Good afternoon. My name is Keshena and I will be your conference operator today. At this time, I would like to welcome everyone to the CNET Networks First Quarter Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. (Operator Instructions) I would now like to turn the call over to Ms. Cameron McLaughlin, Director of Investor Relations. Ma’am, please go ahead.

Thank you, and good afternoon. Before we get started, I would like to remind you that this conference is being webcast. The webcast of first quarter live presentation can be accessed on the CNET Networks, Investor Relations website at ir.cnetnetworks.com. I’d also like to remind you that in the financial news announcement released today and also on this call, CNET Networks is providing specific forward-looking statements including guidance related to our expectations of future financial performance. Any forward-looking statements made as part of our news today are subject to risks and uncertainties that could cause actual or predicted results to differ materially. These risks are outlined in our first quarter news announcement, as well as, in the company’s Securities and Exchange Commission filings, including its 10-K for the year 2006, which can be obtained from the SEC’s website or directly from our Investor Relations website. All information discussed on this call is as of today, April 26, 2007 and CNET Networks undertakes no duty to update this information. Last but not least, you can find a reconciliation of the non-GAAP financial measures that we used in our news release and on this call to GAAP financials on the last page of today’s news announcement, as well as, in the slide presentation that accompanies this call, are located at our Investor Relations website. Hosting today’s call are Neil Ashe, CNET Networks’ Chief Executive Officer and George Mazzotta, our Chief Financial Officer. Following their prepared remarks, we will have a brief question-and-session session. To facilitate the Q&A session we will be muting the lines following each question. Now let me turn the call over to Neil.

Thanks, Cameron, and thank you all for joining us. It is our pleasure to be able to discuss our first quarter results, our progress and our outlook for the future. CNET Networks is a different kind of media company. We continue to demonstrate our ability to build and grow media brands for people and the things that they are passionate about. With the multiple brands serving multiple people in multiple areas of passion, CNET Networks is uniquely positioned and has the foundation to thrive in the evolving media landscape. Highlights of our first quarter are as follows; total revenues were $92.1 million, up 10% from the year ago quarter. We saw user growth and solid financial performance from our CNET Entertainment and International business units. Our growth was offset by revenue weakness at Webshots and some developing softness in the technology category. We will cover this in more detail shortly. Operating income before depreciation, amortization, stock compensation and stock option investigation related expenses was $11.8 million for a profit margin of 15%. We have made progress on the construction of new team. I am pleased that so many talented individuals would like to join CNET Networks. We have filled the head away chart and general counsel roles, and they will be joining us in the coming weeks. We will provide more details at that time. Also, we announced that we have added two new members to our Board of Directors, Susanne Lyons who is the Chief Marketing Officer, of Visa USA and Mark Rosenthal who is the CEO of Interpublic Media and the COO MTV Networks. We are confident that their expertise in brand building, advertising and media will help us continue to grow CNET Networks and our brand. 2007 will be a year of transition for CNET Networks. We have made, are making and will continue to make all that is necessary to execute on the opportunity that we see in front of CNET Networks. Let me turn it over to George to bring you up to date on our financial picture, and after that I will provide more insight into our initiative and our outlook.

Thank you, Neil. Total revenues for the first quarter was $92.1 million, an increase of 10% from $83.17 million last year. Revenue growth was driven primarily by strength in marketing services revenue. As we discussed in our call last quarter, we exited our events business in China and the UK, our media operations in Korea and our EDventure business in the US during the fourth quarter of 2006. Excluding this closed businesses from our 2006 results, total revenue during the first quarter would have grown by 15%. Marketing services revenue grew 13% year-over-year to $80.4 million driven mostly by strength in our CNET Entertainment and international properties offset by weakness in our Webshots property. Excluding closed businesses, marketing services revenue would have grown 15% from last year. Licensing fee and user revenue during the first quarter declined by 6% year-over-year to $11.7 million due largely for the closure of our EDventure business which recognized a significant portion of its revenue in the first quarter of 2006 from the PC Forum event. Excluding closed businesses licensing revenue would have grown 13% from last year. Supporting our revenue growth is a stable and expanding advertiser base across the entire network our top 100 US customers represented 57% of total revenue. We also experienced a high renewal rate from our top advertisers as 96% of our top 100 US customers that did business with us in the fourth quarter renewed with us in the first quarter of this year. Google search revenue represented nearly 12% of total revenue for the quarter. On a segment basis, the US Media revenue increased 10% to 74.2 million. Excluding closed businesses, the US Media revenue would have grown 13%. International revenue increased 12% to 17.9 million during the first quarter. International growth was driven by strength and…

