look at Oman, the quality of outdoor advertising is very poor compared to the other GCC countries," he said.
"The market size in Oman is definitely small compared with other countries.
"But the growth in outdoor advertising in Oman is the highest in the GCC region."
JCDecaux has operations in Dubai, Sharjah, Abu Dhabi and Doha.
One of its subsidiaries holds the rights to sell advertising in all 26 airports in Saudi Arabia.
Outdoor advertising was bolstered by the property boom in markets such as Dubai, where the right to display advertising on the most prominent billboards was sold for millions of dollars.
However, the outdoor advertising business was hit hard by the recession, and many billboards now stand bare.
Mr Kuruvilla said that while there may be some growth in the outdoor advertising industry, it was "impossible" that billboard rates would return to the peak levels seen during the property boom.
"The value of billboards [was] well beyond their real economic value," Mr Kuruvilla added. "It was not in line with reality."
Updated: February 23, 2012 04:00 AM