CART MEDIA CONFERENCE

August 16, 2001

Keith Allo

Tom Carter

Rob Correa

Joseph Heitzler

Jim Liberatore

Mike Tranger

JOE HEITZLER: First of all, thank you very much for joining us today. As promised several months ago, CART embarked on a program to create a broadcast coming environment that would enhance the exposure for our fans, our viewers, our sponsors, our promoters, and our investors. We are proud to announce this morning that CART has accomplished that goal in entering into a broadcast agreement with our new partners and CBS, and Fox Cable Networks Speedvision. Our goal at CART has always been to enhance our broadcasting package, and to bring an environment that has increased number of hours of coverage and we're happy to announce this morning that that coverage is going to increase by approximately 60 percent. We also, as a goal, to being in an environment where we truly had experienced partners and we believe that CBS over the years has proven that they have tremendous background in auto racing and we've all experienced the excitement that Fox has brought us in their first year of auto racing this year. We believe that these are two significant partners for CART and that we'll be able to be involved in the executive production, and the marketing and the programs that these two entities will join with us at CART to create. We think this is an environment that will be highly beneficial to our fans and our viewers and our sponsors. And we have been committed to taking an aggressive step to bring better broadcast coverage to our fans. And this morning, we believe that in this announcement the aggressive steps that we have taken and the initiatives that Fox and CBS have demonstrated during the course of our negotiations will shortly be realized for the benefit of our sponsors and our fans. Once again, we are committed to delivering the best and the most exciting open-wheel racing to our fans and all the constituents in the CART community and thank you for being with us this morning with this exciting news for CART.

ROB CORREA: Talent is an issue that we're going to be addressing in the next month. And we just made the deal with CART, so we have some work to do with talent. But we're pretty open at this point, we really don't have anything to announce.

ROB CORREA: All our races we're planning to schedule in the afternoon.

TOM CARTER: That is basically correct. We're having the expenses for the production and the time buy on CBS and that would be all of our expense that we would be incurring.

TOM CARTER: That's also correct.

TOM CARTER: We have not determined that as of yet. It's a little too early in the process and once we get out in the market, we'll have a better idea of that.

JOE HEITZLER: I am going to let the representatives from Fox and from CBS answer that. But I will tell you that during the course of our negotiations with both CBS and Fox, the most impressive aspect of the conversations was that these two entities wanted CART and they wanted us for reasons of inventory, yes, but they wanted us because of the exciting racing that we have and I am sure that they will answer that question after this. The second one on the international, we're in the process now of dealing with several entities and one of those entities is Fox International. Once we have completed those negotiations, we'll pass that information along. Perhaps Jim Liberatore the President of Fox Cable Network Speedvision could talk to the promotion and marketing.

JIM LIBERATORE: Yeah and again -- we haven't specifically gotten into that. However I think you can tell from our perspective how important the 14 live races and the repeats will be to us. And I think it is safe to say that we will have promotion and marketing that is going to represent the importance that the live and eight or seven races are going to have on our network.

ROB CORREA: Much like Speedvision, I can't tell you specifically how we're going to promote CART but it is our entree back into the auto racing business. It is a terrific sport, deep in tradition and history, and we very much plan on telling our audience when races are going to be on.

JOE HEITZLER: Following up, if Jim could mention that presently we're structured as the only live racing that will be on Speedvision at this time. I think that comment was made and in addition to that, you will see that the number of hours have increased approximate 60 percent so a lot of marketing and promotion will go around that environment.

JOE HEITZLER: In the first part of the question is I think that this television package meets the criteria of the aggressive growth of exposure we wanted to bring to our fans. And those steps of our sponsors, and the quality of the television coverage, that is the most intriguing aspect of this new partnership with CBS and with Fox Speedvision. So I think with the issue relative to how this will be presented, the races will be presented in their entirety. On Speedvision there will be three-hours races on the street in road and four hours on the 500 miles. In addition, there will be 24 one-half hour shows entitled: This Week In CART, I think, that's -- Jim, that is the preliminary name that we have given it?

JIM LIBERATORE: Yeah, it is.