Thanks George. As I said last time we spoke, 2007 will be a year of great activity for CNET Networks. We remain focused on realizing the potential and opportunity of our existing brands, and doing what we do better and on identifying and capitalizing our new opportunities. We will continue to expand our footprint. We are uniquely positioned to play an important role in the evolving media landscape. Since our inception, we have been innovators in content models and user experiences, and we have more people visiting our sites than ever before. During the first quarter, we attracted nearly a 144 million monthly unique users, up 23% from the first quarter of 2006. This places us among the top ten largest Internet companies in the world. We create engaging user experiences and are focused on staying at the cutting edge for our users and marketers while leveraging innovative technologies in emerging media to cost selling improve our properties. We continue to generate, fund and promote emerging media to deliver on the user promise of our brand. The ZDNet blog network continues to grow and we are constantly exploring new ways to include independent content producers on our properties. We have scaled the amount of video and audio and we have streamlined the usability of several sites including CNET and Webshots by reducing the number of pages that a user needs to click while either reading a review or uploading photos. During the quarter, CNET Network’s users turned over 81 million page views per day. Our users are engaged and active on our site. We served nearly a 1000 pages per second and later this month the GameSpot will service one billionth video stream. In the hour that we spent together today our properties would have generated over 3.5 million page…

Thank you. (Operator Instructions) We’ll pause for just a moment to compile the Q&A roster. Your first question comes from the line of Anthony Noto with Goldman Sachs

Thank you very much. Neil a couple of questions. I was wondering if you could comment on your organic revenue growth for the overall company, and then within the context of that, what's the revenue growth at cnet.com, news.com and download.com? Thank you.

So, we don’t break out individual properties, so we can’t break out the CNET revenue growth, total revenue growth as we pointed out would have been 15% year-over-year excluding the closed businesses in that first quarter.

Your next question comes from the line of Youssef Squali with Jefferies and Co.

Thanks. This is Peggy Frango for Youssef. Could you talk a little bit about demand for lower priced inventory items? Are you seeing more of that as we heard something off with this quarter, and also could you talk a little bit about how you monetized non-premium inventory and whether you have participated in an ad exchange? And just one other question: You haven't announced any acquisition this quarter. Could you just talk whether that was a function of the quality that you are looking at evaluations or anything else? Thank you.

Okay. So we will pick through them in the order that you ask them. So first for demand for low CPM inventory. The overall predominance of our inventory is high quality inventory. So we don't -- when -- when others are selling kind of pure rented inventory we have less of that than would be considered in other areas. So we don't have the same trends around things like email inventory and others. We monetize almost all of our own inventory. So we do participate on a limited basis with ad networks for rented inventory and for Webshots. But we strongly believe that we are best at selling our own network, that our properties are incredibly valuable, and that they generally provide more value to an ad network than ad networks provide to us. While we continue to test how to most effectively optimize that monetization currently that's almost exclusively done with us with some minor exceptions. The third question on acquisitions in this quarter, we completed the acquisition of GameKult in France which we had talked about on the last conference call. We have no shortage of backlog of acquisitions that we are seeing, and we are focused on finding those which can either improve the operations in any one of our properties or markets or launch us into new areas. As I said in my prepared comments we feel like we have proven the ability to both build properties, as well as buy properties, as well as do a combination of building and buying to enter new categories, and we continue to focus on expanding our footprint.

Your next question comes from the line of Gordon Hodge with Thomas Weisel and Partners.

Just a few questions Neil. Let's see one; if you look at the Q2 guidance, and you have got expenses up, it looks like sort of 14%, 15% year-over-year, and then revenue up 5% to 10%. I am just curious what sort of things or initiatives do you have in mind for Q2 that would cause expenses to outrun revenue growth? And then on the -- you observe in the press release at page – these are down 18%, up 1% excluding Webshots, but users are up a bunch and I think the ComScore data would suggest the time spent with your properties is also up significantly. How do you reconcile the different direction of page users going versus time spent and can you confirm the time spent with your properties is actually up nicely? Thanks

Okay, thanks Gordon. I'll take the second question first, which is we have that strong growth in users, and as we mentioned, as we continue to increase our usage of video or audio and other technologies, it will [stand] to reason that we will continue to increase our time spent. That’s not correctly a metric that we managed to hear, so we spent the last on that, but I'll give you some anecdotal evidence which is CNET TV did about 1.1 million users per month, and they, I think turn on average about six videos per time there. So you can see how that time spent will change pretty dramatically. We are focused in all of our properties on all forms of emerging media whether that's video, text, photos or audio, and we are focused on creating that experience which seriously satisfies our user promise. And that will lead to the engagement that we’ve described. As that effects second quarter guidance the revenue expectations in the second quarter are related to as I mentioned in the prepared remarks, some softness against specific technology accounts as well as our decision to scale back on Webshots. And this is I believe a one quarter phenomenon and not a permanent phenomenon, and we are making the changes that I outlined to position ourselves for long-term future growth in revenue on all of our properties.

