As the MTA struggles to close an ever-widening budget gap, the authority is bent on maximize its revenue sources. If the agency, the argument goes, can find ways to tap out its self-generating revenue streams, the city and state might be more willing to help close the remaining gap. As laughable as the latter part of that line of reasoning sounds, the MTA is at a point where it cannot ignore potential money-making schemes.

Enter the argument for station naming rights. Last June, after being rebuffed by the Mets and Citi over a station naming rights deal in Queens, the MTA secured an annual payment from Barclays to append a corporate moniker to the Atlantic Ave./Pacific St. stop. The Barclays Center will one day rise above that busy Brooklyn station, and when the Nets’ new arena opens, the station will be called some permutation of Atlantic Ave./Pacific St./Barclays Center. Whether the corporate name will come first remains to be seen, but the MTA will enjoy 20 annual payments of $200,000 for these rights.

For the MTA, these naming rights deals are forging new ground, and the authority hasn’t formalized publicly how the station names will be structured. Straphangers need the geographic indicators that now mark stations throughout the system, but beyond that, does anything go? Perhaps the MTA could take a cue from the Chicago Transit Authority. In the Windy City, the CTA is in straits as dire as our own MTA, and the agency, as The Sun-Times recently reported, is looking to pursue an aggressive naming rights sales pitch.

Mary Wisniewski spoke to Philip A. Pagano, the head of the CTA, about the naming rights deals. “There may be a real interest by businesses located along our stations to get advertising,” Pagano said. The example he gave was of a nearby hospital. Perhaps that institution would pay for the station name. What sticks out, though, is Pagano’s insistence that every station would retain its so-called traditional name to go along with the sponsor’s branding. In New York, then, for instance, 34th St./Herald Square — already a freely branded station even if that brand is defunct — could become 34th St./Herald Square/Macy’s.

It seems nearly inevitable that transit agencies will resort to station names and that traditionalists will bemoan the corruption of, well, tradition. On the one hand, it’s jarring to hear and see something along the lines of Times Square/42nd St./Disney. On the other, since Day 1, the part of the subway not devoted to travel has always been about advertising. In fact, August Belmont’s original contract for the operation of the IRT lines allowed advertising as long as it didn’t interfere with “easy identification of the stations.”

The only drawback though is the amount of money the MTA could realistically expect to see from these naming rights deals. The Atlantic/Pacific stop is the 29th most popular one in the system, and for that, the agency drew in just $200,000 a year, chump change in the face of an $800 million budget deficit. As much as I believe naming rights to be an inevitable evil, I have to wonder if it’s worth it for such a pittance. Sometimes, tradition deserves to win.

Titan Outdoor Holdings oversees ad space on the city’s buses and commuter rail trains. (Photo via Titan Outdoor)

As the MTA looks for ways to shore up its leaking budget, the agency is going to have to pursue every available revenue avenue. From service cuts to the unthinkable fare hike, nothing is off the table, and that includes milking every last dollar out of its available advertising surface. What happens, though, if the companies contracted to manage and sell the authority’s ad space can’t pay up?

Today, the Daily News asks just that question in highlighting an internal audit that shows how one of the MTA’s advertising contractors owes the authority $18 million. Titan Outdoor Holdings, the company that sells ad space on city buses and the MTA’s commuter rail system, has not been fulfilling its contractual obligations to the MTA. Pete Donohue has more:

Titan Outdoor Holdings has stiffed the MTA out of about $18 million, coming in short with its monthly payments for nearly a year and engaging in some questionable accounting, an internal Metropolitan Transportation Authority audit revealed. The MTA could recoup the money by cashing a multimillion-dollar letter of credit Titan posted. But officials fear the move would bankrupt the company – meaning even less ad revenue for the authority, according to the audit. “We’re exploring all of our options,” MTA spokesman Jeremy Soffin said.

Titan sells and manages ad space in buses and commuter trains. To win the decade-long contract, Titan promised the MTA 72% of gross revenues – the highest in the industry – or $5.4million a month, whichever is greater. Meeting the high bar wasn’t a problem in 2007 – when the contract started – and 2008 but apparently became tougher early last year as companies trying to survive the recession cut back on advertising. Since February 2009, Titan has paid the MTA about $4 million a month, about $1.4 million short of its monthly minimum, the audit states.

