Confidential and Proprietary T. C. Transitus Communications Inc.

Gross Rating Points for Moving Billboards for the Taxi Industry

Measurement

Gross Rating Points (GRP) for moving billboards on top of licensed taxi cabs can be measured as a function of a number of variables as shown in Table 1 below. For Transitus' innovative nine-sided sign, the MediaDome, GRP can be measured with a certain degree of accuracy for each pair of signs as follows, that is: Passenger and driver side panels; front and back panels; and each pair of diagonally place logo lites, as well as the top panel.

Table 1: GRP Variables

* Measure of peak hour traffic and traffic distribution

It is also necessary to reduce this set of variables to a single, easily understood function that closely approximates the behavior of the GRP. In essence, we attempt to measure GRP for each pair of sign panels as a function of the metropolitan population of an area.

GRP per pair of signs per cab per day is fundamental to delivering value to advertising partners. GRP will be higher in larger metropolitan areas where more pedestrians and vehicular traffic and multi-story buildings mean more pairs of eyeballs on advertisers' messages. Suggested pricing delivers exceptional value in each of market--delivering more value per thousand viewers than any other medium and with greater impact.

Base Case

For a metro population of 4,000,000, for a taxi travelling on a two-lane road, GRP per pair of signs can be expressed as follows:

GRP/pair of signs/cab/day = 24 hours/day X lane capacity X average number of persons/vehicle X number of lanes X load factor,

or

GRP = 24 hrs X 1,200 vehicles/hr/lane X 1.2 persons/vehicle X 2 lanes X 0.333 load factor

which yields:

GRP = 23,017 persons per day.

For a smaller metro market of 1,000,000 population:

GRP = 23,017 persons/day X avg. hours/day of taxi operation X number of days per week of taxi operation,

or

GRP = 23,017 persons/day X 16/24 hrs/day X 6/7 days per week,

or

GRP = 13,153 persons per day.

This calculation for a city of one million does not include an allowance for pedestrians, multi-lane highways and streets and viewership from multi-story buildings. Thus, we believe that MediaDomes can and do deliver a higher GRP figure than those shown.

For a large metro area with a population of nine million, we have:

GRP = 24 hrs./day X 1,200 vehicles/lane/day X 1.2 persons/vehicle X 3 lanes X 0.400load factor X 24/24 hrs per day X 7/7 days per week,

or

GRP = 41,472 persons per day.

Now we develop an equation for GRP as follows:

GRP = a + mP,

where:

a is a constant,

m is the slope, and

P is metro population measured in millions.

From the above data we obtain:

GRP = 9,613 + 3,540P, 0.5M < P < 18M

This measurement of GRP, in viewers per pair of signs per cab per day, is valid for metro areas with a population of from 500,000 to 18,000,000 persons. Above that figure, GRP is likely to level off as congestion increases and limits to both vehicular and pedestrian traffic densities are reached. Application of this equation provides the GRP estimates presented in Table 2.

Table 2: GRP* per Pair of Signs per Cab per Day

as a Function of Metro Population Metropolitan

*GRP: Number of persons viewing each pair of MediaDome message panels per cab per day.

Value

MediaDomes provide exceptional value per 1,000 hits (viewers) as shown below in Table 3.

Table 3: Cost Per Thousand Viewers (CPM)

*US$ per cab per pair of side panels per day (suggested pricing of $150 monthly per pair ÷ 30.4 days/average month)

MediaDomes deliver exceptionally low cost per thousand viewers with a qualitative advantage based on superior graphics, superior demographics and greater and more sustained viewership. Compare the cost per thousand delivered by MediaDomes with major media as shown in Table 4. The MediaDome cost advantage is substantial and makes investment in the product doubly worthwhile. In fact, combining lower costs and qualitative advantages (see below) with the low cost of producing the creative ads when compared with the cost of producing, for example, billboard signs, television commercials or bus ads, the MediaDome really stands out from the crowd.

