• Ad Age, Monday, November 12, 2007 12:32 PM

Last week, CEO Barry Diller announced that he was splitting IAC, the Internet empire, into five separate public companies. Critics said the move was proof that the media conglomerate approach doesn't work in the digital age. Ticketmaster, Lending Tree, home-shopping channel HSN and time-share travel business Interval International are branching off on their own. The rest, which includes search engine Ask.com, dating site Match.com and CitySearch, will continue to fall under the IAC brand.

Diller reveals that more than 50% of the scaled-down company's revenue will come from Web advertising. Today, that figure is only 9%. But why the faith in Internet advertising, especially during a time when the economy looks to be on its way to recession? "More than any media sector, I think the Internet will hold up," Diller says. Would IAC make a play for AOL if Time Warner makes it available?

Says Diller: "AOL is great opportunity for somebody. When and if Warner doesn't want it, I'll certainly be at the door."

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