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They've kidnapped a model. She sits in front of an extremely high definition camera, which broadcasts to the full color electronic paper screen. On rainy days they chop lots of onions and tell her that her butt looks too big.
If it's anything like this Playboy billboard (boobies, NSFW), they just put up two layers of paper, and when the top layer gets wet, the 2nd layer shows through. Check the comments, where one of the guys who worked on the ad chimes in.