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California Considers Digital License Plates With Pop-Up Ads

Public-private partnership would give the state DMV green light to research benefits, address concerns and potentially help plug $19 billion budget hole.

California may become the first state to use advertising on citizens' vehicles to help pay its bills. Although the technical details, among others, still need to be nailed down, the Golden State is looking into ad-enabled digital license plates as a way to potentially drive down the state's $19 billion deficit.

The state Assembly is considering a bill that would allow the state Department of Motor Vehicles (DMV) to start researching the use of electronic license plates to generate money for the cash-strapped state.

"State governments are facing unprecedented budget shortfalls and are actively rethinking the use of existing state assets to create new ongoing revenue opportunities," the bill's author, Sen. Curren Price, Jr., said in a press release. Cost savings could be realized through streamlined distribution, activation and registration of license plates, and would help create local jobs. "Finally, having digital electronic license plate technology developed and engineered in California would create new jobs in technology, sales/marketing and service fields."

The digital plates would look and work like a computer screen that displays a reproduction of a license plate, with the ability to display ads when the vehicle is stopped for four seconds or longer, according to SB 1453. The state has already identified one company -- San Francisco-based Smart Plate -- that's in the development stages of producing such plates.

"Right now it's all very theoretical," said Howard Posner, Assembly Transportation Committee consultant who prepared an analysis of the bill. And it's confusing. The bill, if passed, would only offer the option for the DMV to research this technology in partnership with the private sector. And the DMV has yet to take a stance on the bill, or make any comments on it, according to a spokesman.

If it chooses to explore the use of digital plates, the DMV would be required to submit a report on its findings to the Legislature by Jan. 1, 2013. The private sector would foot the approximately $200,000 to complete the report, the bill states.

More than a Mobile Billboard

In addition to the plates' ability to display ads from companies that have entered into contracts with the DMV, they would also deliver emergency alerts, according to Price's office.

"Critical, real-time public safety information such as Amber alerts and emergency traffic updates can be broadcast to the plates during exigent circumstances," a press release from his office stated.

But California drivers wouldn't necessarily be required to turn their vehicles into mobile billboards. The digital plates would only be installed on vehicles whose owners have agreed to use them, and the owners could then choose which ads to display based on their preferences.

"It's not like you're going to be riding down the street and the DMV is going to decide to advertise McDonald's on your car," Posner said. And while the financial model is unclear, he said companies that want to advertise on license plates may offer rewards or financial incentives to the drivers who choose to carry their messages.

The digital plate would access ads from a "computing cloud" or another wireless network, as opposed to an in-vehicle or on-plate chip, the bill states. But as pointed out by Mark Bianchi, Smart Plate spokesman and company adviser, this technology is in its early stages of development.

Safety First

The state has already pointed out potential areas of concern and issues that should be addressed before such devices go out to the public.

"There are a lot of questions about how this would play out, and from our standpoint -- we're the transportation people -- we would want to

make sure it happens in a way that doesn't compromise public safety," Posner said.

Some questions and concerns include:

  • How would law enforcement identify a vehicle's ownership and status when the license plate is in advertising mode?
  • The driver's ability to disable the license plate identifying numbers and letters in an effort to avoid detection during the commission of a crime or while driving through a toll facility. 
  • The unintentional disabling of the plates' numbers and letters due to malfunction, accident or vandalism. 
  • Should an electronic plate, for some reason, remain in the advertising mode while the vehicle is in motion, it would create a safety hazard by distracting fellow motorists following it.
Some areas are already being addressed. For example, Bianchi said, the plates are being designed so that when a member of law enforcement is within a certain distance of a vehicle, its plate would be triggered to only show its license, temporarily disabling the ad feature.

Also noted in the bill is that due to a 2004 federal court decision, the state can't pick and choose to promote some organizations, while denying this right to others. Therefore, it's likely that the DMV would have to accept any "non-obscene messages" from any organization or company that wants to advertise itself through the plates, should they enter general use.

"While each of these issues can theoretically be addressed through technological means, those solutions are only as sound and reliable as the technology itself," according to the bill. "Finally, there is a generalized concern that in a society that is perceived by some to be vastly over-commercialized, this bill represents the breaching of yet another barrier between public and private functions."

The bill has so far received no formal opposition and has the support of sponsor Smart Plate. It passed unanimously through the Senate last month and is scheduled to be heard Monday, June 28, by the Assembly Transportation Committee.


Karen is a former staff writer for Government Technology magazine.