Airport naming rights for sale?By Andrew F. Hamm
SILICON VALLEY/SAN JOSE BUSINESS JOURNAL
Updated: 8:00 p.m. ET June 12, 2005
So, how do you like the sound of Cisco Systems International Airport?
How about HP Terminal?
Mineta San Jose airport officials are seeking an advertising firm to sell naming rights to various parts of San Jose's airport as a way to increase revenues.
And while airport officials admit taking former San Jose mayor and current U.S. Transportation Secretary Norman Mineta's name off the airport isn't likely to happen, they are trying to figure out how far they can go in their search for more ad dollars.
"We're really talking about, say, Fisher-Price Playland," says Irv Tosk, operations supervisor at Mineta San Jose. "Maybe Cisco Lounge. But it could be 'North Concourse sponsored by, say, Apple."
Aviation Director William Sherry wants to hold a debate on where the airport draws the line.
"It's not a bad concept but it has to be kept in check," Mr. Sherry says.
Sports stadiums and entertainment arenas have been adopting corporate names for years, including San Jose's own HP Pavilion. Universities have put corporate and private individuals names on buildings in exchange for sometimes hefty donations.
But public buildings have been another matter all together.
"It's one thing to name a building after an historic figure and another to name it after a corporation," says Ed Lozowicki, an attorney with San Francisco-based Sheppard Mullin Richter & Hampton LLP who handles commercial contract law. "The difference? Good taste."
Yet, while you won't see Cisco's name on San Jose's city hall for more than one reason, the city is interested in seeing what new forms of revenue can be generated, city spokesman Tom Manheim says.
"It's certainly a time that the city will look for any smart way to raise revenue," Mr. Manheim says.
The San Jose city council has directed staff to find sponsorships "that make sense," says Dave Vossbrink, spokesman for Mayor Ron Gonzales.
"That doesn't mean you will bless every suggestion," he says.
Naming rights is part of one of four advertising contracts the airport will be placing out to bid July 1.
The four-part contract includes:
Fixed displays -- Banners, wall or even window advertising.
Outdoor advertising -- Advertising on buildings, overhangs or billboards.
Transit/bus shelters -- Spaces on shuttle buses and waiting areas.
Marketing income -- Selling the Mineta San Jose name and/or the names to individual buildings.
The airport gets about $2.2 million in advertising annually, but Mr. Tosk says the potential is much higher.
For instance, the airport has no advertising on its buses or bus shelters simply because its present advertising firm -- a French firm, J.C. Decaux, with offices in New York -- has no experience in that field.
The airport could award one or as many as four advertising contracts, Mr. Tosk says.
Mineta San Jose is a sought after market because of the high number of business people using the airport. Indeed, its 64 cents of advertising revenue per passenger dwarfs Oakland's 8 cents a passenger average.
However, the airport has virtually no representation from such Silicon Valley firms as Apple Corp., Intel Corp. and the like.
"We'd like to see that change," Mr. Tosk says.
There are other considerations when discussing advertising, including deciding how much is too much, Mr. Sherry says.
"We don't want it interfering with critical airport signage" like flight schedules, directional signs and the like, he says.
Airport officials will want potential advertisers to be creative in their displays, even providing interactive booths and lighted displays that provide "a sense of space," Mr. Sherry says.
But that could run into conflict with the ambitious North Concourse art program. That $3.8 million project will compete with advertising and information signage for space.
"Philosophically, we want a minimalist approach," Mr. Sherry says. "For instance, if advertising firms want the restrooms, I think that goes too far.
"We want less signage with a bigger impact."