According to the audit, Titan has not been forthcoming with its revenue statements and has been filing some financial reports 18 months late. Yet, as Donohue points out, the MTA is not ready to cut ties with Titan. The agency may lower the required monthly payment, but authority officials do not believe they can secure as good a rate as 72 percent from any other media sales company right now.

As Donohue notes in his article, the money owed to the MTA by Titan would be enough to cover the estimated $17.5 million in subway service cuts the agency plans to initiate later this spring. That is, however, something of a false dichotomy because the MTA has to balance its need for this revenue now against the long-term financial health of its advertising partners. Pushing Titan toward bankruptcy by cashing the letter of credit would solve one problem and create another. Still, with money tight, the authority will be looking to draw in as much revenue as it can and as it should.

Check out this video from City Harvest. As part of their efforts at reminding New Yorkers not to waste food during the holiday season, they loaded up a subway car full of apples and filmed it arriving at the shuttle platform at Grand Central.

Well, not really. The apples are computer-generated, but the ad, shot entirely on an iPhone camera, looks pretty slick. It certainly gets the point across. Draftcb, the agency behind this subway-themed public service announcement, put out a video showing how they put this one together. Watch it after the jump.

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Let’s talk for a minute about God. Or maybe I should say: Let’s talk for a minute about those who don’t believe God, a god, any gods exist. Now, I’m not going to get all religious on you, but a recent advertisement in the subways has raised the ire of, well, anyone religious who does not respond well to people with beliefs that may differ from their own.

The brouhaha over the ad at right started last week when Jennifer 8. Lee of The Times first reported on the impending atheist ads. An anonymous donor paid the $25,000 in order for the Big Apple Coalition of Reason to place this pro-atheism ad in 12 subway stations systemwide for one month. Deemed the cheapest advertising solution — a subway car costs $70,000 for a month and Times Square billboards go for $45-$50,000 — the ad will appear at the three 14th St. stations on the West Side; 23rd St. on the 8th Ave. line; Penn Station in three locations; 86th and 96th Sts. on Lexington; 42nd St. at Bryant Park; Lincoln Center, 72nd and 86th Sts. along Central Park West; and W. 4th St.

Of course, whenever religion is involved, people tend to grow a little hot under the collar. Jason Fink of amNew York tracked down some disgruntled straphangers. “I teach my children to believe in God and lead a life faithful to Him,” Aime Roberts of the Bronx said of the ads. “If my children see these ads that say there is no God, they’ll think their mother is lying.”

Another woman — obviously ill-informed of the Constitution — used the ad to bash the MTA. “The MTA can just do whatever it wants and get away with it,” Charlene McNair-Lawery of Brooklyn said to Fink. Of course, since the MTA is a government entity, freedom of religions and various sundry First Amendment concerns practically guarantee that this ad will appear, and an agency spokesman said that only nudity and vulgar language are prohibited in advertisements shown on MTA property.

The real fun began when Sean Hannity jumped into the fray. In one clip, the Fox News commentator posed a question, “Can you imagine the outrage if a Christian group put pro-God ads in the New York City subways? What outrage.” But as Subway Sights noted, Christians have been plastering the 41st St. walkway at Times Square with pro-Christianity placards for years, and other religious-themed materials abound underground.

So 400 words into this post, where does that leave us? With a big to do about nothing. The MTA has to place the ad, and for $25,000, they certainly will. Meanwhile, I have to wonder if subway advertising is really this insidious. Do we look at the ads we see every day? Clyde Haberman accused the Train of Thought program of being too gloomy last week, but outside of MTA PSAs and Doctor Zizmor, can anyone name something hawked in the subway?

For most of us, the subway is a chance to escape. We read our books; we do our crossword puzzles; we zone out to music on our iPods. If someone wants to preach, go for it. It’s nothing we haven’t heard before, and most of us won’t even notice it’s there anyway.

