San Jose touts digital billboards as revenue boost

Downtown San Jose's most recognizable landmarks could soon be home to an array of digital billboards for the next 20 years.

The councilmembers approved new contracts with digital billboard advertising company Orange Barrel Media on Tuesday. The city would receive 15% of the advertising time and Orange Barrel Media would be responsible for upkeep and operational costs. The billboards are projected to bring San Jose tens of millions of dollars, but an opposing group of residents say the potential benefits aren't worth the visual blight and reputational damage to downtown. If approved, illumination of the signs would be prohibited between midnight and 6 a.m.

San Jose economic development officials said the minimum guaranteed revenue generated from the city's deal with Orange Barrel Media would be about $21 million over 20 years, while Orange Barrel Media told the city they project as much as $37 million in revenue.

The nearly 1,000 square-foot digital signs are set to be featured at the San Jose Center for the Performing Arts, McEnery Convention Center, the Market & San Pedro Street parking garage and the Second and San Carlos Street parking garage.

The installation of five signs, with two at the Center for Performing Arts, would be San Jose's most ambitious since elected officials voted to end the billboard ban in 2018 on city-owned land.

Jason Hemp, co-founder of the group No Digital Billboards in San Jose, said a 2021 study by the San Jose Planning Department showed more than 61% of respondents strongly opposed digital billboards, while only 2.5% were strongly in favor.

"We've brought these survey results up again and again in front of the city council, but it doesn't seem to be swaying anybody," Hemp told San Jose Spotlight. "They still seem to be clinging on to the revenue idea, especially in light of the budget shortfall with the city."

Orange Barrel Media senior development director Clay Collett said non-traditional ads in the downtown's core will include national advertisers, as well as local San Jose businesses, with the goal of adding vibrancy through digitally-integrated architecture.

"We believe our proposal for San Jose captures this spirit perfectly," he told San Jose Spotlight. "As part of our proposal for the Center for Performing Arts, we are installing new signage promoting the Center itself, and we are building new seating and shade elements for theatergoers."

Billboards on city-owned property will enhance the commercial vibrancy and artistic aesthetics of downtown, Economic Development and Cultural Affairs Director Nanci Klein and Planning Director Chris Burton wrote in a memo to the city.

"This (also) allows for real-time emergency notifications and city messaging to residents," they said.

Collett said nothing "offensive, lewd, obscene, illegal or profane" would ever appear on the billboards. The goal is to partner with San Jose and the local community to showcase its arts and all of the exciting events coming to the city.

While the proposed locations for digital signs initially included The Tech Interactive on Market Street, CEO and President Katrina Stevens said their existing lease agreement doesn't allow for digital billboards.

She said having a giant ad on the side of the building could undermine public trust in The Tech's scientific objectivity and ongoing sponsorships.

"With only 15% of the digital screen time reserved for (San Jose's) own content in the city's proposal, our promotional capacity would be heavily constrained, and we'd be competing for attention with unrelated, and potentially in-conflict, commercial advertising on our own building," Stevens told city officials ahead of Tuesday's meeting.

Les Levitt, co-founder of the group No Digital Billboards in San Jose, said he worries the ads controlled by an out-of-state company could undermine not only downtown landmarks, but local businesses as well.

"We're trying to attract people to downtown, and they (could be) advertising, 'Go out of town to Disneyland' and so on," he told San Jose Spotlight. "If putting digital billboards with national brand advertising all over San Jose is the city's idea of economic development, we're in a sad state."

Editor's note: This story was originally published by San Jose Spotlight.