Brandon Donnelly
Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly.
Brandon Donnelly
Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly.
This morning I saw this tweet about Toronto streetcar advertising. The author has a “big problem” with public transit being fully wrapped in ads and so she decided to tweet her local Councillor to see if these could be somehow limited in size.
My first thought was: I wonder how many people would accept higher fares in exchange for fewer/no advertising. Is this something people care about? Because personally, I’ll take the lower fares in exchange for someone trying to monetize my attention. I mean, every social network I use is already selling my attention off as their product.
But then this got me thinking about what the actual numbers look like. So let’s look at some of those for not only Toronto, but also for Hong Kong, since many people view that as the gold standard as far transit authorities go.
For the year ending December 31, 2016, the Toronto Transit Commission (TTC) posted a total operating revenue of $1.204 billion. This represents about 41% of total revenue – the rest comes from subsidies.
If you drill down into operating revenue, advertising makes up $28 million or about 2.33% of total operating revenue. So a pretty small number. If you tried to shift this number over to “passenger services” revenue (transit fares), it actually wouldn’t increase fares by that much. But presumably fares are already at some profit maximizing number.
Switching to Hong Kong’s MTR Corporation, their numbers have to be unpacked a little differently because the group has a number of diverse business lines, including property development.
For the year ending December 31, 2016, total revenue from Hong Kong Transport Operations was HK$17.655 billion (almost all fare revenue). Advertising falls within the Hong Kong Station Commercial Businesses group and that company posted revenues of HK$5.544 billion for the same time period.
To try and create some sort of comparison, I’m ignoring all of the other segments within MTR.
Within Station Commercial Businesses, advertising revenue alone makes up HK$1.09 billion or about 20% of that group’s total revenue. The rest comes from station retail rent (the biggest chunk), telecom, and some miscellaneous station income.
If you add up Transport Operations and Station Commercial Businesses, total revenue was HK$23,199 billion for the year ending 2016. Advertising comprises about 4.70% of this – so more than double that of Toronto.
It’s also worth noting that MTR’s station retail rental revenue is about 3.4x that of its advertising revenue. In the case of Toronto, the TTC actually makes more money off advertising than it does from “Property Rental.” I’ve always thought this was a missed opportunity. Transit and land use go hand in hand.
In any event, I’m far less fussed about advertising on transit. But what are your thoughts? Let me know in the comment section below.
I’m taking next week off so that I can respond to emails from various places in Ontario and Quebec instead of from my desk. The out of office messages really fly at this time of year, so it’s usually a pretty good time to try for a recharge.
Because of that, this post feels appropriate.
Sahil Chinoy of the Washington Post recently looked at anonymous cell phone and vehicle data (from Here Technologies) to see how far you could drive in one hour if you were trying to escape the downtown of various U.S. cities on a Friday afternoon in the summer.
This exercise was done for 3 departure times on July 28, 2017: 4pm, 7pm and 10pm. The mappings all leverage 3 years of historical speed data.
Here is a first set of maps showing a few cities in the northeast and in the mid-atlantic. Every city is shown at the same scale so that they can be easily compared.
This morning I saw this tweet about Toronto streetcar advertising. The author has a “big problem” with public transit being fully wrapped in ads and so she decided to tweet her local Councillor to see if these could be somehow limited in size.
My first thought was: I wonder how many people would accept higher fares in exchange for fewer/no advertising. Is this something people care about? Because personally, I’ll take the lower fares in exchange for someone trying to monetize my attention. I mean, every social network I use is already selling my attention off as their product.
But then this got me thinking about what the actual numbers look like. So let’s look at some of those for not only Toronto, but also for Hong Kong, since many people view that as the gold standard as far transit authorities go.
For the year ending December 31, 2016, the Toronto Transit Commission (TTC) posted a total operating revenue of $1.204 billion. This represents about 41% of total revenue – the rest comes from subsidies.
If you drill down into operating revenue, advertising makes up $28 million or about 2.33% of total operating revenue. So a pretty small number. If you tried to shift this number over to “passenger services” revenue (transit fares), it actually wouldn’t increase fares by that much. But presumably fares are already at some profit maximizing number.
Switching to Hong Kong’s MTR Corporation, their numbers have to be unpacked a little differently because the group has a number of diverse business lines, including property development.
For the year ending December 31, 2016, total revenue from Hong Kong Transport Operations was HK$17.655 billion (almost all fare revenue). Advertising falls within the Hong Kong Station Commercial Businesses group and that company posted revenues of HK$5.544 billion for the same time period.
To try and create some sort of comparison, I’m ignoring all of the other segments within MTR.
Within Station Commercial Businesses, advertising revenue alone makes up HK$1.09 billion or about 20% of that group’s total revenue. The rest comes from station retail rent (the biggest chunk), telecom, and some miscellaneous station income.
If you add up Transport Operations and Station Commercial Businesses, total revenue was HK$23,199 billion for the year ending 2016. Advertising comprises about 4.70% of this – so more than double that of Toronto.
