Citi Media: Barry Diller, Chairman, CEO of IAC: Spinoff On Track For Early Summer

Barry Diller opened up his presentation at Citigroup’s 18th Annual Global Entertainment, Media & Telecommunications Conference in Phoenix, AZ, talking about the turnaround for its retail property HSN and the health of Expedia. He then turned toward this fall’s decision to split the company off along five lines: IAC (NSDQ: IACI) (, CitySearch, et. al.), HSN, TicketMaster, Interval International (vacations), and LendingTree.

The Spinoff: As he said when the split was announced, Diller expects the spinoff to be complete by sometime during Q2, preferably early summer. Diller: “Each of [the companies] are well-managed, they don’t need me. I want to concentrate on HSN, Expedia and Ticketmaster.” Is there risk of the loss of certain benefits of bundling the companies together? Diller says, yes, but not for another few years. “It wasn’t very efficient, you have to keep mining it and mining it until the natural stuff started flowing. I don’t think you’re going to see these companies in the same configuration two, three years out.” And that’s when the natural synergies will emerge, Diller said, creating new opportunities for potential partnerships among its former parts. The business has achieved year-over-year revenue growth, but Diller concedes, it has failed to achieve share growth in the face of the dominant Google (NSDQ: GOOG), which also has an advertising agreement with IAC.”The challenge this year, is to get people to try it, experiment with and then adopt it. That’s where our efforts are going.” He’s focused on “vertical searches” and other marketing ideas that will be different this year.

Mobile search: “It’s over-hyped right now. We’re out there with a great product, AskCity.It’ll tell who makes a great burger and it’ll walk you there. But nobody’s using it. The growth of mobile search is not going to happen as part of an explosion, a slow change in usage as screens get better and fingers become more adaptable. Will it be as Bill Gates says, where it’ll be voice activated? We’re at least two- to five years from real change in that area.”

Video ads: Pre-roll will continue to reign supreme for streaming video over the next few years. “You’re going to have to pay through your eyes and patience. It is inevitable.” In terms of how much online video advertising will ultimately resemble TV, in its use of pods, Diller is uncertain. It’s more likely that newer forms media buying will quickly evolve. During the Q&A, Diller elaborated: “being able to get an elevated search is mandatory for video. In the next year or two, you will see development in video search tools that will master this array of options that you’ve got.”