WMATA enters 10-year ad contract to build revenue for rail service

Washington Metropolitan Area Transit Authority (WMATA) last week entered into a 10-year, $336 million contract with Outfront Media Inc. to expand its digital advertising network in an effort to maximize revenue potential in support of rail service.

The contract calls for Outfront Media to replace 1,500 static advertising displays with digital screens at WMATA stations in the first five years of the agreement. Each screen generates up to four times the revenue of a static display, WMATA officials said in a press release.

The contract guarantees WMATA a 25 percent revenue increase. The funds will be used to support operational expenses and help WMATA stay within the legally mandated 3 percent annual subsidy growth rate, agency officials said.

The agreement also includes two five-year options. Those options included, the contract is valued at $812 million over 20 years, including $325 million guaranteed to WMATA, plus 70 percent of all revenue once each year’s guarantee is met; a $1.1 million investment in technology infrastructure to support the digital screen network; $10 million in capital funding for advertising assets; and 30 percent funding support for ongoing capital projects to provide the digital screen network.