Profile: Focus Media Holding Ltd (FMCN.OQ)
17 May 2013
Focus Media Holding Limited (Focus Media), incorporated on April 11, 2003, is a multi-platform digital media company, operating liquid crystal display (LCD) display network in the People’s Republic of China using audiovisual digital displays in commercial and residential locations. The Company operates liquid crystal display (LCD) display network, poster frame network, in-store network, movie theater advertising network and outdoor billboards. Its LCD display network, which refers to its network of flat-panel digital displays placed in areas of commercial, residential and public buildings, such as malls, hotels and the lobbies of apartment buildings, marketed to advertisers as separate channels targeting different types of consumers, including its A1 channel, A2 channel, and LCD 2.0 digital picture screens channel. Its poster frame network, which refers to its network of picture and digital advertising poster frames placed in the elevators and public areas of commercial or residential buildings. Its poster frame network, which refers to its network of picture and digital advertising poster frames placed in the elevators and public areas of commercial or residential buildings. Its in-store network, which refers to its network of flat-panel digital displays placed in specific product areas inside stores, such as selected consumer product sections and the aisles in chain retail stores (hypermarkets), as well as inside selected supermarkets and convenience stores. Its movie theater advertising network refers to its right to sell advertising time on movie screens prior to movie screenings at movie theaters in the People’s Republic of China.
The Company’s traditional outdoor billboards refer to a traditional advertising business of outdoor billboards. This portion of its network is operated by Hua Kuang Advertising Company Limited (Hua Kuang), Shanghai OOH Advertisement Co., Ltd. and other the People’s Republic of China subsidiaries under Hua Kuang (collectively referred to as OOH). The OOH business consists of advertising services focused on giving advertisers access to traditional outdoor billboards. OOH owns or leases the billboards from landlords and other agencies, and provides such billboards to the advertisers who want to put advertisements in such spaces. As of December 31, 2011, its LCD display network was consisted of 155,751 display devices, consisting of 122,115 LCD screens and 33,636 LCD 2.0 digital picture screens, and its poster frame network was consisted of 480,176 poster frames, consisting of 35,050 digital poster frames and 445,126 traditional picture frames, including 30,804 LCD 1.0 picture frame devices re-categorized from the LCD display network.
LCD display network
As of December 31, 2011, approximately 32% (LCD television screens only) and 42% (LCD television screens plus LCD digital 2.0 picture screens) of the displays in the LCD display network were located in commercial office buildings. The locations in its LCD display network also include shopping malls, banks, hotels and other public areas. It markets its LCD display network to advertisers of consumer products and services, such as fast moving consumer goods, automobiles, home electronics, mobile communications devices and services, cosmetics, health products and financial services. As of December 31, 2011, its LCD display network, including the portions of its LCD display network operated by its regional distributors, was consisted of 155,751 flat-panel digital displays placed in approximately 114 cities throughout the People’s Republic of China. Its LCD display network consists of flat-panel digital displays, including LCD screens, LCD 2.0 digital picture screens, which carry the Focus Media logo. The display devices on its LCD display network show video images, as well as fixed images. As of December 31, 2011, it operated its LCD display network directly in approximately 81 cities and indirectly through contractual arrangements with regional distributors in approximately 33 additional cities. As of December 31, 2011, the Company had stand-alone channels, which were marketed as separate focused channels of its LCD display network, including its A1 channel, A2 channel, and LCD 2.0 digital picture screens channel.
Movie theater advertising network
The Company operates its movie theater advertising network by selling leased screen time as time slots to advertisers. It has the right to screen time prior to the screening of each movie shown in the theater. As of December 31, 2011, it had rights to lease advertising time on screens in 316 movie theaters (consisting 2,190 screens) in cities across the People’s Republic of China.
As of December 31, 2011, the Company had placed 50,076 flat-panel digital displays in 1,576 hypermarkets, 217 supermarkets and 1,008 convenience stores throughout the People’s Republic of China. It provides in-store network for advertisers of food and beverage products, cosmetics, household, kitchen and bathroom products.
Poster Frame Network
The Company owns and operates a network of traditional and digital advertising poster frames deployed in the elevator lobbies, elevators and public areas of residential and commercial buildings, as well as other public locations. It places advertising frames in elevators in which it leases space and sells frame space to advertising clients on a per frame basis for periods of one week or longer. As of December 31, 2011, it had installed 414,322 traditional poster frames and 35,050 digital poster frames in cities throughout the People’s Republic of China, as well as 30,804 LCD 1.0 picture frame devices in Tianjin, Kunming and Shijiazhuang. Its digital frames use LCD displays. Its advertising posters include both traditional printed posters, as well as digital LCD poster frames placed in elevators and public areas in residential complexes and commercial locations.
Traditional billboard network
The Company operates an advertising business for traditional outdoor billboards. The network consists of outdoor billboards in high-traffic areas in Beijing, Shanghai, Guangzhou and tier-II cities, as well as, traditional poster billboards installed by the roadsides of national and provincial highways and on the top side of building structures, as well as advertisement light boxes installed inside public buildings. Its subsidiary OOH, leases the billboards from landlords or other billboard advertising operators, and provides such billboards to the advertisers who want to put advertisements in such spaces. The media assets of its businesses, such as its LCD display network and poster frame network, to be placed in locations, such as commercial and residential buildings. In addition, its core businesses utilizes digital media assets, which can accommodate multiple advertisements in a given time period. OOH is an advertising company, which targets demographic with traditional advertising assets, such as traditional billboards placed on roads and streets. OOH relies on traditional media assets, which only allow for one advertisement for a given time period.
The Company competes with JCDecaux, ClearMedia, SearchMedia, AirMedia and VisionChina.
Focus Media Holding Ltd
Zhoa Feng World Trade Building
369 Jiangsu Road
Shanghai F4 SHA 200050