I guess it comes from my years as an exec in technology companies. Here is a case where the management feels strongly enough about using technology to mention it in an SEC filing. They then go on to include mention of a pilot program being conducted on the upgrade in a recent investor presentation. However now I hear a private investor stating that we shouldn't expect this to be rolled out based upon a private conversation. That starts to run into selective disclosure rules. While I'm not saying this stand alone is something to overreact to, I do find it disconcerting that they would disclose publicly about plans and privately discount that probability.
The bigger issue for me is that there appear to be many positive attributes to a wireless content/advertising policy:
- Updating content 2x a month and advertising 1x a month on a manual basis as compared to daily.
- Targetted advertisments that are route specific and take into account what an advertiser is trying to unload as in the case of the shelf reference in the 10k.
- Production costs for new embedded ads will see an accelerated ROI if they can roll them out upon completion rather than waiting for weeks.
- With 26k buses in 8 aiports and 19 city/provinces and a plan to roll out a new tour bus initiative I find it tremendously hard to imagine that it wouldn't be cost effective to use technology to replace a manual effort. Even putting cost savings aside, the efficiency demonstrated to bus operators and advertisers seems compelling as it shows vision and a signal that CCME is going to embrace continual process improvement.
- Having a wireless component seems natural for both SWITOW or and on arrival offers. How can the facilitate a transaction en route without wireless?
Maybe I just don't understand enough but this seems a natural progression and one that they have already put into motion by disclosing it and starting a pilot. To hear that this is not the case just seems confusing. The have the cash and a window where it's a virtual monopoly. Even if it cost s couple pennies of eps (which I don't believe) why wouldn't they proceed?
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