Good day, everyone, and welcome to the CBS Corporation fourth quarter 2006 earnings release teleconference. Today's call is being recorded. At this time I would like to turn the call over to the Executive Vice President of Investor Relations, Mr. Marty Shea. Marty Shea: Good morning, everyone. Thank you for taking the time to join us for our fourth quarter and full year 2006 earnings call. Joining me for today's call are Sumner Redstone, our Chairman; Leslie Moonves, President and CEO; and Fred Reynolds, our Executive Vice President and CFO. Sumner will have some opening remarks and will then turn the call over to Les and Fred for strategic and financial issues. We will then open up the call to questions. Let me note that statements on this conference call relating to matters which are not historical facts are forward-looking statements which involve risks and uncertainties that could cause actual results to differ. Risks and uncertainties are disclosed in CBS Corporation's news releases and security filings. A summary of CBS Corporation's fourth quarter and full year 2006 results should have been sent to all of you. If you did not receive the results, please contact Punam Visay at 975-3667 and she will get it to you. A webcast of the call, the earnings release and any other information related to the presentation can be found on CBS Corporation's corporate website at the address CBSCorporation.com. Now I'll turn the call over to Sumner. Sumner Redstone: Thanks, Marty. Good morning, everyone. I really thank you for being with us today. When we look at our terrific fourth quarter and full year 2006 results, one thing is very clear: what a success the new CBS Corporation has become in its very first year. We have done a phenomenal job operating our core business,…

(Operator Instructions) Your first question comes from Victor Miller - Bear Stearns. Victor Miller - Bear Stearns: Fred, I have a question for you and one for Leslie. In terms of the 39 radio stations and nine TV stations at UPN, the net political dollars that you had last year versus what you anticipate this year, syndication revenues you talked about, can you give us a sense when you wrap that all together, Fred, what does that mean in terms of the revenue drag potentially for this year versus last year and in the sense of the EBITDA associated with that bucket of pieces? Leslie, in terms of the radio business you have been able to sell your radio stations at about a 14.1X multiple overall. I'm wondering two things philosophically. One, is there any more to do in terms of paring back that portfolio? Secondly, if you look at a lot of the radio growth that Clear Channel just reported, one could argue that it comes from Premier, which is its network business. As you know, Citadel is now buying ABC's network business along with its station so there's, again, an integrated radio network presence. There are two of those in the marketplace, Westwood is kind of a separate entity and you own an 18% stake in it. Does it make any sense to have in your case those two together? Thanks. Les Moonves: In terms of paring it down, right now we're pretty satisfied. We did an analysis at the beginning of the year of what we felt were the smaller markets least likely to grow stations. When you're able to get the multiples that we got, we did that. It's not to say that we won't look at it and potentially pare down further, but at the…

Your next question comes from Jessica Reif-Cohen – Merrill Lynch. Jessica Reif-Cohen - Merrill Lynch: Les, as you reshape your assets over the next three to five years, how different will the revenue and cash flow mix be? Do you need to make acquisitions? Where do you stop with the dispositions? Could you just give us a little guidance on how much you plan on spending for digital boards in outdoor in '07 and '08? Les Moonves: Jessica, the first question is a tough one. Obviously we are investing in a rather small way in a variety of new media assets. We do believe in their long-term growth and that that's where a lot of our revenue is going to come from in the future. It's really hard to assess where that is. As it stands now we still believe in the blocking and tackling of our basic assets which are television, radio and outdoor and they're still great businesses. There will be obviously revenue and profit migrating into new media assets and we intend to be there in quite a large way. We didn't have any great intention to sell our television stations, these nine stations, but at the multiples that we were offered they were very, very high prices and we had to look at that. The same thing with our radio stations. On one hand people say, gee, radio is slowing down. At these multiples it certainly doesn't look that way. So we're pretty pleased with the way we ended up and we would always listen to a reasonable offer. Fred Reynolds: Jessica, on the outdoor, one of the big jumps in the fourth quarter of '06 was in outdoor, about $29 million to $30 million. Most of that was with the London Underground and a lot of that is digital. We were looking to expand our capital spending in '07 in outdoor by about $40 million to $50 million, and I would say a good share of that, the lion's share of that, is probably for digital outdoor in the UK. Just to give you a perspective on where we are. At the end of '07 we expect to have in the U.S. about 300 digital boards installed. That is up from about 160 where we are now. In Europe because of the London Underground, we are going to have thousands of boards, but they're going to be more the display boards. We could end '07 with about 3,000 display boards with the lion's share in the London Underground. So I think you can kind of plan on $30 million to $40 million a year in the expansion of our boards. Most of it will be in the digital area.

