At this time I would like to welcome everyone to the CNET Networks second quarter financial results conference call. (Operator Instructions) Ms. McLaughlin you have may begin your conference.

Thank you and good afternoon. Before we get started, I would like to remind you that this call is being webcast. The webcast and second quarter slide presentation can be accessed on the CNET Networks investor relations website at ir.cnetnetworks.com. A replay will also be available shortly after the conclusion of this call. I would 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 expectation of future financial performance, including statements concerning future revenue, expenses, operating income, earnings per share and certain expected tax benefits, as well as statements regarding our growth prospects and expectations concerning the future success of our products and services. Any forward-looking statements made as part of our news today is subject to risks and uncertainties that could cause actual or predicted results to differ materially. These risks are outlined in our second quarter news announcement as well as in the company's Securities & Exchange Commission filings including its 10-K for the year ended December 31, 2006 and its 10-Q for the quarter ended March 31, 2007 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, July 26th, 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 use in our news release and on this call to GAAP financials on the last pages of today's news announcement, as well as in the slide presentation that accompanies this call, both of which 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-answer session. To facilitate the question-and-answer session we will be muting the line following each question and will not be taking follow-up questions. Now let me turn the call over to Neil. It’s Time to Buy Growth Again: Value investors have had a great run. But today’s smart money is buying GROWTH. Motley Fool co-founder David Gardner is way out in front of the herd. David’s still bullish on CNET and already a half dozen of his recommendations have doubled since October 2004. Discover what David’s recommending to his subscribers NOW in his new stock research report, “6 Picks for Ultimate Growth!”

Neil Ashe: Thanks, Cameron and thank you all for joining us. It is our pleasure to discuss our second 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 some of the most important online media brands in the world, serving over 137 million people, CNET Networks is uniquely positioned and has the foundation to thrive in the evolving media landscape. As I have stated on previous calls 2007 is a year of transition for CNET Networks. We have made and will continue to make the changes that are necessary to execute on the opportunity that we see in front of us. This will take time, but will position us for long-term success. Highlights of our second quarter are as follows: Total revenues were $97.2 million, up 5% from the year-ago quarter. Excluding businesses closed in late 2006 from the year-ago quarter, total revenue increased 8%. As we discussed with you last quarter, we are seeing weakness with some of our large technology advertisers, particularly with a few PC-related accounts. This is impacting our growth for the quarter, particularly evident in slower than expected U.S. media revenue. Also as we discussed last quarter, we have reduced our focus on WebShots; as such we have accepted year-over-year revenue declines at this property which are also impacting our growth. Our international business exhibited very strong growth during the quarter. Excluding closed businesses and the positive impact of foreign exchange, our international business grew 25%. The number of people visiting our sites continues to grow. Over 137 million monthly unique visitors to our properties during the quarter, up 18% year over…

(Operator Instructions) Your first question comes from Lev Belinski - JP Morgan. Lev Belinski - JP Morgan: If you could talk a little bit about, I know you have talked in the past about moving away from talking about page views. Can you talk about the impact of how a more Ajax-based interface for various sites is having on your usage metrics? And to what extent you are targeting user minutes and how that is going. Neil Ashe: Sure, as we have discussed and I think it has been widely acknowledged in the press and other communities over the last little bit, users are really the most important statistic that we focus on at this time. Page views per user have gone down. In our case, that is the result of new technologies like Flash, new content models like video and to a certain extent, Ajax. We are, as you indicated, starting to focus more and more on time spent. So across our network, excluding WebShots in this quarter, I believe time spent was up 9%. So over time, each of the different engagement metrics we will be focused on, but the most important of which is unique users. So as I said, those were up 18% year over year.