JOE HEITZLER: So I think for the general base of open-wheel racing this is going to give open-wheel racing a tremendous advancement as it relates to exposure. This is going to approximately, with reruns, and the timing of the reruns, it is going to be in the neighborhood of about eleven half hours a week of open-wheel racing, CART Open-wheel Racing, so we think that's a very aggressive direction to improve our sport and we think it will take us to a higher level of visibility and reputation, and we're just pleased that we have got two experienced networks that have a tradition in auto racing. So we look at that as only a positive for open-wheel auto racing.

TOM CARTER: Regards to the first part of that question, as far as the average ad rate is concerned, having just signed the deal I think it is a little early for us to comment on that and know what the market will be for that. Your second question as far as number of races on CBS and the exceeding years, plan to be either seven or eight race.

TOM CARTER: We're still working on a few items and trying to nail down the '02 schedule and as soon as we have that completed, we'll have another announcement in regards to that.

MIKE TRAGER: We have talked about it between the two parties and overruns are always a problem on network and having a cable partner like Speedvision I think is going to help us a lot. I think we're going to have meetings on that. We haven't revolved those issues. Those are normal issues that everybody confronts on a regular basis on the weekend whether it is golf, auto racing, or anything else. So I don't think we have a specific answer other than to say that we recognize the situation and we're already discussing how we're going to handle it.

JIM LIBERATORE: That's a hard question to answer given current advertising climates. A lot of that changes base off of what is going on economically. We have just started looking at a lot of this right now. This was, you know, we really -- it was a short process in finalizing the deal. So this is not really to skirt the question, I really just don't have an answer right now.

ROB CORREA: I can't really speak for what ABC. Is doing. That's ABC. But I can say that it will be important for us to promote CART on CBS because we recognize it is important, that's what we're going to do.

ROB CORREA: That is a tough question to answer. We're just going to have to get into it. I think in today's day and age, any ratings growth in many sports staying flat from year to year is considered positive. I think any ratings growth that we can achieve in CART next year on CBS from this past year will be considered a resounding success.

ROB CORREA: The first part of the question, in terms of number of races, it's really a function of our sport schedule in many regards and the CART schedule. Obviously we have football and NCAA basketball and golf commitments, but we are going to work with CART to do as many races as we can and to do as many races as they want on network; whether, you know, in years 2003 and 4, if that's more than seven and that can work out for all parties, that's what we're going to try to do.

ROB CORREA: It is our intent to do a minimum of seven.

JOE HEITZLER: That's a good question. I think the most demonstrable way to answer that is to reflect on what Fox achieved this year in their NASCAR production. And I think that it would have been remiss of me as the Chairman and CEO of CART to try and feel that we could do a better job of that. And so with Jim Liberatore and Jeff Shell and David Hill, there was a convincing conversation relative to their expertise and that conversation was a very short one because it is so obvious that they - CBS set the bar for many years in that field and Fox last year certainly took the mantle of that challenge and raised the bar yet again. And I think with that kind of talent that David Hill and Jeff Shell and David Hill bring to this, we felt that as being the co-executive producers of the show that we would be able to bring the things to our sponsors that they are looking for. And that is the number of increased hours and that's the number of off-air race programming that we're bringing. And we feel that the production values of CART are going to be greatly enhanced by virtue of these two relationships.

ROB CORREA: Point of clarification from the CBS end, just so everybody is clear, we will be responsible for our own above-the-line. In other words, we're going to produce and direct the CART shows on CBS as well as hire our own talent. I think it -- very clearly, it is very important to us that we have a distinctive CBS look. We're thrilled that the Fox people are going to be supplying facilities because that is absolutely crucial in auto racing. But again, I just want to make it clear that our shows will have a CBS imprint on them.

JIM LIBERATORE: To answer the first on the number of homes I think if you look what's happened in the last few month, Speedvision as it was known is going to be a completely new entity from the graphic packages, to promos, marketing, this is a Fox Network and this is going to look and act and feel like one. Now, the network, and there was some talk, I know months ago about the NASCAR issue, nobody wants this to be a NASCAR channel including NASCAR. Everybody understands that a network like ours has to be vertically and horizontally programmed. And what I mean by that is you need, in order to make sure that you are gaining clearances with the affiliates, you need to really make sure you are still satisfying those niche markets; whether it's the motorcycles or some of the other programming. But the amount of programming we have and the dedication that we're going to have toward this CART package will not affect what the plans are for NASCAR. Yes, the plans are we are definitely going to be doing a lot more NASCAR programming but when you -- the percentages are not agreed upon or finalized, but when you are a 24-hour network obviously 50% may seem like a lot but that still leaves a lot of quality time for other things. So I just want -- that's kind of -- since my announcement just came out this week that's a question has come up a lot is that is this is not going to be a NASCAR-only channel and this arrangement, I think, speaks to that. And the fact that Speedvision received over 40,000 e-mails and petitions asking not to become NASCAR-only you know, we hear that and that's the direction that this channel is going.

