I wrote a blog article on the interactive kiosk and digital signage weblog about Tesco's digital signage deployment struggling, and apparently Brand Republic has some additional information for us about that:
[Chris O'Donnell, managing director of OneZeroOne, the digital division of outdoor specialist Kinetic] claims the first, and most fundamental problem, was that Tesco and JCDecaux treated the in-store screens as if they were a TV medium in their own right.
There was a propensity to encourage advertisers to use Tesco TV to run broadcast-style ads. These did not work because of the location of the screens, which are suspended from the ceiling. It has subsequently been shown that simpler advertising messages with static branding have proved more successful.
Additionally, the article cites other content-related problems as well as some culture issues between Tesco, media house JC Decaux, and the ad agencies selling the spots. They note that there have been some recent successes changing the way the space is sold, bundling the digital signage screen time with other traditional forms of in-store POP advertising.