MediaWorks currently has the contract to run bus advertising for AT.
Auckland Transport says it is restarting a critical advertising tender process because of the need for modifications. It’s also revealed that it earlier accidentally released commercially sensitive sales information to participants.
The advertisements are bold, in your face and everywhere on Aucklanders’ daily commute. But behind the bright marketing slogans on bus shelters and billboards, an intense and overly prolonged battle has been playing out, as outdoor advertising companies seek a slice of the biggest media procurement in New Zealand history.
Auckland Transport (AT) was, by now, supposed to be three months into a new 10-year deal with selected outdoor advertising companies to look after the ads on the region’s bus shelters, billboards, trains, buses and ferries; and at train stations and transport hubs.
But progress in awarding five contracts – believed to be valued at $350 million over the next 10 years – has been as slow as an 8am crawl along Auckland’s Southern Motorway.
Herald inquiries, from an Official Information Act (OIA) request, show AT has so far spent at least $1.1m in contractor costs and salaries on trying, and failing, to land the contracts.
The new deals were due to be operational from January 1 but AT has been taking the outdoor companies on a not-so-merry ride.
It is now set to announce an update on a new RFP (request for proposal) process this week, with the hope that new contracts will be in place by the end of the year.
In December, when AT suddenly pulled the pin on the already 18-month process, it refused, publicly, to say why. A media manager said at the time this was “confidential”.
AT’s decision left the industry outraged and bamboozled, although few of the companies have been prepared to go on the record for fear it would harm future opportunities.
“It’s been a clusterf***,” one source told Media Insider.
“They’ve had no idea what they’ve been doing. They had no idea of the scope of the project. And that is very evident in the fact that we are now going back to an RFP [request for proposal] again with new parameters after 18 months.”
AT has taken almost three months to release to the NZ Herald limited official information, including a notice that it sent to outdoor companies on December 10.
In that notice, AT told RFP participants that it had decided to “extend” the procurement process based on a “further review of market dynamics and transition risk as well as market feedback. This review also suggested the RFP process would benefit from some modifications”.
The use of the term “extend” might be considered a stretch, given that the RFP will be reissued with “modified evaluation criteria and bid structure”.
The process essentially has to start all over again, although AT says in the notice it “will endeavour to minimise any additional effort required from participants”.
The notice said, “This is not a decision that AT has taken lightly, considering the amount of effort to date from all parties involved. We understand that this is disappointing for participants and the out-of-home media sector.”
In a response to further questions from the Herald, AT chief financial officer and director corporate services Mark Laing said: “Last December, the Auckland Transport board and executive team thoroughly reviewed the process undertaken for AT’s out-of-home media procurement and identified a number of improvements that could be made.
“Because we haven’t informed participants about any changes to the procurement requirements we aren’t able to share details of these changes at this stage.”
The industry will want to know exactly what has changed in the RFP, and that this new process is not simply a box-ticking exercise to overcome any previous process issues.
MediaWorks, which currently looks after advertising on the AT buses and some billboards, was long rumoured to be the frontrunner to win the lion’s share of the contracts. But there are a number of other industry players, such as OohMedia – which currently looks after advertising at bus shelters – JCDecaux, Go Media and Lumo.
AT has confirmed that, last February, some “historical sales data for AT’s out-of-home media assets” was accidentally released to some industry participants.
It is understood this was sales data belonging to MediaWorks. Both AT and industry sources did not believe it had caused procurement delays.
“The disclosure of this information was unfortunate and was the result of a genuine mistake,” said Laing, in a written response to the Herald.
“AT promptly apologised to the parties involved for the unintended disclosure. This disclosure occurred before the release of the RFP and didn’t affect the procurement process.”
Asked whether the disclosure led to any employment action or legal correspondence, AT said it would not be appropriate to comment.
One source said while the incident might not have impacted the tender process, it did undermine trust for some in AT. “It’s a circus.”
AT says three contractors have collectively dedicated 600 hours to the outdoor tender project between June 1, 2023 and December 13, 2024. Their estimated total payments were $780,266.
Two fulltime AT staff members have also worked on the project, one on an annual salary band of $113,450-$170,200 and another on a band of $134,650-$201,960.
Taking the two lowest numbers in those bands, the salaries for 18 months would therefore have totalled a minimum $370,000. At the higher band, it’s a total salary cost of $556,000.
So with the contractor costs, the total amount spent on people resources has so far been between $1.15m and $1.34m.
AT reveals it also conducted 35 official meetings about the project between June 2023 and December 2024. According to its official information response, there has been one further meeting on the subject this year, on January 20.
“Ultimately our focus is on delivering the best possible result for ratepayers at a time when revenue growth from AT’s out-of-home media assets is more important than ever as the Government sets its expectations for the share of public transport costs met by passengers and commercial revenue from assets like transport network advertising,” said Laing.
“AT’s investment in the process has not been wasted as the work undertaken to date will help ensure AT’s procurement process delivers the right outcomes and provides a strong foundation for robust media partnerships that set AT up well for the future.”
In December, AT told RFP participants it was working on a new timeline and the process was “anticipated to restart in late February/early March”.
It told the Herald last Thursday that it expected to provide a market update within a week.
AT chief executive Dean Kimpton would not be interviewed for this piece.
“We expect to have new contracts in place before the end of the year and we’re looking forward to working with our media partners on the exciting opportunities the City Rail Link opening in 2026 will provide for our customers and advertisers,” said Laing.
Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor and has a small shareholding in NZME.
NZ is one of the first jurisdictions in world to clear the way for OMG and IPG to merge.