And Gordon with respect to our suggested expense growth for Q2, this is a function of strategic investments that we have made in new and growing properties. If you look at our expense growth sequentially, you will notice that the mid-point of our guidance suggest that we would be actually be below levels of Q4 2006. Note that we examine regularly and with great interest the reinvestment rates in each of our businesses and in our corporate infrastructure. And we have the opportunity as Neil pointed out in his comments to both invest more aggressively in new and growing properties and to scale back in other areas.

Your next question comes from the line of Imran Khan with JP Morgan.

Yes, hi, thank you very much for taking my questions. Two questions, first, maybe high level. You have rolled out your sites in the international market, can you give us some color like how quickly you think you can get some traction in terms of growing traffic or revenue monetization whether you need to built a sales force desk separately. How are you trying to monetize the traffic there? And secondly I think you talked about strong technology advertisers, I believe that’s Intel. What gives you the confidence on the revenue number if some of the technology advertisers start cutting their spending, thank you?

Okay, so I'll hit those in the order that you ask them Imran. So first on international; so we have media operations in Europe and the U.K., France and Germany and in the largest markets in Asia including China, Japan etcetera. So as we roll out our U.S. branded properties we roll against a largely against an existing sales force. And while we may need to make additions to that, we're generally already [resident] in the markets. So we've seen strong growth in the market where you would expect us to, which are the U.K., China obviously and to a lesser extent France as we've introduced these properties in those markets. So the second question on weakness in technology advertisers and our confidence in our projections for the remainder of the year, we see our path to our existing guidance for the rest of the year. As I said in my prepared remarks, I believe that we can execute it better against specific accounts as well as continue to grow with some of our other properties and grow our revenues against those. So while the second quarter is not the kind of growth rate that we would like, we believe that we can through the changes that we've identified start to realize our expectations for the back half of this year, but more importantly for 2008 and beyond. We remain focused on building our properties which are some of the most important media brands in the world, and we believe that we can monetize to a whole host of advertisers where we need to scale our exposure and we are making organizational changes and we are doing what's necessary to realize that overtime. The trends for online advertising come to us, and the future of media is consistent with our strategy with the expectation of a branded user experience, and we are putting ourselves in a position to realize that that revenue in that value creation opportunity overtime.

Your next question comes from the line of Kit Spring with Stifel Nicolaus.

Isn’t that really your page view slowdown that might be impacting the slowdown in sales rather than the sales process? And what are doing to improve that page view, and what are you assuming for page views for the second half?

The short answer to your question is no. It’s not the page whose slowdown is effecting our growth and sales. We've been very consistent about this for the last three years in terms of our expectation about user growth and the relationship between monetization and realization of page views and/or other revenue generating opportunities like video etcetera. We have a non-linear relationship between our growth and users and usage and our revenue, so the output of that is RPM. So as you've seen our RPM has gone up or revenue per thousand pages. And so are, we are focused as I've said earlier on growing our users over the course of the rest of this year. In this quarter they were up 23%, and we expect them to continue to grow in the back half of the year.

(Operator Instruction). Your next question comes from the line of Mark Mahaney with City Investment Research.

Thanks. I wanted to ask couple of questions please. First, George, do you have any way of guessing what the option investigation costs are going forward? Can you [put] them in range or do you think the numbers in absolute terms will increase or decrease? Secondly house keeping question, marketing services, you gave that that growth rate was like excluding close businesses 15% in the March quarter, what was that growth in the December quarter? Can you tell whether its accelerating or decelerating? And then the last question has to do with that 23% unique user growth, is that organic number, are there international properties that have been added that have accelerated accruals or is there cleaner organic number to get at or is that it? Thank you very much.

I'll take the first question which was around our investigation fees. A terrific amount of effort was expended in the first quarter of this year to file our SEC reports, and to results the 409A issue related to the investigation. We will not speculate or provide an estimate for what it will cost to resolve the residual issues related to this matter.

I'll take the unique user growth question first. That’s a pretty clean number; the 23% is a pretty clean number. We added GameKult in France which is only about 2 million monthly unique users, 1 million to 2 million monthly unique users, so that’s not a big impact. So that is a clean almost exclusively organic growth number. In terms of the marketing services growth as we said first quarter excluding closed businesses was 15%, that's pretty consistent with where it's been for or where it was for the fourth quarter.

