The City of Sydney is considering canceling its $300m out of home ad tender due to a lack of competitive bids and the upgrade Telstra’s payphone network.
The City is said to be considering running the street furniture network itself following clashes with incumbent JCDecaux.
The contract is believed to be worth up to $300m, but includes tens of millions of dollars of capital expenditure to bring the network up to date through digital billboards and Wi-Fi connectivity.
Next Monday, Sydney councilors will discuss recommendations to provide City of Sydney chief executive Monica Barone the ability to directrly negotiate contracts for street furniture such as bus shelters, advertising and Wi-Fi services, instead of running a new tender.
A council spokesman said: “The City of Sydney remains committed to securing a provider for its street furniture, out-of-home advertising and Wi-Fi services.
“A report to be considered by council recommends declining a proposal for street furniture, out-of-home advertising and Wi-Fi services following the completion of an extensive tender process. The report also recommends the City of Sydney’s CEO be given authority to explore alternative options to deliver these services.”
The City of Sydney recently clashed with incumbent JCDecaux and its partner Telstra over the duo’s deal to upgrade the telco’s payment network.
Last month, the City of Sydney joined Melbourne in a fight against Telstra to stop the telco brand from installing new payphones with advertising display panels around the city.
A spokesperson for the City of Sydney said: “We dispute that Telstra is entitled to install these payphones using these powers.
“We are of the view that equipment being installed is not designed solely for use as a content and carriage service as required.
“We are also of the view that the equipment does not comply with the criteria for low-impact facilities under the Telco Act.”
The City formally disputed Telstra’s plans when they sent a formal notice to the company in late February and is now awaiting instruction from Sydney Council, led by Lord Mayor Clover Moore.
JCDecaux has held the City of Sydney contract since 1997.
Losing the contractor would be a massive hit to the business, which paid $1.2 billion for APN Outdoor in Australia less than a year ago.
A decision about the tender will be made on May 13.