Outdoor business in state of flux on back of government actions
Some executives in the Out of Home business, especially in Lagos Nigeria, may exchange greetings and pleasantries but there are grim lines on their faces on closer look. When discussing the industry, their statements are embedded with depressing comments. This simply suggests that all is not well with their business in the state.
They know the issues frustrating their business and they are bent on addressing them through dialogue, consultations, lobby and push in order to survive as the turbulent time is already biting harder. Unfortunately, Lagos government appears less favourable disposed to all the entreaties employed by the operators to get it listen to their plight.
Most influencers in the state have listened to the OOH operators’ dilemma but their intervention, according to a source is either hitting the rock or yet to hold water.
The issues
First, some of the OOH players are demanding for the payment of over N1 billion debt purportedly incurred by Lagos State government through its agency, Lagos State Signage and Advertisement Agency, LASAA under the former managing director, George Noah during the 2015 general election.
The Out of Home players are contending that George Noah had engaged about 30 outdoor operators to execute All Progressives Congress, APC presidential and gubernatorial campaign in the state amounting to about N1 billion costs.
Part of the agreements in the deal, as alleged was that the operators would provide their billboards for the political campaigns and subsequently the debts the outdoor companies owed the LASAA would be cancelled on the costs each operator incurred in their supposedly deal on agreed ratio.
It was said that these outdoor companies ensured that Buhari and Ambode billboards took over 95% of the available billboards in Lagos but one year after they have not been paid nor their debts to the agency cancelled.
Available information also indicates that the new LASAA CEO, Mobolaji Sanusi has equally refused to honour the payment agreements on the excuse that George Noah, acted on his own and not on behalf of the agency.
It is said that the outdoor agencies jumped in to the deal with Noah without proper guidance as source believed that Noah entered into the political advertisement deal with the about 30 outdoor agencies through a company called Mediaworth and not LASAA.
“The outdoor agencies should have known that they were entering in to the deal with another company appointed by Noah and not LASAA and that is why Sanusi, the present CEO of the agency is not honouring the payment”.
According to the source, the agencies were perhaps misled on the fact that Noah was the CEO of LASAA and they, without thorough due diligence committed themselves to the business.
However, the owed members are presently being chocked over the debt, compounded by environmental challenges including cut in advertisement by clients. They are however employing every available means to get Lagos to listen to them on the deal which assisted to see APC win Lagos State election.
Payment of fees for vacant billboards
Thirdly and more worrisome is that the agencies are made to pay their indebtedness to LASAA in the face of being ‘owed’ such heavy amount for ‘gentleman’ agreement reached during the elections to secure APC win. This is further strangulating their business.
In addition to this, the outdoor operators some of whom have not fully recovered from demolition of their billboards in the early days of LASAA are presently charged fees for billboards that even do not carry adverts. It was gathered that the operators under their umbrella body has made representations on this.
Alleged bringing of foreign agency
Babatunde Adedoyin led outdoor industry association, Outdoor Advertising Association of Nigeria (OAAN) which is also battling with double taxation, harassment by touts and cut in budget spend by companies is seeing another battle on its hand.
There is an allegation that Lagos State Government is planning to bring in a French agency, Jean Claude Decaux, to take over outdoor activities in the state.
It is said that the agency would not only come in just as a practitioner but would be repository of the outdoor advertising business.
Aside the fact that bringing in J C Decaux will lead to job loss, many have raised the question around local content and capital flight. At a time Nigeria is undergoing serious economic recession, pundits believe that bringing a foreign agency into industry that is struggling to survive is like killing the business of local practitioner, thereby creating another phase of poverty in the land.
Adedoyin could not be reached for comments, but in a report he was quoted as saying that association has had about it but that it still remains a rumour relying on some advertising authorities’ statements.
Too much weight on the sector
Weighing all the issues against outdoor operators, Adedoyin recently in a statement said “Outdoor sector has become endangered specy in the country as practitioners contend with regulatory bottlenecks and harsh economy. From left, right and front, we are being batched. Government careless about our challenges and keep putting pressure on us, not minding the challenges we are facing as businessmen. Outdoor practitioners are not operating in isolation but within the same harsh economic environment and government appears not to be concerned about our plight”
Presently, some of the operators have downsized workforce in other to stay afloat. Already, the combined forces are hitting hard on the industry.
Daniel Obi