Sent: Wednesday, September 28, 2005 10:30 PM
Subject: HD Radio - IMPORTANT

Dear ROC member,

This email is a follow up to our meeting in Philadelphia regarding Cox Radio's offer to conduct a consumer research project to ascertain how our customers/listeners feel about the dial placement of the new supplemental channels afforded our stations when they broadcast in HD.

Background:

When an FM station begins broadcasting in HD, it has the opportunity to add supplemental or extra channels in addition to the primary HD channel (which simulcasts the station's analog signal). Assuming that you plan to offer a music format in stereo, most people familiar with this issue believe that only one supplemental channel is possible at this time without significant degradation of audio quality. With talk or information (traffic and weather) channels requiring less bandwidth, two supplemental channels would be possible. At some point in the distant future when we no longer broadcast an analog signal, there would be the opportunity for up to eight digital channels on a typical FM frequency.

The issue at hand is where these supplemental channels will be placed on the FM band. The design that is available on a limited number of sets is the "layered approach." Under this system, each supplemental channel being broadcast on an FM frequency would be appear "under" the main analog channel of a station. For 88.1 they would be labeled 88.1.2, 88.1.3, etc. A number of broadcasters led by Cox Radio are proposing a system that would "expand" the FM band, moving all the supplemental channels above 107.9. Each supplemental channel would stand on it's own and be labeled accordingly. For example, the supplemental channels for 88.1 under this scheme would be 108.1, 128.1. 148.1, etc.

In the spirit of full disclosure, we at Cox "have a dog in this hunt" and strongly believe in the expanded band approach. I have attached a one sheet that outlines (in our opinion) the advantages of this numbering system. I have also attached an | amusing jingle | that makes the point on how confusing promoting a supplemental station under the layered approach will be. Having admitted our bias, we feel strongly that the ultimate users of this technology, the listeners, should have a chance to weigh in. As I said at the meeting, none of us would venture into a serious format change without research and we shouldn't move forward with this very important development in the future of our business without researching the opinions of the end user.

Our Proposal:

Cox plans to fund ten focus groups of with a minimum 100 person total split by demo and 1/3 of the participants classified as "early adopters." The groups would be held in a radio company HQ neutral city moderated by an independent researcher. During the groups, at least three variations of the ID proposal would be tested. Subject to limitations, key executives and others would be able to view the groups live. We also plan to make them available by web cast and the research findings would be made public. We would also invite participation from key players into the research design and city selection.

As I write this email, we have just hired Bob Harper, a very respected researcher and we believe, one of the best when it comes to focus groups. The city that tops our list is Detroit because it is home to many car manufacturers, it was suggested by receiver people to help them engage their automotive customers, and we hope we can get some of them to attend.

Our timetable is to have this project underway in the next 30 days with results available in early December.

What I Need From You:

1. Please let me know by email if you "have an interest" in this research project. (We are not asking for money, just your interest and the involvement of your company in the process.)

2. Would you or a high level representative from your company be interested in attending any of the focus group sessions?

3. Are you interested in helping us with the research design? (Screener and discussion guide drafts will be sent to you for comment if you let us know.)

4. Do you have an opinion about which city to hold the groups in?

5. Do you have any additional input for us as we move forward?

If you could take a minute and respond to these questions and add any other input you believe would be valuable to this process, I would truly appreciate it.

I would also like to emphasize that in no way do we wish to slow down the rollout but we do want to do everything possible to make sure HD Radio is Consumer Electronics hit.

I will keep you up to speed as we move forward with the project. Thanks for taking the time to help us with this very important project.

Best,

Dick Ferguson
Cox Radio