Your next question comes from Lucas Binder - UBS Investments. Lucas Binder - UBS Investments : On retransmission, obviously it is good direction, the announcement last week with regard to the nine cable companies, MSOs. What is the timeline for the next step and what can we look out for as far as additional negotiations ahead of the big MSOs in 2009? Fred, you mentioned on a gross basis you are about 2.2X leverage. Do you see opportunity to increase that, and potentially following on how the share buyback goes you'll look to do additional buybacks in the future? Les Moonves: On the retrans, obviously we are extremely pleased by the nine MSOs that have jumped on board. You're going to see more and more of these smaller operators and some of the not so small operators coming around. And as I said, there's a shift, there's a new paradigm. As I've said before, MSOs are already paying for networks. You can disguise it under other things as everybody has done. I've said this before, if you're paying $3 for ESPN, you're really paying $2.50 for ESPN and $0.50 for ABC. We are now a stand-alone. We see more and more of the MSOs getting on board. As you noticed, these nine MSO deals were done without a whole a lot of noise. There weren't big newspaper ads, there weren't big fights, there wasn't anything pulled off the air. So I think the MSOs are realizing that it's better to get along than to fight. Yes, the big ones are up in '09 and '10, but you'll see us do a number of deals before then. Fred Reynolds: The leverage ratio, as we said before, is really at the low end of what we targeted. We have some debt maturities…

Your next question comes from Kathy Styponias - Prudential. Kathy Styponias - Prudential: Les, I was wondering if you can reconcile for us in light of your retransmission consent deal, your decision to sell TV stations albeit in smaller markets, in light of the fact that it's at the TV station level that you're actually capturing the cash for retrans consent, why are you selling stations and what should we expect from you with respect to further TV station sales? Fred, I was wondering if you can give us any sort of color on what the value that you're extracting for retransmission consent for the CBS signal? Thanks. Les Moonves: Kathy, in terms of that, obviously we weighed that. These are really small market stations that we sold. We weren't going out there looking for them, but when you get the opportunity to sell them at those phenomenal multiples, you figure in what retrans potentially could be and the economics still made much, much better sense to do a sale. Having said that, there would be little chance that any major station would be sold because the future is extremely bright for what they will get per sub. So we factored that in and it all worked out in our favor. I'm not going to let Fred tell you what we're getting per sub. Fred Reynolds: Kathy, obviously Leslie has stated that the value of our content and I guess you can be assured that we're going to be fairly compensated for that in these deals. I would echo what Leslie says about these businesses. When you get a 15X after-tax multiple, Kathy, as you know, on businesses like Austin we could have baked in almost ESPN kind of retrans and not gotten those multiples.

Your next question comes from John Klim - Credit Suisse. John Klim - Credit Suisse: Have you seen any material impact or could you talk about any impact on the ratings of the shows that you've highlighted on YouTube? Could you update us on how you feel about further developing your relationship with YouTube or its parent company, Google? Thanks. Les Moonves: Sure. Our deal with YouTube where we supply certain entertainment news and sports content is primarily promotional at this point in time. Certainly with the entertainment stuff we have seen certain cause and effect from some of our research. It's rather early to say, but in terms of the number of hits that our promos get on YouTube, arguably our content is promoted so heavily because of the number of people. In addition, it's bringing in a younger demographic. We think it is fairly significant. It's hard to do an absolute cause and effect, but we know it absolutely is helping. We are looking at every single outlet there is for our content. We are talking to everybody. As you've seen, we've done deals with just about everybody and it's something that all the companies are looking at and how do we maximize our content in the future either through advertising sales or through promotion.

Your next question comes from Doug Mitchelson - Deutsche Bank. Doug Mitchelson - Deutsche Bank: Les, one of your most under-monetized assets when you look across your company remains your TV library, maybe even current TV production. So cable operators are sitting there with plenty of servers at their head ends, waiting for the green light to offer as much TV content and demand as you will give them. What's holding you back right now from offering more or all of your content on demand? I know that you're doing some, but it's tiny relative to the totality of your TV library and current production. Maybe along a similar vein, what happened in the Google negotiations that made you uncomfortable that you didn't want to give them broad distribution of your TV content at this time? Was it monetization, was it rights? What was it? Les Moonves: No, it's a very valid point. Our TV library is unbelievably valuable and it is relatively undermined. We have not put a lot of properties out there. The main reason -- this sort of ties into your second question -- is we want to get paid appropriately for it. We will eventually have our library out there, it will be on demand either through advertising, subscription or pay per view, some way shape or form, we just value it very highly and very dearly. We obviously get paid through syndication and DVDs. It is inevitable that our library is going to be out on the Internet and downloaded and we will be making deals for this content. The good news for us as we go forward is, you're right, it is undermined and there's a great future ahead with this library and with our current production. So look for more things in the…

