marci l. ryvicker, cpa, cfa new york, new york september 16, 2010 please see page 26 for rating...

Marci L. Ryvicker, CPA, CFA

New York, New York

September 16, 2010

Please see page 26 for rating definitions, important disclosures and required analyst certifications.

Wells Fargo Securities, LLC does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of the report and investors should consider this report as only a single factor in making their investment decision.

A Look Forward At The Media Landscape

22

H1 Broadcast Television Trends

Revenue at the stations was +20%

Source: Company data, TvB and Wells Fargo Securities, LLC

Scatter pricing is + double digits

Auto ad spend was +50%

Network upfront was +8%

33

Is The Glass Half Empty…

TOTAL TV ADVERTISING IS DOWN $8 BILLION SINCE PEAKING IN ‘06

Source: MAGNA, NAA, U.S. Postal Service, Census Bureau, Public Filings, IAB, OAAA, RAB, TVB, and Wells Fargo Securities, LLC estimates

Total TV Advertising (in billions)

$48.4

$40.4

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

2006 2009

4

Or Is It Half Full…

TOTAL TV ADVERTISING SHOULD RECOVER ~50% OF THE LOSS IN ‘10


$40.4$44.2

$48.4

$0.0

$10.0

$20.0

$30.0

$40.0

$50.0

$60.0

2009 2010E ???

Total TV Advertising (in billions)

55

Strong Network Upfront

Source: SNL Kagan, company data and Wells Fargo Securities, LLC

Big Four Network Trends

$8.2 $8.2 $8.2$9.0

$8.3$8.9

$7.2

$8.2

5%

7%

3%

0%

7%8%

(4% )

8%

$0

$2

$4

$6

$8

$10

'03

- '0

4

'04

- '0

5

'05

- '0

6

'06

- '0

7

'07

- '0

8

'08

- '0

9

'09

- '1

0

'10

- '1

1

Tota

l B

ig 4

Netw

ork

Dollars

(i

n b

illions)

(8% )

(4% )

0%

4%

8%

12%

CP

M G

row

th

Writer’s Strike

66

Strong Network Upfront

Source: Company data and Wells Fargo Securities, LLC

2009-2010 Network Upfront Results

Network $ Amount (B) CPM Growth Sell-Out %

ABC $2.20 9% 80%

CBS $2.50 10% 80%

FOX $1.85 9% 80%

NBC $1.60 7% 80%

77

Advertising and the Economy

Source: Wells Fargo Securities, LLC estimates

Using our GDP regressions, we determined how advertising would react in 4 different scenarios:

• Scenario 1 – 4% GDP Growth



• Scenario 4 – (1%) GDP Growth or Double Dip

Scenario 1 Scenario 2 Scenario 3 Double DipGDP 4.0% 2.0% 1.0% (1.0% ) Advertising 2.6% (0.6% ) (2.2% ) (5.4% )

-10%

-5%

0%

5%

10%

15%

20%

-1% 4% 9% 14%

88

Advertising And The Economy

Source: MAGNA, NAA, U.S. Postal Service, Census Bureau, Public Filings, IAB, OAAA, RAB, TVB, U.S Dept of Commerce: BEA, Wells Fargo Securities, LLC

y = 1.5972x - 0.0376R2 = 0.5484R = 0.74054

Advertising & GDP are highly correlated, at 74%

99

Local Media and the Economy

Source: Wells Fargo Securities, LLC estimates

Scenario 1 Scenario 2 Scenario 3 Double Dip

GDP 4.0% 2.0% 1.0% (1.0% )

Advertising 2.6% (0.6% ) (2.2% ) (5.4% )

Outdoor 5.8% 2.9% 1.3% (1.9% )

Radio 2.0% (2.6% ) (4.2% ) (7.4% )

Spot TV (3.2% ) (8.6% ) (9.6% ) (11.6% )

Total TV 0.2% (1.6% ) (3.2% ) (6.4% )

1010

Broadcast Television Takes Share


Broadcast TV GAINED share during the recession

21.7%

20.9%

22.0%22.4%

23.6%

19%

20%

21%

22%

23%

24%

25%

2006 2007 2008 2009 2010E

1111Source: MAGNA, NAA, U.S. Postal Service, Census Bureau, Public Filings, IAB, OAAA, RAB, TVB, and Wells Fargo Securities, LLC estimates

