Good day and welcome to the New York Times third quarter2007 earnings conference call. (Operator Instructions) For opening remarks andintroductions, I would like to turn the conference over to Ms. CatherineMathis. Please go ahead, Madam.

Thank you and good morning, everyone. Welcome to our thirdquarter earnings conference call. We have several members of our seniormanagement team here today to discuss our results with you, and they include: JanetRobinson, our President and CEO; Jim Follo, our Senior Vice President and ChiefFinancial Officer; Scott Heekin-Canedy, President and General Manager of TheNew York Times; and Martin Nisenholtz, Senior Vice President, DigitalOperations. Our discussion today will include forward-looking statementsand our actual results may differ from those predicted. Some of the factorsthat may cause them to differ are included in our 2006 10-K. Our presentation will also include non-GAAP financialmeasures and we’ve provided reconciliations for the most comparable GAAPmeasures in our earnings press release, which is available on www.nytco.com. An archive of this call will be available on our website, aswill a transcript and a version that’s downloadable to an MP3 player. An audioreplay will be available and the directions for it are in our press release. With that, let me turn the call over to Janet Robinson.

Thank you, Catherine and good morning, everyone. Today wereported third quarter earnings per share from continuing operations of $0.10,compared with $0.06 in the same period a year ago. This year’s third quarterincluded $0.05 per share of accelerated depreciation expense for assets at ourEdison, New Jersey plant. In last year’s third quarter, we had a $0.03 loss onthe sale of our stake in the Discovery Times Channel. Excluding these twoitems, our third quarter EPS was $0.15 compared with $0.09 last year. Operating profit before depreciation and amortization grew46.4% to $79.9 million, compared with $54.6 million in the third quarter lastyear. The headlines this quarter are improved national advertising, includingrobust growth in online advertising, gains in circulation revenues, andcontinued cost discipline. Before we go into detail on the quarter, I would like tostand back and take a broader view of what we’ve accomplished as it relates toour strategy, which includes introducing new products, both in print andonline, building our innovation capability, and aggressively managing cost. Iwill briefly review our recent accomplishments in each of these strategicareas. The Times company has powerful and trusted brands whoserelevance and superior quality draw educated and affluent audiences. It is truein print and it is true online. As you have heard us say in the past, we arefocused in introducing new products and services across platforms that preserveand enhance our brands and add to revenues. On the print side, we introduced several new ad formats,such as the Spadia, a wraparound ad that NBC used to debut its Fall lineup. Inaddition, we created new advertising offerings in video and in opinion andarchive sections of nytimes.com. New print publications at the Globe, such as Fashion Bostonand Design New England, added to revenues during the quarter. We had considerable success in building out nytimes.com’sverticals in health and business. We also…

Thank you, Janet. As Janet mentioned, we continued totightly manage expenses in the third quarter. Operating costs excludingdepreciation and amortization declined 1.5%, primarily because of lowernewsprint expense. This is partially offset by higher professional fees,primarily due to the costs associated with the company’s new headquarters andexpense reduction initiatives. Newsprint expense decreased 22.2%, with 13.4% of the declineresulting from lower newsprint prices and 8.8% resulting from decreasedconsumption. During the third quarter, the Times reduced its web width and theGlobe expects to do so this quarter, further decreasing our newsprintconsumption. Buy-outs this past quarter were below those of a year ago.In the fourth quarter, however, we expect buy-outs to be approximately $14million to $16 million, compared to $8.5 million in the same quarter last year.This range can vary significantly based upon seniority and the timing ofimplementation. Depreciation and amortization in the quarter totaled $51.8million versus $36.7 million in the same period last year. Part of the increasewas attributable to $6.7 million of depreciation expense associated with ournew headquarters. We also had $11.7 million of accelerated depreciation ofassets at our Edison, New Jersey printing plant, which is in the process ofbeing closed. These increases were partially offset by a decrease of $2.4million from mail room equipment, which is now fully depreciated, at ourprinting plant in College Point. We expect the depreciation for our newbuilding will be approximately $8 million per quarter, beginning in the fourthquarter and going forward. Our effective tax rate in the quarter increased to 39% from32.8% in the same period last year, when a favorable tax adjustment lowered ourrate. The company’s tax rate for the fourth quarter is estimated to be 41%. Moving to CapEx, spending in the third quarter totaled $71million, including $18 million for our new headquarters. We are now in our newbuilding and CapEx on it will…

(Operator Instructions) We’ll go first to John Janedis withWachovia.