JIM LIBERATORE: I think from our perspective obviously we'll be promoted throughout the Fox Cable Network side. That's one thing we have talked about and I know that this -- you know, anything that goes on this network or any Fox Network is going to have that the type of support that you have seen. Past that, we haven't had any conversations with -- nothing has been described exactly with CBS or during their races.

JOE HEITZLER: That's something I'd like to see happen. And I have a meeting next week with Rob and -- we just concluded this agreement about 8:30 Saturday night so that Jim could keep his marriage intact by making it to the 10 o'clock movie. So we have only had since Saturday around 8:30, 8:45 to have these conversations. So these conversations will be ongoing the next several weeks with Michael Trager, myself, and CBS and Jim at Fox.

JOE HEITZLER: I believe right now we plan on either fourteen or fifteen on Fox Cable Network Speedvision and seven/eight on CBS. we're going to have those conversations yet in the next week to ten days.

JIM LIBERATORE: That's a hard question to answer based off of -- you know, the distribution you could have some distribution in a given market and it's a percentage. Tell you the truth, I don't know the answer to that question: That's part of -- we move forward with NASCAR and CART obviously that's why we're going to make this such a priority to us because that's how we continue to grow in our distribution.

JIM LIBERATORE: Right and that is the other thing I want to clarify too. The plan right now is that this is Speedvision deal. It is open and available for us at some point if we want to expand that or move it to the other Fox Cable Networks, but the idea and the concept right now is this is a Speedvision and it's not going to be quite the same way as some of the NASCAR programming is, I mean, all of this programming, it has been contemplated, will run on Speedvision and we'll have the option and opportunity to look at the other cable networks, but this is clearly a Speedvision deal.

JOE HEITZLER: I think that what we're trying to do is we're trying to put an environment together that for the long-term growth of CART and its fans, and its viewers and its sponsors, that we can be in an environment that we are participating in on a programming end and that we believed in our conversations and we have no doubts on the Fox Speedvision side that they are making an enormous commitment financially and programming-wise, to becoming a very predominant motor racing driven environment. We believe that with the NASCAR programming also they have the same goals of getting into those markets that right now may not have it. So as I said we just finished this on Saturday and these are lots of conversations that we'll be having, but I think the net gain is a long-term issue of people. Once we solve the distribution and the footprint that we're going to have an enormous benefit of working together in building this with Speedvision and we think that in the long run is going to benefit our viewers.

JIM LIBERATORE: Remember also through direct TV and Echo Star that we are technically available to anybody who wants it. Because of the demographics of this audience, because of the size of this package, we really are truly available to anybody who wants it; just not through their traditional cable channels.

MIKE TRAGER: I think the one thing you are forgetting is two things - you refer to NASCAR but remember NASCAR also put a considerable amount of programming on FX knowing that FX also was in a similar position Speedvision is in not have full coverage. The minute that certain programming that was desirable to the audience appeared FX had an inordinate growth in a very short period of time. I think we're expecting Speedvision to have that same kind of growth with CART and NASCAR programming being added to the schedule which currently doesn't exist on the network now and so you are making a presumption that what you see today is what it is going to be in 2002 and I think that's erroneous.

JOE HEITZLER: This does specifically allocate time and coverage for our

ladder series.

JIM LIBERATORE: Yeah, we are going to be doing some of those series but again this is all -- has happened relatively quickly so we haven't decided but that is part of the arrangement that we will do some of those series.

T.E. McHALE: We're going to wrap it up for the afternoon. We want to thank our Joe Heitzler, Rob Correa, Jim Liberatore, Mike Trager, Tom Carter and Keith Allo for being with us this afternoon. Gentlemen, thanks for joining us and best of luck with the new TV deal. Thanks to all of who you joined us on the call this afternoon. We wish you a pleasant good afternoon and we'll talk to you down the line.