Your next question comes from Heath Terry - Credit Suisse. Heath Terry - Credit Suisse: You mentioned how your non-CNET businesses are doing. Does that give you any more motivation to start to spread out to other areas that you are not in right now as far as content goes? To the extent that you can talk about areas that you feel might be underserved or niches that you could fill, or at least how you are going to think about targeting those areas in the future, I would appreciate it. Neil Ashe: As we have said in the past, I think we are a unique demonstration of the ability to build multiple brands in different areas successfully, as ranges from our recent launches such as BNET in the business media space to Chow in the food space; and then going back a little bit to the entertainment and lifestyle properties like TV.com, MP3, FilmSpot, et cetera. Our criteria for evaluating whether or not we want to enter a category is first, do we believe that there is a passionate user interest? So is this consistent with our other properties in that it is something that people care enough to go to the place where they can tell the difference. The second is obviously, is there a market or interest in the category if we build it? Finally, do we think that we can do it better? That has guided our horizontal scaling that we have done over the last several years, and the properties that we have entered into. We continue to see strength against the properties we are building right now. TV.com obviously is a little over two years old now and is approaching 20 million monthly unique users and has been a real success for us. We see continued opportunity in entertainment and some adjacencies in entertainment, as well as in the lifestyle areas. So Chow and Food, Urban Baby, in parenting, we see other lifestyle categories where we can build upon that. Most importantly, perhaps though, we also see the ability to continue to expand the brands that we already have. So you are starting to see us expand our programming at places like CNET with CNET TV and with the different beats that both our award-winning editors as well as our blog network are covering. In addition to expanding to new brands, we will continue to expand the coverage of the brands we already have, which is, we believe, a great opportunity to bring more content to our users as well as going forward, take our content out to more users. So we see strong expansion opportunities within the current brands as well as in the new categories that I described.

Your next question comes from Anthony Noto - Goldman Sachs. Jenn for Anthony Noto - Goldman Sachs: My question really revolves around what is required to get marketing services revenue to accelerate in the back half? If you could talk a little bit about the trends you are seeing and what you think will change? Neil Ashe: Obviously the back half of the year is always the stronger, specifically the fourth quarter is the strongest quarter for us. We have underlying strength in the business right now in some of our core categories like consumer electronics, some of the tech categories beyond the PC related accounts that we discussed. As well as against video games and I believe that the combination of those plus increased execution against our general consumer advertising efforts can improve the back half of the year.

Your next question comes from Bill Lennan – First Albany. Bill Lennan – First Albany: The Google revenue is a bit surprising, if we take the percentages you gave last Q2 and this Q2 and in fact, Q1 this year Google revenue looks like it is down sequentially and up modestly year over year, which is surprising to us. I wonder if you can explain what is going on there? The second question is, the news is not all bad if you have got unique users up anywhere from 18% to 20% depending on which quarter you talk about, and you have got people spending more time on your properties. That is what media is all about. So can you talk about the selling process? How do you go into meetings now and sell these metrics in a world where page views are becoming less relevant? Are people still clinging to page views when you go and try to talk to clients? I guess the short version of that question is, you have got some great metrics going on but the revenue doesn’t seem to always reflect that. So how do you sell the good things at CNET? That’s it. Thanks. Neil Ashe: Sure. I will hit the first question about Google revenue. Google revenue for us, with the exception of the first quarter of this year, has always been right around 10% of revenue. As we said in the last quarter, we tried some optimization techniques in the first quarter which yielded some positive results that we didn’t expect to continue. So Google revenues are now back in line with where they have been historically. On the more important question, how do we sell the network and how do we present CNET Networks? Quite simply, CNET Networks accumulates the…

Your next question comes from Gordon Hodge - Thomas Weisel and Partners. Gordon Hodge - Thomas Weisel and Partners: Some of us are very optimistic that the video game cycle will start to turn up, and with it will come additional advertising after a drought year last year. I am curious if you are starting to see any signs of that as we get towards the fourth quarter, here. I am also curious if your guidance, which I think before had assumed a pick-up in the business, is still at the high end it seems related to either video games or a recovery in the PC space. Then I had a question on international, it grew nicely. I am curious how much of that was organic? Also, international traffic that you aren’t monetizing because it actually goes to your U.S. site. I am wondering if you are able now, if you have more bulk overseas whether you are able to funnel that inventory and sell it. Thanks. Neil Ashe: I will try and take three of these and then I may hand it off to George for some. So first on the video game cycle, there are some important titles that will be released in the fourth quarter of this year, and I believe the conventional wisdom in the video game industry that 2008 should start to see the pick up. As our performance to date is a little skewed in that E3 was in the second quarter last year and then the third quarter this year; if you normalized it, we are probably in the double-digit growth range on video game sales. I believe that we continue to take share in video game sales. I believe that we will perform better or continue to perform better as the industry…

