City invites an open billboard tender

JAKARTA (JP): The city administration is inviting companies and advertising agencies to join an open tender for 163 spots for billboards in the city.

City spokesman Muhayat said here on Thursday that the new policy was taken after acknowledging that in the past the empty spots for billboards had been "awarded" to certain parties.

Muhayat did not reveal when the new policy was exactly introduced, but said that the city administration in the past set certain prices for certain bidders through unfair procedures.

In the past certain advertising agencies prevented other parties from joining the tender through collusion with certain officials.

Another official, who wished to remain anonymous, said that a company once complained after being prohibited from joining the tender by members of an illegal billboard syndicate.

"That's why only certain advertising agencies joined the tenders in the past," the official said.

According to Muhayat, an advertising agency could in the past hire a strategic billboard location for a certain period of time at a price lower than that set by the administration by bribing the officials in charge.

A company might give Rp 100 million or Rp 200 million to the official for a strategic spot, and the official would make a fictitious report to his superiors, saying that the spot was hired at a price lower than the administration asked for.

The advertising agency then 'sold' the spot to its client at higher price.

"In this way an official could take home a BMW sedan only by "selling" one spot, while the administration suffered more financial losses as the revenue target was never reached," Muhayat.

Lately, Muhayat said, the administration set higher prices for the spots as it wanted to increase revenue from the business.

"No single advertising agency was willing to buy the spots at the higher price," he said, without revealing the prices.

He said the prices of the billboard spots varied depending on the measurement of the space and the value of land in the area.

During a meeting with the City Council on Thursday, the Jakarta Chamber of Commerce (Kadin Jaya) and the Indonesian Outdoor Advertising Agencies Association (AMLI) questioned the city for not offering a tender for the 163 billboard spots sooner.

In a related development councillor Mardjuan Bakri confirmed the unfair practices in the billboard spot tender.

He cited an example of the huge billboard standing on Jl. Tanjung Karang, Central Jakarta. "The spot has always been awarded to a certain firm without a tender."

Separately, chief of the City Assets Office Hussein Djawas, who is responsible for billboard spot bidding, denied the allegation.

"The administration offered the space at Rp 1.2 billion a year, and no advertising agency has as yet paid for that space." (jun)