Broadcast Television Takes Share

21.8% 21.7%20.9%

22.0% 22.4%23.6%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

2005 2006 2007 2008 2009 2010E

Newspapers Broadcast TV Radio Outdoor Internet

Broadcast TV & internet GAIN while newspapers LOSE

1212Source: Wells Fargo Securities, LLC estimates

Opportunities: Revenue Streams Today

Revenue Stream % Of Revenue

Retransmission Consent 5% - 10%

Spectrum (Mobile/ Digital) 0% - 5%

Internet 5% - 10%

Core Advertising 75% - 85%

1313Source: SNL Kagan and Wells Fargo Securities, LLC estimates

Opportunities: Retransmission Consent

We estimate that retrans will grow 25% per yr, on avg

$4,556

$2,278

$762$500$314

10.0%

5.0%

1.9%1.1%

0.7%$0

$1,000

$2,000

$3,000

$4,000

$5,000

2007A 2008A 2009A 2012E 2017E

Revenue in M

illions

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Perc

ent

of

Industr

y

1414Source: Wells Fargo Securities, LLC

Opportunities: Spectrum

Mobile Video – OMVC/Pearl

Lease Spectrum

Multicasting

National Broadband Plan

1515Source: Company website and Wells Fargo Securities, LLC

Opportunities: InternetFisher Communications Inc.

1616

Unemployment

Retail SalesAutoHousing

Consumer ConfidenceInflationGDP

What We Track….

Forecasting Advertising Trends

1717

Auto Vehicle Sales v. Auto Advertising

Source: BEA, TVB, CAB, RAB, OAAA, NAA, MPA, and Wells Fargo Securities, LLC estimates

16.5 16.1

13.2

10.411.5

$15.1$13.9

$11.7

$9.3$10.5

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

2006A 2007A 2008A 2009A 2010E

New

Vehic

le S

ale

s (

M)

$0.0

$2.0

$4.0

$6.0

$8.0

$10.0

$12.0

$14.0

$16.0

Tota

l Auto

Ad $

s (B

)

Auto advertising has a strong relationship with vehicle sales

1818

Auto Vehicle Sales and Television Advertising

Source: BEA, TVB, CAB, RAB, OAAA, NAA, MPA, and Wells Fargo Securities, LLC estimates

16.5 16.1

13.2

10.411.5

$7.4

$6.7

$5.9

$4.4

$5.0

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

2006A 2007A 2008A 2009A 2010E

New

Vehic

le S

ale

s (

M)

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0

$6.0

$7.0

$8.0

Tota

l TV

Auto

Ad $

s (B

)

Auto advertising on TV has a strong relationship with vehicle sales

(20% )

(15% )

(10% )

(5% )

0%

5%

10%

(10% ) (5% ) 0% 5% 10%

1919

Retail Sales and Total Advertising

Source: BEA, MAGNA, NAA, U.S. Postal Service, Census Bureau, Public Filings, IAB, OAAA, RAB, TVB, and Wells Fargo Securities, LLC estimates

Advertising & retail sales are highly correlated, at 94%

y = 1.3797x - 0.0621R2 = 0.8786R = 0.9373

202020

SS Sales Growth and Total Advertising

(10% )

(8% )

(6% )

(4% )

(2% )

0%

2%

4%

6%

8%

Q2

'07

Q3

'07

Q4

'07

Q1

'08

Q2

'08

Q3

'08

Q4

'08

Q1

'09

Q2

'09

Q3

'09

Q4

'09

Q1

'10

Sam

e S

tore

Sale

s

(20% )

(15% )

(10% )

(5% )

0%

5%

10%

15%

Tota

l Advertis

ing


(25% )

(20% )

(15% )

(10% )

(5% )

0%

5%

10%

15%

(10% ) (5% ) 0% 5% 10%

2121

Retail Sales And Television Advertising

y = 1.3718x - 0.0509R2 = 0.7032R = 0.8386


TV Advertising & retail sales are highly correlated, at 84%

222222

SS Sales Growth and Television Advertising

(10% )

(8% )

(6% )

(4% )

(2% )

0%

2%

4%

6%

8%

Q2

'07

Q3

'07

Q4

'07

Q1

'08

Q2

'08

Q3

'08

Q4

'08

Q1

'09

Q2

'09

Q3

'09

Q4

'09

Q1

'10

Sam

e S

tore

Sale

s

(25% )

(20% )

(15% )

(10% )

(5% )

0%

5%

10%

15%

20%

Bro

adcast T

V


23232323

Appointment Viewing

DVR, PPV, VOD

Netflix, Amazon, Red Box

CBS.com, ABC.com, etc.