A Shuttle train sits at Grand Central, decked out in Google Maps advertising. (Photo by flickr user Paolo Mastrangelo)

Around the country, advertising revenues are dropping precipitously. From traditional bastions of print media to online news outlets, any business dependent upon advertising is feeling the crunch. The MTA is no exception.

As revenue goes, advertising isn’t really a key source of money for transit systems. In total, according to the Federal Transit Administration numbers, transit agencies drew in $334 million in revenue in 2007. That total makes up around one percent of nationwide transit revenue. Closer to home, the MTA reported over $100 million in revenue in each of the last two years.

Not this year, says William Neuman. According to The Times scribe, the agency is seeing lower-than-projected revenue from advertising due to missed minimum payments by Titan Worldwide. The advertising agency is tasked with selling ad space on buses and subways and in stations and owes the MTA around $7.5 million for a three-month period ending in April. Neuman reports:

The company, Titan Worldwide, fell short a total of $7.5 million in mandatory payments to the Metropolitan Transportation Authority from February through April, citing lower than expected ad sales. That would be enough to buy 16 new buses for the authority, which recently received a state bailout in the face of multibillion-dollar budget deficits over the next few years.

“This is another example of the M.T.A.’s exposure to the global economic recession,” said Aaron Donovan, a spokesman for the authority, which plans to raise fares and tolls by about 10 percent in June…

Another company, CBS Outdoor, sells ads in the subway system, and it fulfilled its contractual requirement of making a $55 million lump-sum payment to the authority in January for all of 2009.

Neuman’s article is chock full of interesting information about subway and bus advertising. For example, an ad on the outside of a Manhattan-based bus sells for $1500 a month this year. In 2008, the MTA could command $1800 for the same ad.

On the business side, overall sales for CBS Outdoors, another MTA advertising partner, are strong due to the new ad spots on the outside of train cars. Titan, on the other hand, still owes the agency money from last year, and the agency may have to renegotiate its deal with the MTA to avoid incurring crippling penalties and payments.

“We’re trying to work with them to find a way to keep this contract in place,” Donovan said to The Times. “Our goal is to work it out and minimize the impact on the M.T.A.’s bottom line.”

Neuman also notes that Titan’s original bid for the 10-year contract with the MTA was for $103 million more in minimum guaranteed payments than the next highest bidder. William Apfelbaum, the company’s chairman, said that the difference in minimum payments would not impact his company were the economy strong.

In the end, the MTA isn’t really relying on advertising revenue for a significant portion of its budget, but the story remains the same: A public transportation agency should not have to attempt to squeeze every last dollar out of advertising just to stay afloat. We applaud the MTA for looking at new ways to draw in revenue through advertising, but as long as that money is icing on the cake and not a key part to the budget, we would have nothing to fear.

Generally, it costs around $20 to get into the Museum of Modern Art, but starting today and continuing on through the middle of March, savvy straphangers can visit replicas of MoMA’s most famous works for the cost of a MetroCard swipe.

As part of a rather ambitious advertising campaign, Brooklyn’s Atlantic Ave.-Pacific St. subway stop will host a full-station takeover by MoMA. The columns and turnstile arms will be adorned with museum logos, and the walls will feature true-to-life replicas of some of the museum’s iconic images. Art buffs can even download station-centric audio tours or call in to hear the guide from the nearest working payphone.

Randy Kennedy of The Times has more on what the MTA is calling a groundbreaking “station domination“:

The Metropolitan Transportation Authority and its advertising contractors routinely review the content of subway ads, keeping their eyes out for things that are too racy or rude. But they have never had an ad quite like one that came their way recently: an image of five naked women (probably prostitutes) vamping it up and staring down the viewer.

The fact that the frontal nudity is fully Cubist and was painted by Picasso more than a century ago undoubtedly made the decision a lot easier. And so on Monday, a glossy reproduction of that artwork, “Les Demoiselles d’Avignon,” took its place underground in the Atlantic Avenue and Pacific Street subway stations in Brooklyn, with copies of 57 other works from the Museum of Modern Art that will briefly transform the cavernous stations into a kunsthalle.