Your next question comes from Mark Mahaney – Citigroup. Mark Mahaney - Citigroup: Can I just ask a basic question about the change in guidance in the back half of the year? I think you have implied this or maybe I missed it; you are essentially bringing down your guidance. Is it the WebShots revenue decline year over year? So you had already expected that to get weak, but it is getting weaker more rapidly than you had expected? Or are there other places? If you could just tick off two or three reasons why, just in the back half of the year, why your outlook came down a little bit? Thank you very much. Neil Ashe: The quick overview on our view on guidance right now is that 5% to 11% growth for the year and greater than 20% EBITDA margins for the year. What has changed between now and the first quarter is typically as it relates to really the items that we called out when we set second quarter guidance. Where some weakness, to get specific, non-tech accounts and secondly related to WebShots. As I believe Gordon asked in the last question, we expected or we took some risk, frankly, in the first quarter that we would improve throughout the rest of the year on each of those specific items and that we would make up for the WebShots revenue, frankly, with other things. Now we are not assuming that, we are assuming that our current run rate is basically where we finish the year. So as I said in the last question, we are trying to provide you with the best information we have at this point in time. I would like to emphasis though, as it relates to guidance, that it is not changing how we run the business. Our objective here is to make this company as valuable and to make this company grow. That really is our focus. What we are using guidance for is to try to provide you as much transparency as we can to exactly where we are at this point in time.

Your next question comes from the line of Bill Morrison - JMP Securities Bill Morrison - JMP Securities: I was wondering if you could comment a little bit on what exactly is ailing the PC industry? When you talk to your customers, what are they telling you for the reasons and that they are either lowering their spend with you or lowering their spend across the board, particularly given, I think that most of us probably expected tech to be strong this year with the Vista cycle. If you could comment on that. I was wondering if you could give us maybe a little bit of visibility into the size and growth of kind of your non-tech properties from a revenue scale perspective so that maybe we can understand when some of the high growth businesses like Gamespot, et cetera, might begin to drive an acceleration in the overall business? Thanks. Neil Ashe: First, why is PC advertising spending lower? We have called out and to be real specific about this, I believe this is first of all an industry-related phenomenon, and that is that the PC business is not the same growth business it was during the last cycle. So that's pretty fundamental. That has ramifications for lots of folks. Margins are not expanding. In fact they are decreasing. You are seeing cuts at places like the PC manufacturers. I think you have written extensively about your views on then Intel Inside program. Clearly that's a catalyst for the industry, but I know it's a not the direct effect on us. There also have been other changes at some of these large accounts. Reorganization, refocuses, cost-cutting measures to realize their numbers. I believe that we all had hoped for a Vista rebound, and I think the reality is that…

Your next question comes from the line of Mark May - Needham & Co. Mark May - Needham & Co.: Thanks for taking my questions. Sorry to go back on the guidance again, but I want to approach it from a slightly different angle. The implied numbers for Q4 imply a pretty significant ramp in revenue, I think at the mid-point of the ranges, it's like $30 million in incremental revenue sequentially, like a 30%-plus sequential increase in revenue. I think it's over 30% EBITDA margins in the fourth quarter. That's something that I don't think the company has done in quite sometime. Just wondering what gives you the confidence that you'll see that sort of growth and margin leverage in the quarter? The other question is, you made some divestures last year. Do you have any other plans to streamline the business or restructure anything within the business going forward? George Mazzotta: I'll take the first question around guidance. We're not going to provide you with specific guidance into Q4, but what is implied in our Q3 and full-year revised guidance is a range around which we believe we can comfortably operate. The seasonality is such that Q4 implied would equal the proportion of the year in 2007 as it was in 2006. So I'm speaking in generalities here, so as to stop short of providing specific guidance for Q4, but I want to emphasize the seasonality implied is very consistent with prior years. Neil Ashe: I would suggest you check your math on the 30% growth in the fourth quarter there. As a percentage of the year, I think it's 30% but it doesn't imply 30% growth. As it relates to the assets we own, either that we would consider divesting and/or that we are going to add to, our perspective on that is first of all we start with the strategic importance that that asset provides to us. Secondly, does it meet and/or exceed our financial expectations? And then third, what is the market value of any of those assets? So that is the evaluation process that we determine both to buy as well as we consider whether we should sell or divest some of our properties. We have been aggressive acquirers of properties over the last several years. I would expect that to continue into the future. We will be equally as diligent about recognizing properties and/or businesses that may not fit with us going into the future. So nothing specific on the horizon, but that's how we approach the thought process, and we are equally as likely to move around assets by either selling or buying.

