BEAVERTON, OR—Citing artistic restlessness and a desire to "focus exclusively on what we do best," the Nike Corporation announced Monday it will cease manufacturing athletic shoes and other sports-related merchandise in order to devote itself fully to the creation of stunning, state-of-the-art television advertisements.

Once free from the distractions of making products, Nike plans to focus on creating the coolest ads ever.

"The last few years, it just became impossible to maintain our high standards of advertising while faced with the daily distractions of making sneakers," said Phil Knight, Nike founder and CEO. "By discontinuing our entire product line, we will be in position to ensure that Nike remains the world leader in the field of incredibly cool television commercials well into the 21st century."

Nearly 95 percent of Nike's 6,800 employees were laid off following Monday's announcement, with only those in the company's advertising and promotions divisions keeping their jobs.

Knight said he will offer the fired employees' combined salary of $210 million to basketball superstar and Reebok pitchman Shaquille O'Neal, the most prominent athlete not currently under contract with Nike. If necessary, Knight said, the shoe company will terminate long-distance runner Joan Benoit-Samuelson's $30,000 annual contract and add it to the O'Neal offer.

"Basically, we feel that there are a lot more important things in this life than selling shoes," Knight said. "When a Nike commercial ends, and that Nike swoosh dramatically appears on your TV screen, it means a lot more than 'Just Buy It.' It means 'Live Your Dreams.' It means, 'Make It Happen, Children Of The Earth... Find The Courage To Go Out And Make The Most Out Of Life.' I don't want that beautiful message of hope and inspiration tarnished by crass commercialism."

Nike's next project will be a 17-minute, $200 million spot scheduled to air during halftime of Super Bowl XXXII in January 1998. The commercial, which is being touted as "the most killer commercial of all time" by Nike officials, will advertise the imaginary new Air Gravitas basketball shoe.

The spot, set in deep outer space, will feature Warner Bros. cartoon favorite Wile E. Coyote, supermodel Naomi Campbell, and box-office mega-star Bruce Willis, as well as "kitschy" cameos by 1960s television icons Adam "Batman" West and Barbara "I Dream Of Jeannie" Eden. The digital effects and hyper-realistic alien space-battle sequences in the new ad are said to represent major breakthroughs in special-effects magic, requiring the construction of a Nike supercomputer and over 35 kilotons of pyrotechnic explosives.

In the ad's climactic finale, Knight said, the nation of Iceland will actually be destroyed.

"In the past, with so much of our budget going toward things like research and development, and employee salaries, a project like this would not have been feasible," Knight said. "Now, from a financial standpoint, our ability to inspire the world's athletes through a barrage of arresting visual images and high-volume rock music is almost limitless."

Nike spokespersons are confident the new ad will be the finest the company has ever produced. "Let's just say that, if the Air Gravitas actually existed, everybody in the world would want a pair after seeing this commercial," Nike director of corporate communications Dwight Haselrig said. "If we were actually selling the Air Gravitas, it would go down as the best-marketed and best-loved athletic shoe in history."