Hulu, YouTube

Internet-Ready TVs

Apple TV, TiVo, Boxee, Sezmi, VUDU

2424

Advertising Growth By Medium - Historical

Source: MAGNA, NAA, U.S. Postal Service, Census Bureau, Public Filings, IAB, OAAA, RAB, TVB, and Wells Fargo Securities, LLC

2006 2007 2008 2009

Broadcast TV 5% (4% ) (0% ) (13% )

Total U.S. Advertising 5% 0% (5% ) (14% )

Cable TV 4% 7% 2% (3% ) Radio 1% (2% ) (9% ) (18% ) Outdoor 8% 8% (5% ) (16% ) Newspapers (0% ) (8% ) (17% ) (27% )

2525

Advertising Growth By Medium - Forecasts


2010E 2011E

Broadcast TV 10% 0%

Total U.S. Advertising 4% 2%

Cable TV 8% 8%Radio 8% 2%Outdoor 4% 6%Newspapers (7% ) (5% )

26

Questions?

26

Marci Ryvicker, CFA, CPA

Wells Fargo Securities, LLC

[email protected]

212-214-5010

27

Disclosures

27

To view price charts for all companies rated in this document, please go to https://www.wellsfargo.com/research or write to 7 Saint Paul Street, 1st Floor, R1230-011, Baltimore, MD 21202

ATTN: Research Publications Additional Information Available Upon Request

I certify that:1) All views expressed in this research report accurately reflect my personal views about any and all of the subject securities or issuers discussed; and 2) No part of my compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by me in this research report.

Wells Fargo Securities, LLC maintains a market in the common stock of Cablevision Systems Corp., CBS Corporation, Clear Channel Outdoor Holdings, Inc., Comcast Corporation, DISH Network Corporation, Entercom Communications Corp., Gray Television, Inc., Lamar Advertising Company, LIN TV Corporation, Saga Communications, Inc., Sinclair Broadcast Group, Inc., The DIRECTV Group, Inc., Time Warner Cable Inc.Wells Fargo Securities, LLC or its affiliates managed or comanaged a public offering of securities for CBS Corporation, Comcast Corporation, Gray Television, Inc., Lamar Advertising Company, LIN TV Corporation, Time Warner Cable Inc. within the past 12 months.Wells Fargo Securities, LLC or its affiliates intends to seek or expects to receive compensation for investment banking services in the next three months from CBS Corporation, Comcast Corporation, DISH Network Corporation, Gray Television, Inc., LIN TV Corporation, Saga Communications, Inc., Sinclair Broadcast Group, Inc., The DIRECTV Group, Inc., Time Warner Cable Inc.Wells Fargo Securities, LLC or its affiliates received compensation for investment banking services from CBS Corporation, Comcast Corporation, Gray Television, Inc., Lamar Advertising Company, LIN TV Corporation, Time Warner Cable Inc. in the past 12 months.Wells Fargo Securities, LLC and/or its affiliates, have beneficial ownership of 1% or more of any class of the common stock of CBS Corporation, Clear Channel Outdoor Holdings, Inc., Sinclair Broadcast Group, Inc.CBS Corporation, Comcast Corporation, Gray Television, Inc., Lamar Advertising Company, LIN TV Corporation, Time Warner Cable Inc. currently is, or during the 12-month period preceding the date of distribution of the research report was, a client of Wells Fargo Securities, LLC. Wells Fargo Securities, LLC provided investment banking services to CBS Corporation, Comcast Corporation, Gray Television, Inc., Lamar Advertising Company, LIN TV Corporation, Time Warner Cable Inc.Cablevision Systems Corp., CBS Corporation, Clear Channel Outdoor Holdings, Inc., Comcast Corporation, Time Warner Cable Inc. currently is, or during the 12-month period preceding the date of distribution of the research report was, a client of Wells Fargo Securities, LLC. Wells Fargo Securities, LLC provided noninvestment banking securities-related services to Cablevision Systems Corp., CBS Corporation, Clear Channel Outdoor Holdings, Inc., Comcast Corporation, Time Warner Cable Inc.Gray Television, Inc., Lamar Advertising Company, Sinclair Broadcast Group, Inc. currently is, or during the 12-month period preceding the date of distribution of the research report was, a client of Wells Fargo Securities, LLC. Wells Fargo Securities, LLC provided nonsecurities services to Gray Television, Inc., Lamar Advertising Company, Sinclair Broadcast Group, Inc.Wells Fargo Securities, LLC received compensation for products or services other than investment banking services from Cablevision Systems Corp., CBS Corporation, Clear Channel Outdoor Holdings, Inc., Comcast Corporation, Gray Television, Inc., Lamar Advertising Company, Sinclair Broadcast Group, Inc., Time Warner Cable Inc. in the past 12 months.Wells Fargo Securities, LLC or its affiliates may have a significant financial interest in Cablevision Systems Corp., CBS Corporation, Clear Channel Outdoor Holdings, Inc., Comcast Corporation, DISH Network Corporation, Entercom Communications Corp., Gray Television, Inc., Lamar Advertising Company, LIN TV Corporation, Saga Communications, Inc., Sinclair Broadcast Group, Inc., The DIRECTV Group, Inc., Time Warner Cable Inc.

