Quick Take: Potential OOH Market Consolidation
IHeartMedia Inc., one of the largest radio-station owners in the U.S., filed for bankruptcy March 15 in Houston, Texas, with a plan to halve its debt load of more than $20 billion. While at first glance, this doesn’t seem like it applies to the print side of the business you have to remember that before 2014 IHeartMedia was known as Clear Channel.
One of IHeart’s subsidiaries, Clear Channel Outdoor, is one of the world’s largest outdoor/out-of-home (OOH) advertising companies with more than 675,000 displays reaching more than half a billion people in more than 40 countries on five continents each month. In the U.S., Clear Channel Outdoor operates in 45 of the top 50 U.S. markets and is one of the leading outdoor advertising companies.
IHeart’s traditional businesses, which include more than 850 radio stations and the Clear Channel Outdoor billboard unit, still contribute the bulk of its revenue. According to Bloomberg, IHeartMedia’s $20 billion in debt makes it the largest bankruptcy in the last year, and around the 30th largest ever.
While Clear Channel Outdoor Holdings, Inc. and its subsidiaries did not commence Chapter 11 proceedings last week, French advertising company JCDecaux SA has expressed interest in the billboard subsidiary.
JCDecaux SA’s network of outdoor advertising displays is one of the largest in the global media industry. Every day, JCDecaux reaches more than 410 million people. According to the company’s website, JCDecaux SA is in more than 75 countries and 4,033 cities and has 1,074,113 advertising panels worldwide.
JCDecaux North America reaches millions of Americans everyday. JCDecaux offers advertising programs in 22 national airports, 23 major shopping malls, and on street furniture in New York, Los Angeles, Chicago, Boston and San Francisco.
It will be interesting to see where this goes and how this will impact the OOH market long-term. We will be keeping on eye on any developments coming from this news.
Update: In a Wall Street Journal article on March 19, JCDecaux confirmed its interest in Clear Channel Outdoor. The French company currently only has 5% market share in the U.S. and this acquisition would increase that number to 15%, giving them a much more substantial base.
Denise Gustavson is the Editorial Director and Special Projects Editor for the Printing & Packaging Group, which includes Printing Impressions, packagePRINTING, In-plant Graphics and Wide-Format Impressions magazines, among other brands. She is also the Editor-in-Chief of Wide-Format Impressions.