Like many of the nation's public transit operations, the Metropolitan Atlanta Rapid Transit Authority has struggled to make ends meet. But, as part of a 10-year deal with the Rail Network, MARTA soon will earn cash from advertising that will air on wireless audio and video systems, to be installed on its trains next month.
The agreement guarantees MARTA 20 percent of all ad revenue—or a minimum of $2 million a year. This should help the organization, which has fallen short of its $340 million budget for the past several years.
The New York-based Rail Network is installing five 15-inch flat-screen monitors in each of MARTA's 238 rail cars that will air news and ads. The system also provides access to six FM stations: three play music, one provides information about MARTA, and two offer audio for the TV in English and Spanish. As a promotion for the launch, the company will give away 230,000 FM radios to MARTA riders.
Though several transit systems have video on buses, including Atlanta, Orlando and Milwaukee, MARTA is the first in the country to install the Rail Network system. Generally, the video is delivered by satellite and the audio is delivered over a loudspeaker system. The Rail Network uses a wireless technology that allows video to be uninterrupted by tunnels (for subway systems), and because the audio comes through FM radio, it is less intrusive, the company said.
Rail Network CEO David Lane said he has discussed its system with mass transit officials in New York, Washington and Vancouver, British Columbia, as well as overseas. Steven Taubenkibel, Washington's transit system representative, confirmed discussions with the Rail Network and said the system is struggling to make its $1 billion operating budget.
The guaranteed $2 million a year is a big boost to MARTA's previous annual ad revenue total of about $6 million, said MARTA representative Joselyn Baker. (New York's Metropolitan Transportation Authority, by comparison, took in $70 million from advertising last year, while the Chicago Transit Authority projects $20 million in ad revenue for 2005, largely from placards and bus sides.)
Atlanta has been forced to use a reserve fund to pay operating expenses for the past several years and expects to draw from the fund again this year, Baker said.
Four companies already have signed deals to advertise on the network in Atlanta: MetroPCS, Chevrolet, Cadillac and American InterContinental University. "It's a way for us to reach people on the trains in an unobtrusive manner," said Michael Johnson, regional vp of sales and distribution for MetroPCS.
Media planners and buyers who attended a demonstration of the system last month also responded positively. Eunice Hong Carter, media supervisor at Interpublic Group's Fitzgerald + Co. in Atlanta, said the venue would be good for many of her clients. "We will encourage clients to go on MARTA and see it," she said.
Content will be provided by a local ABC affiliate, which has signed a deal with the Rail Network to provide four half-hour local news segments each day. Lane declined to discuss the terms of their agreement or ad pricing, but said his company will place nine and a half minutes of ads on each 30-minute segment, the same ratio as on regular television, he said.