Thank you. Good morning. A couple of questions; first,there’s been clearly some talk in the press about foreclosures and economicweakness in the Boston area being ongoing. When you look at business at theGlobe, do you think we are past the bottom there, now that the comps are gone,as you mentioned? Anecdotally, can you give us a sense of what advertisers aretelling you there? And then I have one quick follow-up.

There are some categories, John, that are performing nicelyat the Globe. For example, motion pictures, a lot of the national categoriesdid well recently, motion pictures, the banking industry is really showingsigns of strength, telecommunications, pharmaceuticals, healthcare. Those areall areas that we saw some very strong performance in the third quarter andeven a little bit earlier in the year as well. Where we have seen the weakness is really in the classifiedcategories, help wanted, real estate, and automotive. In regard to retail, as I noted, the retail sector, the foodand drug and the computer and the apparel areas were softer in this quarter,but there are openings in the fourth quarter and more importantly, the verybeginning of next year that will bring in larger advertisers -- Neiman Marcusand Nordstrom’s have already come in with their opening of the Natickcollection. But with several new malls opening next year, there will be otherentries into the market. That still remains challenging right now but theadvertiser base increasing would give us an opportunity we think to see what wecan do in regard to bringing more advertising in. What we’re hearing from advertisers is that they areappreciating the fact that they are able to buy both online and print from theBoston Globe and from the Worcester Telegram and Gazette. There is a fullproduct offering. They are also pleased to see new products being entered,being introduced in the market by the Globe in particular in that retailcategory, focusing on luxury goods in particular.

And as a separate question, it looks like some of thestrength in entertainment has continued into October at the Times, and I’mcurious if this is a trend you expect to continue throughout the quarter, giventhe release slate that you currently see. Thank you.

You’re right. We’re seeing some continuing strength in thestudio category into October. We had an exceptional September but I want toremind you that we’re up against extraordinarily easy comps in September,October from last year. So the strength I would expect to moderate toward thelatter half of the quarter. And I’ll remind you again, as I remind myself every singleday, we’re in a tremendously volatile, low visibility environment. Theenvironment has not changed. We’ve had some good results, as you would expectin a volatile environment, as we have a great brand in the marketplace. Wecontinue to bring excellent product to market and outstanding programs to ouradvertisers.

Thanks, Scott. Sorry, Janet, one last question; I know youreferenced the Monster partnership and I think -- did the regionals start thatpartnership first and then it went to the Globe and the Times? And if so, wouldyou expect to start seeing a ramp at the other properties now in the fourthquarter?

They did start at the regionals very early -- I shouldn’tsay very early in the year. In the March, early April timeframe, followed byBoston and then followed by New York, so I think we are hopeful that indeedwe’ll see some strength increasing in both Boston and New York as the yearprogresses. As I think I noted in my remarks, we have certainly seenvery good signs from that partnership. It is one that indeed we think will workvery well for Monster and for the Times as well.

Great. Thank you very much.

We’ll go next to Fred Searby with J.P. Morgan. Okay, Fred’sline has disconnected. (Operator Instructions) We’ll go next to Alexia Quadraniwith Bear Stearns.

Thank you. A couple of questions; the first, drilling down abit more on the national category, I mean, it sounds like it is fairlybroad-based, or would you say that the bulk of the upside really came from thestudio entertainment category? And I appreciate that there are easier comps inSeptember and October, but you also had some good growth in August. Any reasonwhy we -- I guess we shouldn’t see at least positive growth in national for theremainder of the year?

