Classmates.com 2008 Annual Report Download - page 8

Table of Contents
Providers of floral network services typically offer a broad range of services that are designed to promote revenue growth and facilitate the
efficient operation of a retail florist's business, including the ability to send, receive and deliver floral orders. Additional products and services
offered by providers of floral network services include: point-of-sale technology systems, branding and advertising services, credit card
processing services, e-commerce Web sites, and telephone answering and order-taking services. Certain providers of floral network services
have recently broadened their focus and developed new products, including branded fresh flowers and in-store floral displays, to appeal to
supermarkets and mass merchants which have increased their presence within the retail floral market in recent years.
Providers of floral network services that have a separate nationwide floral marketing business (such as FTD's and Interflora's consumer
operations) which generates a significant flow of consumer floral orders can potentially increase the value of their services by providing a strong
flow of consumer orders for fulfillment by florist members.
Classmates Media Segment—Online Social Networking
Online social networking is rapidly growing and evolving to include a broad spectrum of Web sites and online services. From a category
that attracted a relatively small number of users a few years ago, during December 2008, social networking Web sites attracted approximately
705.9 million unique visitors worldwide and an average of 240.4 million daily visitors according to comScore MediaMetrix, an Internet industry
research company.
We believe people have a fundamental drive to connect with others, be part of a community, express themselves and maintain personal
relationships. Core, life-long relationships are often based on enduring affiliations related to shared experiences such as family, school,
workplace, or military service. People seek to foster these relationships as well as other meaningful affiliations, such as those based on common
interests, hobbies and trends.
Affiliations based on school encompass large numbers of individuals. According to the U.S. Census Bureau, as of 2007, there were
approximately 189.0 million high school graduates living in the U.S., and approximately 118.9 million people in the U.S. who had attended
college.
Over time, people frequently lose touch with each other for a variety of reasons, including geographic moves and job changes. According to
the U.S. Census Bureau, approximately 39.9 million people relocate, and nearly one-third of America's workforce changes jobs, each year. In
addition, it is estimated by the U.S. Department of Labor that the average American worker will hold more than 10 jobs by age 40. We believe
there is a growing trend towards using new mediums of communication that facilitate social interaction and enable individuals to find and
connect with friends, family and colleagues.
Social networking Web sites fulfill a number of different needs, including allowing users to find, connect or reconnect with individuals
from their past and interact with new people based on shared interests, experiences, goals, or other criteria. Widespread adoption of broadband
Internet access, digital photography and online video has also served as a catalyst for growth in online social networking, facilitating the sharing
of content over the Internet. We believe that social networking users frequently choose to participate in, and develop affiliations through, more
than one online social networking service. These Web sites and services are used by individuals to, among other things, post content about
themselves and to review or comment on the content posted by others. Users of social networking services may interact and communicate
through email as well as through a variety of other online forums, including instant messaging, blogging, the posting of pictures and videos,
voice chat, and discussion groups. Many social networking services provide users with tools that enable individuals to identify, build and
maintain personal networks from their relevant affiliations.
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