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. Last Updated: 07/27/2016

Mayor's Office Thwarts City's Billboard Mania

The Kremlin's shadowy Main Security Directorate, in charge of guaranteeing the safety of the president and other high government officials, has a lot on its mind these days.

A Chechen terrorist could bomb the presidential residence. A disgruntled pensioner could take a poke at the prime minister for delayed pension payments. Or a billboard could fall on Yeltsin's head.

With billboards popping up on every Moscow street corner, Mayor Yury Luzhkov decided he should take no chances. In a September 1994 decree, Luzhkov tapped the powerful security detail as one of a string of official offices whose permission is necessary before a billboard can loom near government buildings or official cortege routes in Moscow, advertising agencies said.

Agencies cite the tortuous permission process as a hindrance to cashing in on Moscow's recent boom in billboards.

"It causes big problems because of the deadline" set by clients for ads to appear, said Anatoly Kukreyryev, who handles outdoor advertising at Young and Rubicam.

For a prestigious downtown billboard site, securing permission from the Main Security Directorate, as well as a slew of seven different municipal departments, can take up to four months, said Irina Antipima, manager at V.E.R.A. advertising agency, one of the most active firms in the outdoor market.

"Other cities are much easier. You can usually get permission there in one to two weeks, because other cities want to make money," Antipima said.

For its part, the Main Security Directorate, or GUO, which falls under the jurisdiction of powerful presidential bodyguard and eminence grise Alexander Korzhakov, doesn't seem pleased either.

"I'm afraid that's right," an employee of the security office said, sighing heavily, when asked to confirm the directorate's billboard activities. He said he could not elaborate, referring questions to the Moscow government. The city advertising department said Luzhkov's decree bears a stamp indicating it is not to be made public.

The process for advertising agencies can be a frustrating one. If V.E.R.A. has not first applied to the security office for permission, armed GUO guards come to chase away workers changing ads or repairing billboards rented by the agency, Antipima said.

Advertising agencies cited everything from faulty traffic lights to fear of a nebulous "someone" as the reason behind the top security office's concern over billboards. The GUO, after all, works in strange and mysterious ways.

After passing on an official billboard request through a city district advertising office to the GUO, Antipima said, agencies await an answer by special Kremlin courier.

Sometimes it never comes.

When it does, said Antipima, "there's no name on the letter, just a number -- like 'No. 33 agrees to your request.'"

Agencies receiving refusals from the Kremlin security flacks are left similarly adrift. "There's no reason given," said Young and Rubicam's Kukreyryev. "It's just a refusal and that's it. You can't do anything."

But according to an official at one of the city advertising offices that passes on billboard requests to the Kremlin, it's just business as usual.

"It's the same in any civilized country," said Vladislav Kodov, director of the central Reklama Center, the city's advertising office in downtown Moscow.

"It's a question of guaranteeing state security," Kodov said.

There is at least one known case of an individual linked with an advertising agency having to meet with Mikhail Barsukov himself, former head of the Kremlin guards and current chief of the Federal Security Service (FSB), to secure permission for a billboard ad.

And with the rapid increase in outdoor advertisements, the Main Security Directorate has been busy. Where there was open sky a few years ago, now loom more than 1,000 billboards, advertising everything from cigarettes to credit cards, according to estimates by ad agency J. Walter Thompson.

Responding to the bullish market, the city has doubled its rents -- priced in dollars -- for billboard plots twice in the past two years, said Antipima. The boom, advertising agency representatives say, is the natural result of spiralling prices for TV and radio advertising.

Renting space for a year on a standard, 3-by-6 meter billboard in the center of Moscow now runs about $8,000, not including taxes, Antipima said. Sites further out, but still fairly centrally located, such as Leninsky Prospekt, cost about $6,000. In the far north and south of Moscow, advertisers can find "very bad places" for their ads at a price of $2,000 to $4,000, said Antipima.

Prices for billboard space skyrocket around Moscow's Sheremyetevo airport -- reaching more than $18,000 per year, according to the Contact-Service ad agency.

Billboard advertising in Moscow is not necessarily more effective than television, said Roman Abramov, media director at J. Walter Thompson. "If you compare prices by means of [advertising] cost per 1,000 people" who actually see the ad, "[billboards] would be more expensive," Abramov said.

According to an industry sourcebook, whereas Russian TV commercials at prime time cost advertisers about 60 cents per 1,000 viewers, billboards come in at an estimated 95 cents, based on police traffic figures, he said. Costs are already close to the levels of western Europe, which average slightly more than $1 per 1,000 viewers, Abramov said.

Although key billboard advertisers remain Western firms, Russian clients, particularly banks, are now starting to move in, observed Natalya Raskazava, manager at Outdoor Video International.

"They've gotten through the first stage of advertisement -- that's TV -- and now it's billboards, I guess," Raskazava said.

While foreign outdoor companies like Big Board, Wall and Akzent Media hold about half the market, the Russian firm APR is now believed to have 40-50 percent of the billboard market, said J. Walter Thompson's Abramov.

Staking out an increasingly popular niche, the Russian agency Rosvero operates some 250 small-size "city-format" boards along prime rental space on Tverskaya Ulitsa.

To keep ahead of the competition, the Belgian firm Wall offered to replace free-of-charge the city's crumbling shelters with about 300 modern, illuminated bus shelters with advertisements, Abramov said.

"Right now [Russian firms] are still gathering experience, but they naturally know the market better," he said. "It's easier for them to initiate ties with the Moscow mayor's office and to install new billboards."

-- Yelena Klyuchenkova contributed to this story