Reasonableness Test

In a metropolitan area of one million persons, a typical two-sided stationary billboard will rent for from $3,000 to $3,500 monthly and up, or about $100 to $115 per side per day for a two way traffic count of from 12,000 to 14,000 vehicles per day. Each side is seen by half the traffic which means that we obtain a cost per thousand viewers as follows:

$3,500 per side per month ÷ 30.4 days/month ÷ (7,000 vehicles per day viewing each side X 1.2 persons per vehicle) ÷ 1,000 (for cost per thousand),

or

$13.71 per thousand for a billboard sign.

If a cab is parked next to this billboard, each pair of sides would be seen by 14,000 vehicles per day. Thus, for two side panels at $150 monthly, we would obtain a cost per thousand as shown below:

Table 4: Cost Comparison of Advertising Media

Cost per Thousand Viewers (US$)

Notes:

1. Estimated as follows:

Population Cost per month per side Vehicles per day Persons per vehicle

1,000,000 $3,500 7,000 1.2

3,000,000 $12,000 18,000 1.2

9,000,000 $18,000 24,000 1.2

18,000,000 $22,000 26,000 1.2

2. $18,000 per page, 800,000 readers with pass along readership of 1.5.

3. $70,000 per page, 2.5 million readers, pass along readership of 2.0.

4. 12 cents per piece

5. The Bus Board CPMs have been calculated using the Gamma-Poisson method which is a different method from what was used for the other media. They are based on peak-hour traffic only since 85% of transit buses are not on the road in off-peak hours. In practice, there would be a small percentage of additional viewers in off-peak hours which would reduce this calculated rate, but without sign lighting, day-time only operation should be included. $150 per pair of sides per month ÷ 30.4 days/month ÷ (14,000 vehicles per day X 1.2 persons/vehicle) ÷ 1,000, or 29.3¢ per thousand viewers for the MediaDome.

It costs approximately 12¢ to send one piece of junk mail through the post office. To reach a thousand viewers, it would cost $120 and that assumes that each householder actually looks at his or her junk mail.

Clearly, the MediaDome delivers great value.

Qualitative Differences

Taxi cabs and MediaDomes in particular, deliver more value than the numbers alone suggest, although the numbers are terrific too. Taxi cabs, unlike bus advertising or stationary billboards or other forms of advertising, yield a number of advantages including:

1. They travel on non-fixed routes and, typically, 24 hours per day, seven days per week.

2. Busses tend to operate Monday to Friday and during peak times only--the remainder of the day they tend to park (unseen) in city depots far from the pulse of city life.

3. Taxis, even when parked at taxi stands and ranks, tend to be where the action is and where they can be seen.

4. Transitus' MediaDome is lighted so its visibility actually increases still further after dark--bus signs are essentially invisible after nightfall.

5. The MediaDome and advertisers' messages are seen up close by passing vehicles, trailing vehicles and pedestrians unlike billboards which can be far removed.

6. Our self-adhesive, full-color vinyl ads are UV protected and do not fade giving the advertiser fully consistent results throughout the campaign.

7. The creative is also not affected by car washes meaning that the advertising partners' products look good all the time.

8. Since the creative is inexpensive to reproduce and install, the advertiser can change the campaign often and keep the message fresh.

9. MediaDome advertising gives much greater value per thousand viewers in absolute dollar terms than any other media and it also delivers qualitative advantages such as--client messages can not be zapped by a television remote control.

10. The MediaDome product is new and its elegant, innovative, patented design delivers a powerful message that will get noticed.

11. National and local advertisers will now have a new channel to reach a narrow or wide, upscale audience--taxis tend to travel in all parts of a metropolitan area but they also tend to concentrate more in areas that deliver superior demographics.

12. Each viewing of the MediaDome can last a long time--there is a captive audience on clogged city streets and congested freeways.

Conclusion

With a new, innovative product which is highly visible day and night, MediaDomes deliver value, name recognition and better product retention with the public. Together with the ability to deliver Public Service Announcements such as 'Don't Drink and Drive' or ' Missing Kids' and by improving the economics of the whole taxi industry for the benefit of cab owners, drivers, unions and companies, as well as improving driver safety, MediaDomes are a good strategic investment.

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