Your next question comes from the line of Heath Terry with Credit Suisse.

Just wondering, to go back to the discussion of IT advertising spending and the weakness that you are seeing there, can you give us an idea of what percentage, what portion of your revenues is actually represented by IT spending? And then if there are other segments of advertising that you are either seeing strength or weakness and could you talk about that? And then as we look at the outsized growth in RPM relative to the growth in page views. Can you talk to us about how that's manifesting itself, whether it’s a function of pricing within specific categories or if it’s more of a shift?

Okay. So I'll deal with those questions in order also. So first on the IT spending; we don’t break our categories as a percentage of growth. Although, as I pointed out in my prepared remarks we do still have large IT customers obviously. But they are largely centered around or our challenge in the second quarter is largely centered around those who sell PCs and the PC market. We'll not call that a broad based statement about the IT spending universe. Other segments where we are seeing strength and weakness, we are making progress in the auto category, games are starting to tick up. I think everyone expects 2008 to be a big year for games. And we continue to see growth among all of our properties in our penetration of general consumer advertisers. That is as you know still a smaller portion of our revenue growth side, but we still see some growth there. Our influence on research has really been a great tool for the marketing industry to understand what it means to create brand of properties that activate influencers and who those influencers are, and it allows us to really have a fruitful discussion with them about the power of our brands as an advertising medium for them. On the RPM growth, this is driven both by price as well as by sell through. So it’s pretty healthy across the board in those regards.

Your next question comes from the line of Bill Morrison with JMP Securities.

Hi. Thanks. I think you said Google was 12% of your revenue in the quarter, and if memory serves me correct it’s consistently better on 10% the last several quarters. Can you just confirm whether or not that's correct, and if so kind of what was driving the strength as a percentage of revenues there? And also can you remind us when that deal comes up for renegotiation? Thanks.

So yes, Google usually bounces around 10% of our revenue, and was 12% in the first quarter. We had a pretty good quarter on general optimization. So we are constantly evaluating our optimization mix and how we can change the mix of revenue to realize the most revenue. We found some ways to increase our revenue with an optimization in the first quarter with our Google relationship that we don’t expect to continue in the second quarter and we’ll find other ways. Our deal with Google, we are in the second of a two year deal, so it’s up for renegotiation this year for commencement next year and beyond.

(Operator Instructions). Your next question is a follow up question from the line of Gordon Hodge with Thomas Weisel and Partners

Yeah, thanks. Just a question George on stock compensation expense, not the investigation expense but the actual compensation expense. Is it embedded in there anything related to variable option accounting where you have options that or you win the money or whatever, that would inflate that number, in other words I guess the question is, is that a -- if we look from here over the next five years we would be looking at $23 million or so of stock option expense, or is there some things in there that might over time sort of diminish?

No, Gordon, albeit the current guidance that we have provided $23 million of approximate estimate for a stock compensation expense for all of 2007, you know, we believe in that guidance that reflects what we expect to expense, and there has not been that counter validity stock option investigation, relating to the compensation expense that would make that a volatile period in coming years.

Your next question comes from the line of Ursulla Morgan with Bear Stearns

Hi, it’s actually Ursulla Morgan at Bear Stearns. Forgive the housekeeping fresh whatever question, but did I hear correctly that for 2007 overall the adjusted guidance meaning taking away all of these unusual things, and the deferred taxes and stock comps and whatever else, that your guidance was a $0.29 to $0.39 range, I am not sure I got that correctly in my notes? And then could you comment on whether that is an apples-to-apples comparison to consensus because I see that the consensus for ‘07 looks to be 17 and for ‘08 25, and I just not at all comfortable that I am comparing like. Thanks.

Sure, I can I can speak to at least part of that question, I believe is, let me just re-read my comments, what we said was that excluding about $0.15 per share of stock compensation expense and a $1.23 per share of the tax expense benefit, and this relates to the valuation allowance relief of our differed tax asset which is about $190 million, we estimate. Our 2007 full year EPS spend would be about $0.29 to $0.39 based on the revenue and EBITDA ranges that we have provided, but on a reported basis, with all these things considered the full year EPS would be between a $1.37 and $1.47 per share.

Ladies and gentleman, we have reached the end of the allotted time for questions and answers. I would now like to turn the call back over to our presenters.

Thank you all for spending time with us. Thank you for your interest in CNET Networks, and we look forward to talking to you again next quarter. Thank you.

This concludes today's CNET Network first quarter financial results conference call. You may now disconnect.