Your next question comes from the line of Kit Spring - Stifel Nicolaus. Kit Spring - Stifel Nicolaus: Can you talk about how you are doing so far in the third quarter? I think the guidance is pretty wide, plus 2% to plus 10%. That seems really wide. Maybe how you are doing, and what might swing the guidance that much? Maybe just a little bit more on why you think it's tech weakness versus your declining page views? Just any evidence or do you have evidence that other people in the sector are seeing weakness or could it possibly be that these tech companies are diverting less money to you because of your declining page views? Thanks. Neil Ashe: The first one, how are we doing so far in the third quarter? As of July 26th, we feel pretty good about the third quarter. We are, as I said and I think it bears repeating, our perspective on guidance is we would like to provide to you as clear and transparent a view of where we think we are. I believe that oftentimes it can be an unnecessary distraction to try and overly pinpoint guidance, and it takes away from the time spent on managing the business. I would like to reiterate again and I will when given any opportunity, that our focus is on operating the business as aggressively as we can to build value both for now as well as in the future. So our guidance so far for the third quarter specifically is as transparent a view as we have right now. Secondly and I believe we have talked about this before, Kit, the effect of page views on revenue. We have been consistent on this for a while now, even when page views were going up, that this was for us and the industry that this was a less relevant statistic than it was being accorded in the vernacular. That's been borne out. I believe each of the third party measurement companies this quarter, COMScore, Nielsen, indicated that they were going to de-emphasize page views because they weren't as important. At the end of the day you have users who are engaged who are attracted to your properties because in our case we provide them a thoroughly engaging experience which satisfies their desire to participate in something that they are passionate about. When we bring that audience together we offer the highest quality advertisers in the world the opportunity to message, in an authentic way with those users. With users up 18% year-over-year time spent up 9%, the health of our properties continues and will continue in to the future.

Your next question comes from the line of Youssef Squali – Jefferies. Youssef Squali – Jefferies: Thank you very much. Neil, I was wondering if you could tell us what Yahoo talked about in terms of growing interest in non-premium inventory, kind of at the expense to the higher quality one has had any negative effects your business, particularly when it comes to this PC account business that you had talked about as being a little weak. Can you also speak a little bit about the pricing environments, what have you seen in the last six months, in particular CPMs? Neil Ashe: First, I would break quality of inventory into basically three different buckets, which is kind of lower-quality inventory, what Yahoo! calls premium inventory would be a middle tier, and then what I believe is our quality of inventory in a tier above that. I believe that there's been tremendous explosion of supply and inventory in that first category which is the lowest rung, and that is the communication vehicles as we have talked about in the past, like a Facebook or a MySpace, et cetera. Among the bulk inventory, optimized inventory, I believe there is tremendous competition. Our CPM performance across the network over the last quarter and indeed over the last six months has basically been flat. So across the entire network, our CPMs have held constant over the last six months. So we're not seeing the same CPM pressure that Yahoo! describes. I believe that's because our brands are truly in a different class of premium than the front doors of different categories at any portal. As I described earlier, that's how we go to market, and that's how we're paid today.

Your next question comes from the line of Brian Fitzgerald – Banc of America. Brian Fitzgerald– Banc of America: Your Google deal expires at the end of this year. Any update on the negotiations? Second, when do you think your participation in the Fox distribution platform might become impactful? Thanks. Neil Ashe: We have a great relationship with Google. They have been a good partner of ours for several years now. We also have good relationships with Yahoo! and MSN. Our Google deal does expire at the end of this year, and so obviously we'll work to extend that and/or find alternatives. As I said in the past, we're certainly not going to negotiate this in public but we are confident in the quality of our search traffic and expect that we'll have an interesting deal with Google and/or with somebody else going forward. The second question on the new site joint venture, it's scheduled to launch in the fall of this year, so I would expect us to be participating both as I said earlier as a content contributor, as well as a distributor at some point in the fourth quarter most likely.

We have reached our allotted time for questions. Are there any closing remarks? Neil Ashe: First I would like to thank you all for your continued support and attention that you pay to CNET Networks. As I said we are diligently working to increase value over time to make this business a lot larger and a lot more valuable, and we appreciate you taking the time to learn more about us. We look forward to talking to you next quarter. Thank you. It’s Time to Buy Growth Again: Value investors have had a great run. But today’s smart money is buying GROWTH. Motley Fool co-founder David Gardner is way out in front of the herd. David’s still bullish on CNET and already a half dozen of his recommendations have doubled since October 2004. Discover what David’s recommending to his subscribers NOW in his new stock research report, “6 Picks for Ultimate Growth!”