Finnigan said, "These moves are the next step in our transformation of what were independent Internet operations at 32 different newspapers into one consolidated network and business unit.

"All projections are for a fast-growing Internet advertising market over the next five years, especially local advertising, and we are uniquely positioned to capture a large chunk of that business. Our approach leverages network-wide economies and creates an innovative formula for operating in large, medium and small markets."

He continued, "To become profitable by the end of 2002, and to be a major contender in today's Internet market, we need to focus on advanced product development, scalable technology, operational efficiencies, and extremely targeted and efficient marketing. In addition, these moves focus our resources on our highest yielding local markets and vertical products, like our CareerBuilder recruitment network."

In September, KnightRidder.com, along with the Tribune Company, acquired CareerBuilder, a leading publicly-traded online employment service, combining it with CareerPath.com.

The planned restructuring, Finnigan said, will enable KnightRidder.com to double the size of its online employment sales force in order to lead the recruitment space. Though Finnigan said the company is laying off 68 persons, nearly 16 percent of the current workforce, he added that 34 new positions will be created and filled. "As new fast growing opportunities emerge in the Internet advertising marketplace, like the employment area, we must evolve our organization quickly to take advantage, " he said.

Finnigan added, "Online recruiting is the fastest growing, and largest, online advertising market, expected to grow from $600 million this year to $4.1 billion in 2005. It provides 42 percent of KnightRidder.com's total revenue, and in recognition of that, we are concentrating more resources on pursuing it.

"Also, because of our large network scale, we can take advantage of new technologies to share resources across our markets, giving us a significant advantage in the local online marketplace."

Many of the organizational efficiencies are enabled by remote content management technology developed by KnightRidder.com. "Our technology enables newsrooms to choose greater flexibility and control over the content they deliver to our Web sites," Finnigan said. "This will ensure that Knight Ridder's journalistic standards are not compromised on the Internet.

"Our focus on CareerBuilder, and our focus on network scale, puts us on a steady course to profitability," Finnigan continued. "Our total revenues have grown by more than 45 percent this year, our metered audience is growing steadily and our online ad revenue is growing faster than the market as a whole. Increasingly, traditional, non-Internet advertisers turn to us and our Real Cities partners as stable and respected brands. We are delivering the viewers they are targeting and are on track to be profitable by the end of 2002."

Finnigan emphasized that every effort was being made to minimize the number of staff reductions and to help those affected in their transition. "This affects some very talented people, and we will do everything we can to support them through this change."

KnightRidder.com, a leader in local information and services on the Web and founder of the Real Cities network, is headquartered in San Jose, California. KnightRidder.com develops and manages the Internet properties of Knight Ridder (NYSE: KRI), the nation's second largest newspaper publisher. KnightRidder.com is a separate Internet subsidiary. Real Cities consists of a unique partnership network that brings together the best strengths of leading U.S. media and Internet companies including KnightRidder.com, Belo Corporation, E.W. Scripps, Macromedia, Inc., and Blade Communications. The result of this combined effort is a premier network of city and regional Web sites that consumers turn to for all things local.

Certain statements contained in this report are forward-looking. They are based on management's current knowledge of factors affecting Knight Ridder's business, and the company assumes no obligation to update any forward-looking information. Actual results could differ materially from those currently anticipated, depending uponÛbut not limited toÛthe effects of interest rates, of national and local economies on revenue, of the evolution of the Internet, of unforeseen changes in the price of newsprint and of negotiations and relations with labor unions.

Press Contacts:

Cynthia Mallen Funnell, KnightRidder.com, (408)938-6076, cfunnell@knightridder.com.

Maya Esparza, PRx Inc., (408) 287-1700, maya_esparza@prxinc.com.