You are correct to observe we had good strength in Augustand especially into September. The categories, very specifically that drovethat growth was the collection of luxury brand categories, as Janet alreadymentioned, American and international fashion, nice growth in packaged goods,corporate, hotels, studios, cosmetic, books, education, home furnishingmanufacturers. So in that respect, it is pretty broad-based. They are allshowing growth in the quarter and especially in September. The outlook for the rest of the year is continued strengthfor some of those categories. The luxury brand, corporate, hotels, studio, homefurnishing manufacturers, I would expect to see continuing growth. The othercategories will be flat to slightly down, so that’s just a reminder that it’s atumultuous, volatile environment that we’re in. We’ve shown in the last couple of months that we canleverage the strength of the brand in the packages we bring to market and thatwe -- the programs we develop with our advertising clients.

Just a little bit more in regard to Boston, because theirnational grew nicely in the quarter as well. As I said, pharmaceuticals,telecom, healthcare, and banking and studios were the major contributors there. On the banking side, as we’ve noted before on our calls,there is an increased competition in Boston in the banking community, with Citibankgoing into that market with a projected 30 openings. There is an increasedactivity on their part, which has spurred many of the people in the area to domore, particularly B-of-A with their wealth management, but some of the smallerbanks have also done quite a bit more, Salem 5, Mellon, TD Bank North,Brookline Savings. That has helped quite a bit. And on the telecom, Verizon and Comcast are in a heatedcompetition in that marketplace, and that is spurring quite a bit of spendingin the telecom area as well. In studio, to the point that Scott made earlier, there hasbeen very good product in the stream thus far in the quarter and their Fallpreview did very well for them, as well as the Times.

And then on the classified category, which has been such anarea of weakness for a while, the other segment of it stands out as being sucha positive growth driver there. Could you just remind us of the size, therelative size of the other segment of classified? And then my last question would just be on your decision tostop subscription pricing for Times Select. If you could give us an idea of theimpact for that and maybe the reasoning behind that.

Why don’t I take Times Select first while we chase down theother question? The Time Select business was a good business. It was a $10million business. We had several hundred thousand subscribers paying us, aswell as several hundred thousand, 450,000 plus subscribers who came to theTimes bundle, so the program was a success based on the goals that we set outfor it. On the other hand, when we look at the growth in terms ofsearch refers to nytimes.com now and the tremendous, tremendous up-tick throughSEO, which is relatively recent for us. It’s past 18 to 24 months following ourAbout acquisition and we also look at the growth of Internet advertising, asJanet announced yet another strong quarter. It’s just over the long-term, weexpect to see the scale and inventory benefits that accrue to us through searchand SEO significantly outweighing the revenue stream that we had developed inthe pay tier. So in balance, what we’re suggesting is that we fully expectto not only make up but surpass that revenue over time as we grow inventory onthe website and continue to see strong advertising growth.

And to your other question, it’s 4% -- other represents 4%of the classifieds.

Thank you.

We’ll next go to Craig Huber with Lehman Brothers.

Good morning. Thank you. A few things; I know it’s early,but can you just speak a little bit about your plans for advertising ratesacross your major papers for next year? I believe last year, or early this yearyou were basically flat with your ad rates on average at the Boston Globe butup I think roughly 2% at the Times. Should we anticipate much difference inthat trend here as we think out to next year?

Craig, we’re in the process of looking at all of that rightnow. It is a bit early for us to be commenting on that. We certainly arefocused on making sure that the rates are in keeping with market.

Okay, and then just elaborate a little bit further what youmeant by your comments about the October trends at your newspaper? If you couldjust go a little deeper on the category, what the significant changes might beversus what you saw in September.

Well, October we expect to see a growth. We’re seeing growthfrom the luxury brands categories, corporate, hotels, studios, cosmetics, andhome furnishing manufacturers, to name a few. The categories that have been challenges for us throughoutthe year remain challenges in October -- department stores, tech, telecom, theclassified categories, media category, has been a challenge for us through mostof the year but we expect it to be flat in October.

