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. Last Updated: 07/27/2016

City Earns $20M in Metro Ad Auctions

City Hall on Thursday sold the rights to sell advertising on seven metro lines next year for 251.2 million rubles, bringing total revenues from a series of auctions to 607.2 million rubles ($19.15 million).

Metros-Media's monopoly on metro advertising will come to a close next year, but the company will retain most of those rights after it and its dealer bought up the rights to most metro lines.

City Hall decided in April -- shortly after Metros-Media general director Alexander Babayan was arrested and sentenced to seven years for extortion -- that it could boost its income from the metro advertising market by holding the auctions, which it estimated would bring in a total of $18.3 million.

Rights to sell advertising on the Serpukhovsko-Temiryazevskaya line have yet to be auctioned because bidders say the starting price of 68.2 million rubles is too high.

Another auction for the line is to be held in a month and a half, said Yury Mosunov, deputy head of the Moscow property department and head of the commission holding the auctions.

"Starting prices were determined according to estimations by the metro advertising dealers and the metro itself," said Mosunov, adding that the property department would undertake marketing research to determine the starting price for the Serpukhovsko-Temiryazevskaya line.

He also said the city government is considering contracts of up to five years for the rights to sell ads on the metro.

The metro advertising market was worth a total of $15 million last year, according to estimates by the Espar Analitik research agency. However, it is difficult to estimate turnover for 2002, Espar analyst Andrei Beryozkin said.

Almakor Advertiser Group, Metros-Media's dealer, won the rights to sell advertisements on both the Zamoskvoretskaya and Kakhovskaya lines for 102.31 million rubles and on the Tagansko-Krasnopresnenskaya line for 82.41 million rubles in Thursday's auction. Almakor overbid the starting price by 10,000 rubles in both cases.

TV-Proyekt won the rights to sell advertisements on both the Arbatsko-Pokrovskaya and Filyovskaya lines for 36 million rubles and on the Kalininskaya line for 18.5 million rubles.

Maxima, part of the AFK Sistema holding, won the right to sell advertisements on the Lyublinskaya line for 12 million rubles.

The city sold the rights to three other lines for a total of 356 million rubles in the first stage of the auctions in August, but at that time no bids were received for the lines sold Thursday and the remaining Serpukhovsko-Temiryazevskaya. Starting prices were then dropped by 10 percent.

Metros-Media won the rights to sell advertising on the Sokolnicheskaya line for 86 million rubles and on the Kaluzhsko-Rizhskaya line for 145 million rubles at the August auctions, while Almakor got the lucrative ring line for 125 million rubles.

Moscow's outdoor advertising majors -- News Outdoor, part of Rupert Murdoch's News Corp., Vera-Olimp and Clear Channel -- declined to participate in the August tender, saying the starting prices were too high, Vedomosti reported in September.