28

Disclosures

28

CBS: Risks include a deeper and longer recession and a slower ad recovery than is currently anticipated.CCO: Risks include a slower-than-expected economic recovery and a potential CCMO bankruptcy (long-term).CMCSA: Risks to achieving this range include price declines due to competition in the pay-TV market and unexpected concessions associated with the NBCU deal.CVC: Risks to achieving this range include greater sub losses than expected and a slowdown in the SME segment.DISH: Risks include an unpredictable response to the TiVo litigation and higher churn, lower ARPU and bigger net losses than currently expected.DTV: Risks include higher coss (both retention and SAC) than currently anticipated and international exposure (foreign exchange/macro).ETM: Risks to our valuation range include a downturn in the economy or an advertising recovery that is slower than expected.GTN: Risks include a weaker recovery than currently expected and competition from other media.LAMR: Risks include a slower-than-anticipated recovery and a slower-than-anticipated ramp in digital billboards.SBGI: Risks include high investor expectations and a potential slowdown in auto spending.SGA: Risks to achieving our valuation range include an economic and/or advertising downturn, a longer-than-anticipated lag between ratings improvement and revenue growth and potential integration difficulties with recent acquisitions.TVL: Risks include the company being unable to meet/exceed the Street's high expectations and the inability to show sustainable growth levels post 2010.TWC: Risks include more subscriber losses and higher programming expenses than currently expected.

Wells Fargo Securities, LLC does not compensate its research analysts based on specific investment banking transactions.Wells Fargo Securities, LLC’s research analysts receive compensation that is based upon and impacted by the overall profitability and revenue of the firm, which includes, but is not limited to investment banking revenue.

STOCK RATING1=Outperform: The stock appears attractively valued, and we believe the stock's total return will exceed that of the market over the next 12 months. BUY2=Market Perform: The stock appears appropriately valued, and we believe the stock's total return will be in line with the market over the next 12 months. HOLD3=Underperform: The stock appears overvalued, and we believe the stock's total return will be below the market over the next 12 months. SELLSECTOR RATINGO=Overweight: Industry expected to outperform the relevant broad market benchmark over the next 12 months.M=Market Weight: Industry expected to perform in-line with the relevant broad market benchmark over the next 12 months.U=Underweight: Industry expected to underperform the relevant broad market benchmark over the next 12 months.VOLATILITY RATINGV = A stock is defined as volatile if the stock price has fluctuated by +/-20% or greater in at least 8 of the past 24 months or if the analyst expects significant volatility. All IPO stocks are automatically rated volatile within the first 24 months of trading.