The museum’s publicity campaign, one of the most ambitious it has ever undertaken in the city, will cover every ad space in the two connected stations, spaces normally given over to plugs for movies, beer and podiatry treatments. In their place will be reproductions of works drawn from all parts of the museum, both well-known and more contemporary, by artists like Matisse, Hopper, O’Keeffe, Marlene Dumas, Cindy Sherman and Martin Kippenberger.

“We’ve never done a large-scale ad campaign for New Yorkers focused just on the permanent collection,” said Kim Mitchell, the museum’s chief communications officer. She said the idea had grown out of a new marketing advisory committee’s feeling — confirmed by focus groups — that many New Yorkers view the museum as a tourist-saturated place that is no longer quite as welcoming to natives.

Unfortunately, Kennedy doesn’t have a cost figure for this campaign. I’d be quite curious to find out how much the MTA is raking in from this promo.

Around the Web, some anticipation is building for the noon opening of this subterranean makeshift gallery. The Gowanus Lounge seems intrigued by what it called a bizarre preview. A Flickr set of the installation in progress offers up some tantalizing glimpses of a fun event — including a well-placed version of Piet Mondrian’s Broadway Boogie Woogie right above the Broadway line train.

I, along with over 49,999 of my closest friends, pass through that station at least twice a day. I’ll have to take a few minutes and hop off the train once to check out this museum, and, hey, at least I’ll get to save $18 over the cost of a MoMA admissions ticket.

One of the less endearing aspects of the fancy new subway cars that continue to take over the system is the automated public address announcements. At some point, we just don’t need to be told, at a volume far louder than necessary, that the MTA is ready to “apologize for the unavoidable delay.” In an ideal world, we wouldn’t be bombarded with “an important message from the NYPD” every five minutes either. But if one group has its way, we may soon be hearing advertisements over the subway loud speaker.

Over the last few months, as the MTA has tried to raise revenue from every available source, the agency has started to sell open space. They have sold the windows, the turnstiles and the outside walls of entire subway cars. Now, PETA, of all groups, is calling upon the MTA to sell airtime over the subway’s public address system as well.

PETA, in fact, has this all planned out, as their press release notes. They want to inaugurate something that would infuriate subway riders with a group of pro-vegetarian ads. Says the release:

Given the Metropolitan Transit Authority’s (MTA) announcement that it will be increasing fares and cutting services to help meet its 2009 budget, PETA has contacted the MTA with a suggestion. PETA has offered to kick off the first-ever paid advertisements to be heard over bus and train public-address systems. PETA’s ads would feature the voices of pro-vegetarian advocates Casey Affleck, Kevin Nealon, and Forest Whitaker…

PETA points out that encouraging commuters to adopt a vegetarian diet would help them address their own financial woes, too, since vegetarians slash not only their grocery bills but also their risk of developing heart disease, stroke, diabetes, and certain types of cancer–not to mention the high medical bills that come with treating these conditions.

“Broadcasting PETA’s ad on public transport could help the MTA’s bottom line and save passengers’ and animals’ lives,” says PETA Executive Vice President Tracy Reiman. “Commuters have a lot on their minds, and our ads will liven things up and give them something positive to think about.”

To hear the ads that hopefully won’t be appearing in the subways, head on over to PETA’s blog.

I have to applaud the pro-animal group for its ingenuity and effort here. They recognized a situation they could exploit and became, as far as I could tell, the first group to propose in-system audio ads. But New Yorkers would absolutely positively hate these intrusive advertisements.

To most of us, the subway ride is a means to end. We’re trying to get somewhere else in the city, and we do so under less-than-ideal conditions. Can you imagine how a packed car would respond to a 30-second anti-carnivore ad blaring over the loud speaker at 9:15 a.m.? I can, and it’s not a pleasant image.

Hopefully this will be one advertising idea the MTA doesn’t adopt in its efforts to raise funds. I’d take the East River bridge tolls any day over in-system audio ads.

“All infographics should have googly eyes” by flickr user arimoore.