City Hall will count billboards

Holes in the budget will be covered with shields
City Hall takes on outdoor advertising
Yesterday, the Moscow government instructed its committee on telecommunications and media to develop a unified policy in the field of outdoor advertising, visual information and decoration of the capital. Billboards will be subject to strict accounting, and prices for outdoor advertising will increase. According to advertisers, these innovations by the Moscow authorities may lead to the washing out of small and medium-sized advertising agencies from the market.

The mayor's office began to put things in order in the capital's outdoor advertising back in March. Then the chairman of the Committee on Telecommunications and Media, Anatoly Lysenko, by his decree suspended the conclusion of contracts for the placement of billboards in the center of Moscow. The latest decree of the Moscow government should streamline the chaotic financial relations between agencies and authorities. The mechanism of action of the resolution has not yet been worked out. But the main directions of the mayor's office's new policy in the field of billboard advertising are known.
Over the next month and a half, the fee charged by the authorities for outdoor advertising will be increased (by approximately 20-30%) and a new procedure for mutual settlements will be established. Until now, money from advertising agencies came to the mayor's office as contracts were concluded with clients. Now, according to Sergei Zheleznyak, executive director of APR-city, agencies are required to pay the city a fixed amount in advance on a quarterly basis for the use of its space. According to Zheleznyak, such a measure, coupled with an increase in prices for renting advertising media, will allow the mayor's office to accumulate significant funds in a short time.
The inventory of city billboards, which the Moscow authorities intend to carry out before January 15, 1998, is also part of the program to bring order to outdoor advertising. Advertisers themselves agree that it is necessary to restore order: according to their estimates, the state of billboard advertising in the capital is far from European standards. The fact is that today there are contracts for renting advertising space, concluded back in the early 90s, which did not stipulate control over the technical condition of the billboards. Now only those agencies will remain on the market that can provide high-quality service to billboards - regularly wash them using special equipment, change burnt-out light bulbs, etc. Considering that the maintenance of such equipment and specially trained personnel “eats up” about 40% of the budget of any agency, small and medium-sized firms will be forced to leave this market. The “pirates” who unauthorizedly marked up billboards will also be unlucky. During the inventory process, new owners will be found for the “orphan” shields.
Large companies will also have a hard time. “We are already under the constant control of the authorities,” says Sergei Zheleznyak, “and the planned tightening of placement rules will inevitably lead to a decrease in the company’s profitability.”
Advertisers will likely compensate for losses by raising prices, at the risk of losing customers. By the way, many advertisers are not satisfied with the current price level. For example, Coca-Cola has already refused to advertise in the Eastern and North-Eastern districts of Moscow.
TATIANA Kommersant-PLOTNIKOVA, OLGA Kommersant-LIKHINA

Newspaper "Kommersant" No. 150 dated 09.09.1997, p. 7