It’s also worth noting that MTR’s station retail rental revenue is about 3.4x that of its advertising revenue. In the case of Toronto, the TTC actually makes more money off advertising than it does from “Property Rental.” I’ve always thought this was a missed opportunity. Transit and land use go hand in hand.
In any event, I’m far less fussed about advertising on transit. But what are your thoughts? Let me know in the comment section below.
I’m taking next week off so that I can respond to emails from various places in Ontario and Quebec instead of from my desk. The out of office messages really fly at this time of year, so it’s usually a pretty good time to try for a recharge.
Because of that, this post feels appropriate.
Sahil Chinoy of the Washington Post recently looked at anonymous cell phone and vehicle data (from Here Technologies) to see how far you could drive in one hour if you were trying to escape the downtown of various U.S. cities on a Friday afternoon in the summer.
This exercise was done for 3 departure times on July 28, 2017: 4pm, 7pm and 10pm. The mappings all leverage 3 years of historical speed data.
Here is a first set of maps showing a few cities in the northeast and in the mid-atlantic. Every city is shown at the same scale so that they can be easily compared.
And here is a second set of maps showing a few, more car-oriented, cities.
Not surprisingly, older transit-oriented cities like New York don’t do well in this contest. No matter what time you leave, it’s hard to make it past 30 miles. Whereas in the case of Vegas, it doesn’t really matter what time you leave. You should be able to clear 50 miles.
That’s the other interesting thing to note about these maps – the spread between distances at the various times.
I’m sharing these because I’m a sucker for diagrams, but I don’t think they tell the whole story. The modal splits and the population and employment densities are all very different across these cities. New York’s core competency is in moving lots of people in trains, not in cars.
Although, perhaps the ironic thing about these diagrams is that a tighter drive radius might actually say something about how efficiently land is being used.
The Economist recently published an article called: How and why road-pricing will happen. If you’re a regular reader, you’ll know that there’s been lots of talk and support over the years on this blog for dynamic road pricing.
It’s politically unpopular, but it’s an incredibly rationale way to deal with traffic congestion.
In Singapore – home of the world’s first congestion charge zone (1975) – they constantly monitor traffic congestion. As soon as average speeds drop over a three-month period, they simply raise the charge. Congestion gone.
We know this works, but for many reasons road pricing is highly divisive. According to The Economist, there are a few reasons why this is going to become a bit more politically palatable.
For one, the take from gas taxes and vehicle duties has been declining in Britain over the past couple of years. Electric vehicles will only exacerbate this trend. So governments are going to be forced to look elsewhere for money.
Secondly, traditional tolls and congestion charges are becoming increasingly ineffective. Today in central London, private-hire vehicles are said to make up about 38% of all car traffic – almost double the share of traditional black taxis.
These are cars circling around the city, picking up passengers. Blunt charges based on suburbanites entering the city in the morning and leaving in the afternoon is simply not capturing the way that many of us move around our cities today.
In other words, urban mobility is undergoing dramatic changes and the revenue and congestion management tools are going to need to adapt. If you’re interested in this topic, check out the full article here.
Photo by chuttersnap on Unsplash
And here is a second set of maps showing a few, more car-oriented, cities.
Not surprisingly, older transit-oriented cities like New York don’t do well in this contest. No matter what time you leave, it’s hard to make it past 30 miles. Whereas in the case of Vegas, it doesn’t really matter what time you leave. You should be able to clear 50 miles.
That’s the other interesting thing to note about these maps – the spread between distances at the various times.
I’m sharing these because I’m a sucker for diagrams, but I don’t think they tell the whole story. The modal splits and the population and employment densities are all very different across these cities. New York’s core competency is in moving lots of people in trains, not in cars.
Although, perhaps the ironic thing about these diagrams is that a tighter drive radius might actually say something about how efficiently land is being used.
The Economist recently published an article called: How and why road-pricing will happen. If you’re a regular reader, you’ll know that there’s been lots of talk and support over the years on this blog for dynamic road pricing.
It’s politically unpopular, but it’s an incredibly rationale way to deal with traffic congestion.
In Singapore – home of the world’s first congestion charge zone (1975) – they constantly monitor traffic congestion. As soon as average speeds drop over a three-month period, they simply raise the charge. Congestion gone.
We know this works, but for many reasons road pricing is highly divisive. According to The Economist, there are a few reasons why this is going to become a bit more politically palatable.
For one, the take from gas taxes and vehicle duties has been declining in Britain over the past couple of years. Electric vehicles will only exacerbate this trend. So governments are going to be forced to look elsewhere for money.
Secondly, traditional tolls and congestion charges are becoming increasingly ineffective. Today in central London, private-hire vehicles are said to make up about 38% of all car traffic – almost double the share of traditional black taxis.
These are cars circling around the city, picking up passengers. Blunt charges based on suburbanites entering the city in the morning and leaving in the afternoon is simply not capturing the way that many of us move around our cities today.
In other words, urban mobility is undergoing dramatic changes and the revenue and congestion management tools are going to need to adapt. If you’re interested in this topic, check out the full article here.
Photo by chuttersnap on Unsplash
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