Your next question comes from Anthony Diclemente - Lehman Brothers. Anthony Diclemente - Lehman Brothers: Fred, if you take the free cash flow that you reported in this release for '06 and you add back the $250 million in pension contribution, which I think most people would agree is discretionary, you get to about $2.40 a share of free cash flow. My question is, as we move forward into '07 you're looking for comparable EBITDA. Is there any reason that the free cash flow number shouldn't move in somewhat lockstep with EBITDA? Is there any change in working capital or change in CapEx that's dramatic that we should know about? Is there any chance that the retransmission deals that you have in place with the larger cable operators, that being Comcast and Time Warner Cable, are renegotiated prior to the '08/'09 time period when those contracts are up? Given the shift that you discuss in the balance is there any chance that you would preempt the existing time horizon on those existing contracts? Thank you. Fred Reynolds: As you know, we don't forecast or give guidance on cash flow. But let me give you a couple comments because I think it might be helpful. In '06 we spent a little under $400 million, $394 million in capital spending. Our expectations, which you'll see in our K that gets filed probably tomorrow or the next day, we are going to give a range of estimates of $450 million to $475 million in capital spending. I personally think we'll be at the low end of that at the $450 million. So we are going to step up capital spending again. The lion's share of it is going to go into outdoor, so that is going to be a change. The one thing…

Your next question comes from Kit Spring - Stifel. Kit Spring - Stifel: A number of your affiliates are being successful with retrans fees. Do you expect to change the relationships with your affiliate so that you garner some of those economics? I think that's been changing over the past five or ten years. Do you see affiliate comp turning to reverse comp and how big of an opportunity is that? Les Moonves: You know, Kit, our relationship with our affiliates has evolved over a period of time. When I first got here we were paying out hundreds of millions of dollars which is virtually down to zero right now. There are a lot of deals that we do with them. Our relationships with our affiliates are great. They like the idea getting paid for retrans as do we. So it's an ongoing dialogue in terms of the content we supply them as well as our relationship with them. So without getting specific it will be an ongoing dialogue and, once again, it continues to evolve.

Your next question comes from David Miller - Sanders Morris Harris. David Miller - Sanders Morris Harris: Outdoor revenue growth plus 10%, that's obviously model growth in the quarter generally comparable to your competitors. I would think, however, that that would be leverageable into at least mid-teens to high teens EBITDA growth. You came in with plus 13% growth. It looks like you got hit by foreign exchange a little bit. Was there something else going on in the quarter expense wise that you could flesh out for us? Also, at your analyst day about a year ago today or a year ago this week or so you had mentioned that the publishing business was also non-core to operations, very similar to the Paramount Parks. What is the status of the sale of that asset? Thanks very much. Les Moonves: David, thank you. I'll deal with the publishing question and I'll flip it to Fred to give you the color on the outdoor business. In terms of publishing, yes, I mean arguably Simon & Schuster is not a core business; however, they are showing a tremendous ability to generate terrific revenues and profits and we love having them with us. We think it's a great asset. As I said, they not only had their best year last year creatively, but financially they're doing far better than people expected. So we love having it and we find no need to sell it, it's going to be a part of our businesses for a long time to come. Fred Reynolds: On outdoor, a couple things in the fourth quarter. Again, I would cite that in U.S. the billboard business was up 12%, and some of it had to do with the revenue growth. As you may know, some of the contracts that…

Your final question comes from Benjamin Swinburne - Morgan Stanley. Benjamin Swinburne - Morgan Stanley: Let me ask you a question on the DVR side. Can you give us an update on your thoughts on Live Plus, what the ad buyers are saying along those lines and any expectation for monetization of recorded viewing in 2007 in your guidance? Les Moonves: Yes, the advertisers got away with just getting Live last May. That won't happen this year. Number one, there are much more sophisticated ways of measurement through the commercial ratings, more Live Plus Same Day, Live Plus Three. It's now going to become a significant number and we need to get paid for that, we will get paid for that. I think all the networks feel like that is a necessity and that it's going to happen which bodes very well for this upfront period. So we're very excited about it. Marty Shea: Thank you, everyone for joining us. I will be available for the rest of the day. Have a great day.