Lastly, if I could, in your newspaper division, yournon-newsprint cash costs, were they about basically flat in the quarter yearover year?

Non-newsprint cash costs were up 1%.

In the newspaper division or overall?

I’m sorry, that’s company-wide. Let me get back to you onthat.

All right. Thank you.

We’ll go next to Karl Choi with Merrill Lynch.

Good morning. A couple of questions; the first one, justwant to again clarify the October trend -- are you saying that you expectcontinued growth in October but just lower growth compared to September, oractually we may still see a decline, back to decline in October? And I have afollow-up.

It’s still early, Karl, in regard to the month. Therecertainly are a couple of weeks still left and from all reports, I think we’vegiven you an overview in regard to the categories that we see some strength inand some, of course, that continue to be soft. So the volatility of the markets in New York and Boston andeven in our regionals, it is really -- it is very, very hard to predict and wecertainly wouldn’t want to over-promise and under-deliver. It is important to note that, just to add a little bit towhat Scott said earlier in regard to the categories, that the Times isperforming well and those that are a bit more challenging. At the Globe, we arecontinuing to see studio, banks, and telecoms perform quite well in October andthe challenging categories up there continue to be apparel and footwear, homefurnishings and real estate. But again, it’s just a bit early for us to bepredicting what October would look like and what the quarter would look like,certainly.

Just following up on the newsprint, the cash costs in thenews media group, it’s down two-tenths of a percent.

Is there a way to size some of the new products that youtalked about earlier, the revenue impact, how much they contribute in thequarter, to give us a sense of the size, that would be great.

It’s really quite hard. The fact that we are doing threeFashion Boston’s and certainly introducing Lola, and we did six issues, infact, of Design New England, would underscore the fact that these are verysuccessful and we intend on them being very successful going forward. They have produced a nice amount of new revenue. A lot ofnew advertisers have entered into the globe with those products, so we thinkthat bodes well for good performance from them going forward. In addition, at the IHT, which is something that I wanted tomention, we are introducing in December T Style Magazine in the editions of theIHT. That has done nicely for us. We have a lot of luxury advertisers who haveembraced that buy, many of whom, of course, are strong advertisers with the NewYork Times, so they are understanding the strength of the T franchise, bothdomestically and internationally as well.

Last couple of questions; could you give us a preview ofwhat the ABC or September ABC stats will be? And lastly, is there a way to sizethe restructuring costs at About.com in the quarter?

As far as the ABC, there will be an audience-fax, which is anew measurement tool coming out I believe the very first part of November, thatwill give you a very good read for all newspapers, not only in regard to thestrict circulation number but also the full audience number, which takes intoaccount, rather, our online audiences as well, which is definitely the way newspapersare selling to clients now. So I think it is early for us to be out with anyinformation regarding ABC.

With respect to About.com, let’s just parse the expenses inthe quarter so that you fully understand what they were. They really came inthree segments. The first segment was additional investments. In particular, wehad some expenses associated with our launch in China. The actual launch istaking place in a week or so but the expenses associated with bringing up theteam and actually the business in Chinawere obviously taken in the quarter. Second, we did have some one-time restructuring chargesassociated with sales development, developing our display sales operation. And then third, we do have somewhat higher expenses, as aresult mostly of compensation. We are in a -- for talent. As you now, theInternet companies across the board are competing ferociously now for technicaltalent and for sales talent, as well as increased payments to the guides as aresult of increased page views. That’s sort of built into the veritable coststructure that exists at About. So the expenses are kind of parsed into those three bucketsand one of the buckets, and they are roughly a third each, and of the bucketsis a one-time expense, so we should see a little bit of margin compressiongoing forward. But as we said in our press release, it’s a seasonalbusiness and we expect to see revenues increase in the fourth quarter as well.

Thank you.

We’ll go next to Peter Appert with Goldman Sachs.

Janet, can you give us any additional color on the retailcategory? Specifically, I’m seeing that the September number was a little bitof a step-down from what you had seen in July and August.

