BARRIERS TO ENTRY
High Upfront Capital Investment
- Capital expenditure requirements for setting up a DOOH service provider includes digital equipment needed for transmitting contents and advertising such as digital screens, media players and speakers.
- A new provider will need to attract talents to form a content development team to create high quality content to be shown in the digital screens and to maintain a technical team to install, maintain and service the equipment in the transit vehicles.
- Hence, it would be extremely challenging for new provider to complete efficiently against our Group.
- Our Group has signed an exclusive agreement with RapidKL, which owns the largest bus network in Kuala Lumpur, to be its DOOH transit media provider in all Rapid KL Buses.
- Exclusive agreements with the transit operators make it difficult for new players to enter the market and take over contracts with transit operators.
- Transit providers may prefer to renew its collaboration with existing media providers if they have built a trustful relationship with those industry players.
- Operationally, it is also difficult to frequently change media service providers as different operators own and use different forms of equipment and technology, and a change in operator would entail a massive and lengthy redeployment of systems and equipments.