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Nine analysts and top management from thirty-seven sector firms examine the Media & Entertainment sector in this special 199-page issue from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info389.htm

TWST: Alissa, how do you look at the broadcasters, and what, in your opinion, has been most striking about the performance of these stocks in the second half of 2000 and in 2001, year to date?

Ms. Grahm: I’ve divided my coverage into two segments. One is general market radio, and the other segment is Spanish language broadcasting — both radio and television. I selected these two segments because I think they are two of the faster growing segments within the media industries. The stock performance of the radio broadcasters in the second half of 2000, and really for the whole year, was disappointing. We had a number of things going on. Initially, there was the realization that a lot of the consolidation that had fueled the growth of the industry, which Jim alluded to, was behind us. While I think that there will continue to be consolidation among the second tier of radio broadcasters, that no longer was as big a catalyst for some of the larger players in the radio broadcasting segment. Second, it became painfully apparent toward the end of the second quarter last year that dot-com advertising was not here to stay. It was a very nice source of new customers and new revenue but, unfortunately, was not sustainable. Finally, we clearly had the slowing of the economy, which played a part in the second half of the year. I think all three of those things contributed to the poor stock performance in 2000.

TWST: Alissa, how do the valuations of the pure-play radio stocks look to you?

Ms. Grahm: I think as a group they look rich. The median public radio broadcaster is trading just under 25 times 2002 aftertax cash flow right now, which, as Jim mentioned earlier, is getting toward the upper range of where we’ve seen these stocks trade historically. I don’t necessarily think that the very highest valuations that we’ve seen in the past, more than 30 times, are rational in this environment, post the consolidation and dot-com frenzies. I’d say, generally, the sector looks rich, but I will point out that there are select companies within the industry that look much more attractive. One high quality name with, I think, little company-specific risk is Entercom Communications (NYSE:ETM), and it also has a reasonable valuation, given multiples in the radio sector.

TWST: Alissa, what’s your view of Entercom, at this point?

Ms. Grahm: I think Entercom is one of the best-positioned radio companies right now. They are a pure-play radio company. They’ve had the last year to integrate and improve a large group of stations that they bought at the end of 1999; they’re really not dealing with any of the integration issues that some of the other radio companies are facing. I think they’ve got a great management team; I think they’ve got good clusters of stations in good markets and their financial leverage is manageable. As I mentioned before, I think that they are likely acquirors, and potentially, at some point, they might be a company that another radio or media company would find attractive. Near term, I think they are valued attractively, relative to the rest of the radio sector, but I believe that the sector itself is a bit rich right now.

This special issue includes:

1) Broadcasting - TV & Radio - In an in-depth (10,600 words) Analyst Roundtable, James Goss, Vice President at Barrington Research Associates, Inc. and Alissa Grahm, Media Analyst at William Blair & Company, examine the outlook for the sector including, general market radio, regulatory outlook and share specific stock recommendations.

2) The TWST confidential Off-The-Record survey of management performance at nineteen sector firms asked market insiders about the ability of management teams to create shareholder value.

3) Media & Entertainment Stocks - In an in-depth (3,100 words) Analyst Interview, Edward Hatch, Head of Media & Entertainment Equity Research Group for SG Cowen Securities Corp., examines the outlook for the sector and shares specific stock recommendations.

4) Entertainment & Media Stocks - In an in-depth (6,500 words) Analyst Interview, David Miller, Media and Entertainment Analyst at Sutro & Co., Inc., examines the outlook for the sector and shares specific stock recommendations.

5) Newspaper Stocks - In an in-depth (3,300 words) Analyst Interview, Leland Westerfield, Director in the Communications Group of UBS Warburg Equity Research, examines the outlook for the sector and shares specific stock recommendations.

6) Internet Media Stocks - In an in-depth (3,600 words) Analyst Interview, Safa Rashtchy, Vice President of U.S. Bancorp Piper Jaffray, examines the outlook for the sector and shares specific stock recommendations.

7) Outlook for Media & Internet Media Stocks - In an in-depth (3,400 words) Analyst Interview, Jordan Rohan, Head of Media Research at Wit SoundView Corp., examines the outlook for the sector and shares specific stock recommendations.

8) Interactive Television & New Media Technologies - In an in-depth (5,100 words) Analyst Interview, Murray Arenson, Equity Research Analyst at Morgan Keegan & Company, examines the outlook for the sector and shares specific stock recommendations.

9) Interactive Technology - In an in-depth (4,100 words) Analyst Interview, David Lee Smith, Senior Analyst covering the media sector for Dain Rauscher Wessels, examines the outlook for the sector and shares specific stock recommendations.

10) CEO interviews (average 2,500 words). Top management of thirty-seven sector firms examine the outlook for their firm and the sector.