We’ve seen some softness in some of the categories that Inoted -- computer, food and drug, and a little bit in apparel and footwear inBoston. Department stores as well, but as I noted, some of the new entries intothe market are just beginning to ramp up. But it does remain a fairlychallenging category really for all of our newspapers. The Times as well, andScott can comment on this in regard to their work in the retail category. But at the regionals, we are also seeing retail under quitea bit of pressure. Much of that is also, unfortunately, Peter, related to thehousing slowdown because of home furnishings and home improvement. That is acategory that is -- those two categories are directly affected by the retailsoftness.

At the Times, we had expected to see somewhat better resultsin September. The weather seems to be affecting the way that retailers arespending, particularly department stores, and it’s likely it’s alreadycontinuing into October and likely going to affect the fourth quarter. As I had commented on our July call, we had expectation forsome of the previously scheduled Q2 spending to move into the fourth quarter,and so that’s what we’re looking at right now with the question of the weatheraffecting how retailers are advertising.

Scott, do you get sufficient advanced look from bookings tohave a decent sense of how November and December are going to go? I ask becausesome of the retailers are making noise about store traffic trends being weakerand therefore potentially being more conservative in spending plans.

The question is a visibility question and we have somevisibility but advertisers, not just in the retail category but across theboard, are very deliberate in the way they spend and they are looking for thegreatest return on their advertising spend and they make last minute decisionsas they change their strategies or adjust to the marketplace. That’s especiallytrue in retail. The weather is a big factor, as I just mentioned. So that’s thevolatility side of the low visibility, highly volatile marketplace that we’vebeen describing for a few years now.

Okay, fair enough. Thank you. And Jim, I’ll ask you onequestion also, please; can you tell us what the FTEs, the year-to-year changewas at the end of the third quarter versus a year ago? And then also, whatshould we be thinking about in ’08 in terms of sort of some base level of wage andbenefit inflation?

On the inflation side, I think somewhere in the 2.5% to 3%range would be fair. Our total FTEs in the third quarter relative to lastyear’s third quarter was down 4.6%.

And the 2.5% to 3% would include benefits costs?

That’s a good range.

Thank you.

We’ll go next to Paul Ginocchio with Deutsche Bank.

Thank you. Just looking at the September other revenues,does that include the full rental income plus the full revenue income fromGatehouse? If you said that before, I’m sorry.

No, it does include the rental income. It does not includeGatehouse revenue.

When will Gatehouse fully come in? When’s the first fullmonth of the Gatehouse revenue?

It should be in October.

October. Okay, great. Thank you.

We’ll go next to Fred Searby with J.P. Morgan.

Thank you. A couple of questions; one, just Janet, in youropening remarks when you said that you’ve completed the sale of the TV stationand the acquisition of About, it sounds like you are pretty categorically notgoing to look at any divestitures of meaningful size here. I guess that’s whatyou were saying somewhat poetically but -- and then secondly, can you help meunderstand on About? If we strip out the acquisition, just what the organicgrowth, and if we strip out the one-time items that you mentioned, alsorelated, what the operating income growth would have been? Thanks.

I’ll take the first question and then I’ll have Martin giveyou an overview in regard to the About increment. I’m simply noting with the remarks earlier that ourdivestiture of the broadcast group and Discovery Times was true to thestatement that we have made all along, that one of our strategic initiativeshas been to rebalance our portfolio to focus on enhancing the newspapers brandsthat we do have, migrating them online, and investing in very strong digitalproperties as evidenced by the very strong performance of our acquisition ofAbout. We constantly review our portfolio. That is just good business.We constantly, of course, set expectations for the property’s performance, andwe will certainly continue to do that in the days to come. But from astandpoint of our expectations as far as current properties and certainly theperformance of acquisitions, we have set clear expectations for the performanceof all.

And on the About, the core growth rate for revenues was 26%,excluding acquisitions. And as I said I think in an answer to a prior question,if you take the expense number and analyze it, about a third of it is theone-time costs.

And the EBITDA contribution from those acquisitions ispretty close to the core margin rate, so it was not dilutive to the margin in amaterial way.

