Gail Chiasson, North American Editor
San Francisco-based RMG is planning to sell off its Fitness and its NY Times.com Today networks so it can expand and focus on its primary business channels reaching executives in airport lounges, taxis, Amtrak trains and in-flight and developing robust distribution software for Digital Signage Networks.
“We know that our executive networks are the ones most interesting to advertisers,” says Chuck Strottman, vice-president corporate marketing, RMG Networks.
“Further, our sales people were being stretched too thin trying to cover all sectors. Our aim is to focus our sales team so that they have one product to sell: how to reach the traveling executive. By focusing on a single audience, an advertiser will be able to reach executives when they get into a taxi, get to the airport, fly in the plane, or get on train.”
To better focus on these fast growth segments, RMG will exit the Fitness and Retail segments (ie the NY Times network in coffee shops) and we understand that negotiations with potential buyers are underway, with new owners expected to be announced for one or both within the next two or three weeks.
RMG controls the largest, national network of digital video advertising across US airlines representing 100% seat-back in-flight entertainment screens. RMG’s Airport/Airline network spans the general concourse at the nation’s top airports, major executive private airline lounges in the top markets, private airports in 47 markets, and over 110,000 In-flight-entertainment screens in Delta, United, Jet Blue, Virgin America, Frontier, and Alaska Airlines. The company indicated that the demand for this targeted, captive video media has outpaced inventory availability in recent months.
RMG is focused on helping airlines create value through innovative new media assets, and by connecting advertisers with hard to reach Executive Business Decision Makers in captive media environments.
It also has screens in the Amtrak Acela Expess line that runs between Boston and Washington, D.C., as well as several other Amtrak lines on the U.S. East Coast.
And it has screens in 4,000 taxis in such centres as Washington, D.C., Sacramento, Denver and other cities, where it also works with Taxi Magic for mobile call and payment.
“People seem to have the idea that all the taxis with screens are in New York,” says Strottman. “In reality, New York has only 8% of the total.”
The Fitness network being divested includes about 500 locations with 6,000 screens. The retail network has about 600 locations and 600 screens.
RMG had recently announced a new strategic partnership with DIRECTV with the goal of bringing digital signage and live TV to commercial businesses, through the creation of a product called DIRECTV Message Board. The DIRECTV Message Board product will be sold by DIRECTV’s 6,000 resellers across the United States.
Garry McGuire, RMG’s CEO, says, “We believe this DIRECTV Message Board offers a powerful tool for gyms, fitness centers, and retail businesses. The sale of the Fitness and NYTimes.com Today Networks will avoid any product conflict with RMG’s own networks.”
RMG also operates an Advanced Technology Lab, employing 25 engineers with offices in Beijing, China and San Francisco. This business is focused on developing digital signage products for live TV and place-based video networks.
April 11th, 2012 at 12:46 @574
[…] news out today that RMG Networks plans to divest its fitness club and coffee shop networks in order to […]
April 11th, 2012 at 14:40 @653
Smart, smart, smart! RMG’s focus on a difficult to reach target may be one of the few methods for success in this space which is littered with the corpes of poor business plans and under-funded efforts.
April 11th, 2012 at 16:46 @740
Seems smart – shall we also lump RMG and its alphabet soup SF neighbor PRN into the category of the “incredible shrinking company”? What is similar is the contraction of low engagement retail networks. Also in those that have awful revenue histories with continued significant media agency pushback. If you couldn’t sell it five years ago, you won’t be able to sell it now with even more competition for dollars and engagement.
And can we now laugh about the pomp and circumstance that is an RMG announcement – NFC and the NY Times Network, DirecTV, and IPO? LOL.
April 11th, 2012 at 16:55 @747
Big difference from the UK….normally the networks just go bust! 😀