29

Disclosures

29

As of: 9/10/201047% of companies covered by Wells Fargo Securities, LLC Equity Research are rated Outperform. Wells Fargo Securities, LLC has provided investment banking services for 43% of its Equity Research Outperform-rated companies.50% of companies covered by Wells Fargo Securities, LLC Equity Research are rated Market Perform. Wells Fargo Securities, LLC has provided investment banking services for 44% of its Equity Research Market Perform-rated companies.3% of companies covered by Wells Fargo Securities, LLC Equity Research are rated Underperform. Wells Fargo Securities, LLC has provided investment banking services for 37% of its Equity Research Underperform-rated companies.

Important Information for Non-U.S. Recipients EEA – The securities and related financial instruments described herein may not be eligible for sale in all jurisdictions or to certain categories of investors. For recipients in the EEA, this report is distributed by Wells Fargo Securities International Limited (“WFSIL”). WFSIL is a U.K. incorporated investment firm authorized and regulated by the Financial Services Authority. For the purposes of Section 21 of the UK Financial Services and Markets Act 2000 (“the Act”), the content of this report has been approved by WFSIL a regulated person under the Act. WFSIL does not deal with retail clients as defined in the Markets in Financial Instruments Directive 2007. This report is not intended for, and should not be relied upon by, retail clients.Australia – Wells Fargo Securities, LLC is exempt from the requirements to hold an Australian financial services license in respect of the financial services it provides to wholesale clients in Australia. Wells Fargo Securities, LLC is regulated under U.S. laws which differ from Australian laws. Any offer or documentation provided to Australian recipients by Wells Fargo Securities, LLC in the course of providing the financial services will be prepared in accordance with the laws of the United States and not Australian laws.Hong Kong – This report is issued and distributed in Hong Kong by Wells Fargo Securities Asia Limited (“WFSAL”), a Hong Kong incorporated investment firm licensed and regulated by the Securities and Futures Commission to carry on types 1, 4, 6 and 9 regulated activities (as defined in the Securities and Futures Ordinance, “the SFO”). This report is not intended for, and should not be relied on by, any person other than professional investors (as defined in the SFO). Any securities and related financial instruments described herein are not intended for sale, nor will be sold, to any person other than professional investors (as defined in the SFO).Japan – This report is distributed in Japan by Wells Fargo Securities (Japan) Co., Ltd, a Japanese financial instruments firm registered with the Kanto Local Finance Bureau, a subordinate regulatory body of the Ministry of Finance in Japan, to conduct broking and dealing of type 1 and type 2 financial instruments and agency or intermediary service for entry into investment advisory or discretionary investment contracts. This report is intended for distribution only to professional customers (Tokutei Toushika) and is not intended for, and should not be relied upon by, ordinary customers (Ippan Toushika).About Wells Fargo Securities, LLCWells Fargo Securities, LLC is a U.S. broker-dealer registered with the U.S. Securities and Exchange Commission and a member of the New York Stock Exchange, the Financial Industry Regulatory Authority and the Securities Investor Protection Corp.This report is for your information only and is not an offer to sell, or a solicitation of an offer to buy, the securities or instruments named or described in this report. Interested parties are advised to contact the entity with which they deal, or the entity that provided this report to them, if they desire further information. The information in this report has been obtained or derived from sources believed by Wells Fargo Securities, LLC, to be reliable, but Wells Fargo Securities, LLC, does not represent that thisinformation is accurate or complete. Any opinions or estimates contained in this report represent the judgment ofWells Fargo Securities, LLC, at this time, and are subject to change without notice. For the purposes of the U.K. Financial Services Authority's rules, this report constitutes impartial investment research. Each of Wells Fargo Securities, LLC, andWells Fargo Securities International Limited is a separate legal entity and distinct from affiliated banks. Copyright © 2010Wells Fargo Securities, LLC.

Marci L. Ryvicker, CPA, CFA

New York, New York

September 16, 2010

Please see page 24 for rating definitions, important disclosures and required analyst certifications.

Wells Fargo Securities, LLC does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of the report and investors should consider this report as only a single factor in making their investment decision.

Television Bureau of Advertising (TvB) Forward Conference

marci l. ryvicker, cpa, cfa new york, new york september 16, 2010 please see page 26 for rating...

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