China Economic Review
Charting China’s changing economic terrain · Since 1990
VisionChina to acquire Digital Media
October 20, 2009
There is no escape from electronic advertising in China and this new deal means it will get worse. VisionChina Media has bought for $160 million Digital Media Group and this will come into effect early next year.
Thus one of China’s largest out-of-home digital television advertising networks on mass transportation systems acquires a leader in the China’s subway mobile television advertising market thus creating the largest and most comprehensive mobile television advertising network in China.
This furthers VisionChina Media’s goal of becoming the foremost digital television platform reaching daytime audiences in China. There will be no escape.
It may be that at some point the public will rebel.
Already in taxis it is commonplace to find the screen covered over so that passengers are not continually annoyed. If advertising seriously annoys a measurable percentage of the population with its intense visual pollution is it still effective as an advertising medium?
The combined company will operate bus networks in 18 of China’s most affluent cities, including Beijing, Guangzhou and Shenzhen. The combined company will also have exclusive subway networks in eight key cities in China, including all four of China’s Tier I cities, Beijing, Guangzhou, Shenzhen and Shanghai, as well as on Hong Kong’s Airport Express line.
According to Analysys International, VisionChina Media operated 42.1% of the digital mobile television screens and DMG operated 8.1% of the digital mobile television screens in China in the first half of 2009.
Limin Li, chairman and chief executive officer of VisionChina Media, noted that government policies in China support extensive development of new, massive public transit systems in China and that subway systems have become common in large cities as a vital form of transportation.
He threatened, "The combined company’s fully integrated advertising network will deliver real-time television programming to passengers during their commutes." For programming read advertising.
Reuters PR stated that by giving VisionChina a strong foothold in all four of China’s Tier I cities, where approximately 60% of China’s advertising dollars are spent, as well as immediate access to the important Shanghai market, this transaction is a great step forward in VisionChina Media’s strategic expansion plan.