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Surf the Net. Cruise the news.

To: General ManagersTribune-Review Publishing Co. Ne\I\ISPapers

From: Bill BrownDirector & General ManagerPittsburgh LIVE.comITri butaries

Date: 01/28/98

Re: Introducing pittsburghLIVE.com

It is a pleasure to address you this aftemoon. While still relatively new to the Tribune-ReviewPublishing Co., I am pleased to have the opportunity to work with you in creating a new paradigm indelivering news and information to our current customers; through these efforts, we will createadditional value to the organization through increased readership popularity and a subsequent,substantial new source of additional revenue.

First, as I am no longer the newest member of the team, it will be beneficial for everyone to leam someexciting facts about our current online initiatives:

• "Tributaries", launched in 1995 by Tribune-Review, became the first daily online newspaper inWestem Pennsylvania, gaining valuable "first-to-market-advantages" in viewership, customeracceptance, and ongoing brand loyalty.

• Today, Tributaries receives more than 220,000 visitors each week, who collectively download morethan 2.6 million page views and register 14 million "hits".

• We have formed innovative partnerships with organizations such as the Pittsburgh SteelersFootball Team. We serve as the official Web site for the club, and combine our comprehensive,original content with resources from the team to promote the "cult-following" of fans worldwide.

• Our "Steelers Online Fan Club" combines with our other value-added resources to drive onlinemerchandise sales. In 1997, sales surpassed $100,000, which is a modest number when oneconsiders that we will not until February 1 be enabled to conduct electronic commerce online(using VISA, MasterCard or American Express to purchase merchandise through securedelectronic transactions).

• Over the course of a full-month, our 880,000+ visitors who download more than 10.4 pages, aresubstantially more than any other regionally produced Web site, and rank higher than these large-city newspapers(*):

• Christian Science Monitor (1,185,924 monthly page views), $32 CPM

• Dallas News (731,854 monthly page views), $30 CPM

• San Jose Mercury News (5,868,690 monthly page views), $35 CPM

622 Cabin Hill Drive, Greensburg, Pennsylvania 15601 , Voice: 412·850·2131 , Fax: 412·837·6456 , http://tribune-review.com

• The Seattle Times (3,050,288 monthly page vie'NS),$30 CPM

• The Tampa Tribune (3,073,218 monthly page vie'NS),$27 CPM

• Compared with large subscription print publications(*), both dailies and monthlies, we comparevery well, especially when you remember that we are focused exclusively on local, WesternPennsylvanian content:

• Car and Driver (2,691,883 monthly page views), $60 CPM

• Fitness Online (1,700,000 monthly page vie'NS),$45 CPM

• Fortune Online (6,000,000 monthly page vie'NS),$40 CPM

• Money Online (8,500,000 monthly page vie'NS),$40 CPM

• Pathfinder Network (all sites) (72,000,000 monthly page views), $28 CPM

• People Online (12,000,000 monthly page vie'NS),$30 CPM

• Penthouse (23,520,000 monthly page vie'NS),$18 CPM

• Playboy (44,168,396 monthly page views), $14 CPM

• U.S. Ne'NSOnline (5,200,000 monthly page views), $50 CPM

• USA Today Online (100,000,000 monthly page views), $30 CPM

• The Wall Street Joumallnteractive (34,600,000 monthly page vie'NS),$65 CPM

• Washingtonpost.com (25,000,000 monthly page views), $32.50 CPM

• On March 2, we relaunch Tributaries as "pittsburghLlVE.com", which will be supported with asubstantial media buy for late February-all of March.

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• Extensive use of television, radio, billboard, king board, and substantial print advertising isplanned to promote this launch throughout the region

• You will be invited to attend the "launch kick-off', to occur at lunchtime on March 2 at theBarnes and Noble Superstore on 5th Avenue, center city Pittsburgh.

• The goals of pittsburghLlVE.com are:

• Position Tributaries with a dearly identifiable brand identity

• Build the brand around the epicenter of local commerce, culture and information

• Migrate from a "site" to a "channel" paradigm

• Grow traffic from 225,000 visitors and 2.6 million page vieINS,to 500,000+ visitors and 4.6-5.3million page views, weekly (by 1998 year-end).

Revenue Model

• Online dassifieds. Estimated at approximately $350,000 in 1997, Tribune-Review has "up-sold"fees into classified rates at between 1~ 15%. This number should grow with the availability ofadditional dassifieds through all 8 Scaife newspapers.

• Online Business & Services Directory (a.k.a.: Yellow Pages). At present, we are referring to this as"CompassLlVE". A "virtual team" has been contracted on an outsourced basis to develop acustomer base that will result in at least 1200 customers of expanded, value-added services atpremium rates. The complete database will have several thousand listings by 1998 year-end.

• These services include site design, hosting, and maintenance.

• Internet Service (currently provided through InfiNet)

• National banner advertising. (Please refer to earlier discussion of CPM rates)

• Online merchandise sales. Tribune-Review is aggressively pursuing partnerships with suchprominent, local institutions as the Andy Warhol Museum, Dick's Sporting Goods, Pizza Outlet, andGiant Eagle in order to provide exclusive access to online merchandise throughpittsburghLlVE.com. Services provided at minimum 5% commission to Tribune-Review.

• Exclusive sponsorship opportunities for preferred advertisers.

• "Next generation" revenue from Real Audio/Real Video.

You will discover, too, that many national and local advertisers have noticed that we're popular here inthe Pittsburgh area: at this time, Wal-Mart, Dollar Bank, Elisco Advertising, theStreet.com, 1-800-Present, the University of Pennsylvania Wharton School, Dial-A-Mattress, Avis-Rent-A-Car, RandomHouse Books, and the United Way have each advertised aggressively through Tributaries over the lastmonth. You will not find this breadth of major accounts on any other local Web site - our advertisersbenefit from our unsurpassed local traffic.

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We attain such high visitor statistics through our partnership with the Steelers, as well as througharrangements with "Stan & Guy", the popular local sports-talk show duo. We offer the online "MotleyFool", which receives thousands of "hits" each week, and we cover local technological developmentsthrough the "Digital Age" section with special, original Tributaries-only content from the prominent lawfirm of Titus and McConomy.

Most exciting, perhaps, is our new partnership with Barnes & Noble, the online booksellers. We arenow working together to offer our readers discounts of as much as 40% off all hard cover books shouldthey be ordered through the Tributaries I pittsburghLlVE.com site.

I am hopeful that we can see the mutual advantages of this strategy. Through this approach, Tribune-Review can derive increased revenues, brand awareness, and presence on the Web.PittsburghLlVE.com and Tribune-Review will benefit by being able to offer more value-added servicesto our customers, while driving more traffic to our site in the meantime.

Please contact me at a suitable time to discuss - I am very eager to follow-up with you. I can best bereached by numeric pager at 4121617-4455 (office: 380-8540).

Sincerely,

William J. BrownDirector and GMpittsburghLlVE.com (March 2)

William Brownll@msn.com

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