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Five analysts and top management from eighteen sector firms examine the publishing & information services sector in this special 109-page Publishing & Information Services issue from The Wall Street Transcript, available at (212/952-7433) or http://www.twst.com/info/info478.htm.

TWST: Mark, what’s the thinking at ABN Amro? What’s your view on where newspapers and magazines stand with respect to the rest of the media world?

Mr. Henderson: I’m in general agreement with Doug. Newspapers and magazines have definitely gotten hurt. Probably the only medium that has done worse has been online advertising, which we expect to be down almost 20% for 2001. We expect newspapers to be down 9% and magazines down 5%.

TWST: Mark, what happened to local advertising in 2001? Has that been hit as badly as national advertising?

Mr. Henderson: You know, local advertising has been down, but not to the extent of the decline in national. Local advertising is likely down 5%, whereas national is down 13% in 2001. That said, local makes up 46% of total revenue, while national accounts for only 15%. I would say local advertising has been relatively stable in small newspaper markets. Advertisers know that, even in the smaller markets, readers are going to newspapers as authoritative sources of news and analysis. In addition, retailers outside of the urban markets haven’t been hit as hard as those in the urban markets and have continued to advertise a little bit more.

TWST: Mark, The New York Times (NYSE:NYT), Dow Jones (NYSE:DJ), Gannet (NYSE:GCI), Tribune (NYSE:TRB) — how do these stocks look to you?

Mr. Henderson: If you’re as pessimistic on the advertising recovery as we are, then these stocks look fully valued. If you wait for a pullback when that pessimism is digested, that should be the time to buy.

TWST: Are they equally attractive when that time comes?

Mr. Henderson: Tribune and New York Times are more leveraged to a cyclical ad recovery than Gannett and some of the smaller newspapers, such as Journal Register. Scripps (NYSE:SSP) certainly has a stable of small to mid-sized markets in their newspapers.

TWST: Is it a question of timing, being ahead of that turn?

Mr. Henderson: I think it really is a question of timing. With fourth quarter earnings, management should begin to reflect the pessimism we’ve been talking about here. When that’s the case, investors may say, “Maybe that ad recovery isn’t as near as we thought. Let’s retrench and go into some more defensive names — maybe that’s the time to buy.” I think valuation is clearly an issue here. One of the factors that affects valuation is interest rates. The risk on interest rates is to the upside, not to more easing.

TWST: Are there any others that you would like to highlight, Mark?

Mr. Henderson: Scripps has always been very interesting to me because they’ve taken their publishing assets, which generate a ton of free cash, and invested in higher growth businesses: cable networks like Home & Garden Television and Food Network. That has been a very smart thing to do. Revenue and EBITDA at Scripps Networks have grown enormously, so the segment is taking center stage at a time when Scripps is ready to launch new networks and begin the cycle again. So I like Scripps for the fundamental growth in its businesses and for the way it manages its newspapers.

This special issue includes:

1) Publishing & Information Services - In an in-depth (11,400 words) Analyst Roundtable, Douglas M. Arthur, Principal at Morgan Stanley, Mark D. Henderson, Director at ABN AMRO, Inc. and Alan Szydlowski, Vice President of Equity Research Division at U.S. Trust Company, examines the outlook for the sector including pricing outlook, investor sentiment and shares specific stock recommendations.

2) Newspaper & Magazine Publishing - In an in-depth (7,100 words) Analyst Interview, Lauren Rich Fine, First Vice President at Merrill Lynch Global Securities, examine the outlook for the sector including and share specific stock recommendations.

3) Online Content Companies - In an in-depth (3,700 words) Analyst Interview, Paul J. Kim, Vice President of Equity Research at Kaufman Brothers, L.P., examine the outlook for the sector including and share specific stock recommendations.

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

5) CEO interviews (average 2,500 words). Top management of eighteen sector firms examine the outlook for their firm and the sector.