Thank you.

We’ll go next to [Katrione O’Fallon] with Citigroup. Katrione O’Fallon -Citigroup: Hi, there. Thanks for taking my question. You know, there’sbeen some discussion in the industry recently about the divergence in uniquevisitors on some of the news web pages between the numbers that ComScore givesand what Nielsen gives. And some of your competitors have actually beenclaiming that their unique visitors are a lot higher than what we see from someof these consolidators. I’m wondering what your opinion is on this; the reasonbeing that a lot of people actually view news websites from work where theymight be blocked, their IP address might be blocked behind a firewall orsomething of that nature. I’m just wondering, are you seeing any of this and isthere anything that you can do to communicate this aspect to advertisers andactually benefit from more of the unique visitors?

The answer is yes. We’ve seen this for years. It’s been aproblem for the industry for many years. It’s been a particular problem for, asyou point out, news websites and in particular, it’s been a problem for the NewYork Times website because it not only skews heavily into work locations, italso skews heavily into educational and government institutions, which ofcourse also have different URLs. So it’s an industry-wide problem. The industry as a whole, through the Internet AdvertisingBureau, the IAB, is working with both Nielsen and ComScore to address some ofthese problems, but it’s been an intractable issue over a very long period oftime and we are doing our best to address it. But these companies, we obviouslydon’t control these companies. They are independent entities and they are goingto do what they do. Having said that, we are bringing, as an industry, a greatdeal of pressure to bear in order to get these numbers to square moreaccurately with what we think we are generating in terms of usage. Katrione O’Fallon -Citigroup: Great, and then just a follow-up also on the Internetaspect; can you talk a little bit about the go-to-market efforts here?Primarily, are most of your Internet advertisers also print advertisers? So isthis an add-on sale or do you see some unique, different customers that arejust advertising on the Internet for you?

Just by way of background, at the newspaper websites about ayear-and-a-half ago, or maybe a little over a year-and-a-half ago, we fullyintegrated the digital sales forces and the print sales forces, so we went froma relatively small number of Internet sellers, maybe 40 or 50 sellers at theNew York Times website and a much smaller number in Boston, to a significantlylarger number of sellers across both channels, so print and digital. This had a couple of results. One, it increased ourpenetration into clients and categories, and two, it allowed us to package moreforcefully the offers that we were making in the marketplace. I think a couple of points here; one, we were I believe thefirst significant newspaper company to take this action and among the first inthe media industry in general. And secondly, I think as you look at our displaystrength at the newspaper websites, both in Boston and New York, Boston has hada fantastic year in display and so has New York. I think part of the reason for this is that we have beenable to go to a client’s advertisers with these creative ideas. And in somecases, obviously we respond to the marketplace. In some cases they’re packagesof print and digital and in other cases, they are digital only advertisers. A good example, I think, of a digital only campaign thatjust ran was probably the American Express campaign on Time Select, which justran. And Chanel, you may have noticed if you used the Times website, Chanel dida wonderful little campaign surrounding our flag on the homepage where theyactually were advertising a watch and the time actually changed as you wentback to the website, changed accurately with the time. Tiffany & Companyjust launched its new website on our homepage. So a variety of differentcampaigns are running back and forth. Now of course, at About.com, it’s a very, very differentstory. They don’t have print products, so that’s a native Internet sales force.As I noted earlier, we’ve invested in the quarter to significantly bolster thatsales force going forward in order to keep these and we grew 35% in thequarter, so we need to continue to keep these revenue growth rates up. The Google CPC stuff is performing much better than it didearlier in the year, but display is now carrying an increasing burden as well.So those are Internet only packages. Katrione O’Fallon -Citigroup: Thank you.

At this time, there are no further questions in the queue.Ms. Mathis, I would like to turn the conference back over to you.

Thank you very much for joining us today. If you have anyother questions, give us a call. Bye now.

Thank you, ladies and gentlemen, for your participation.This does conclude today’s conference call and you may disconnect at any time.