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Table of Contents
PART I
Item 1. Business
OVERVIEW
Who We Are
IAC is a leading internet company with more than 50 brands serving consumer audiences across more than 30 countries... our mission is to
harness the power of interactivity to make daily life easier and more productive for people all over the world. The results of operations of IAC's
various businesses are reported within the following segments: Search, Match, ServiceMagic and Media & Other.
For information regarding the results of operations of our reporting segments, as well as their respective contributions to IAC's consolidated
results of operations, see "Item 7—Management's Discussion and Analysis of Financial Condition and Results of Operations" beginning on
page 26 and "Item 8—Consolidated Financial Statements and Supplementary Data" beginning on page 54.
Unless otherwise indicated, all references to "IAC," the "Company," "we," "our" or "us" in this report are to IAC/InterActiveCorp.
History
Since its inception, IAC has transformed itself from a hybrid media/electronic retailing company into an internet company. IAC was
incorporated in July 1986 in Delaware under the name Silver King Broadcasting Company, Inc., as a subsidiary of Home Shopping
Network, Inc. In December 1992, Home Shopping Network distributed the capital stock of Silver King to its stockholders. In December 1996,
the Company completed mergers with Savoy Pictures Entertainment, Inc. and Home Shopping Network, with Savoy and Home Shopping
Network becoming subsidiaries of Silver King. In connection with these mergers, the Company changed its name to HSN, Inc.
The Company acquired a controlling interest in Ticketmaster Group, Inc. in 1997 and the remaining interest in 1998. In 1998, upon the
purchase of USA Networks and Studios USA from Universal Studios, Inc., the Company was renamed USA Networks, Inc. From 1999 through
2001, the Company acquired Hotel Reservations Network (later renamed Hotels.com), Match.com and other smaller e-commerce companies. In
2001, the Company sold USA Broadcasting to Univision Communications, Inc.
In February 2002, the Company acquired a controlling stake in Expedia.com. In May 2002, after contributing its entertainment assets to
Vivendi Universal Entertainment LLLP, or VUE, a joint venture then controlled by Vivendi, the Company changed its name to USA Interactive.
In September 2002, the Company acquired Interval International. In 2003, the Company acquired the minority interests in its former public
subsidiaries, Expedia.com, Hotels.com and Ticketmaster, and acquired a number of other companies, including Entertainment Publications, Inc.
("EPI"), LendingTree and Hotwire. The Company changed its name to InterActiveCorp in June 2003 and to IAC/InterActiveCorp in July 2004.
On August 9, 2005, IAC completed the separation of its travel and travel-related businesses and investments into an independent public
company. In this report, we refer to this transaction as the "Expedia spin-off" and to the company that holds the travel and travel-related
businesses formerly held by IAC as "Expedia". Immediately prior to the Expedia spin-off, IAC effected a one-for-two reverse stock split. IAC
also completed the following transactions in 2005: the acquisition of IAC Search & Media (formerly known as Ask Jeeves, Inc.), the results of
operations of which are now reported within our Search (formerly Media & Advertising) segment (July 2005), a transaction with NBC Universal
in
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