Good morning, ladies and gentlemen, and thank you forstanding by. Welcome to the IAC Q3 earnings conference call. (OperatorInstructions) Now I would like to turn the conference over to Mr. Tom McInerney,Executive Vice President and Chief Financial Officer. Please go ahead, sir.

…forward-looking statements typically are preceded by wordssuch as “we expect”, “we believe”, “we anticipate”, or similar statements.These forward-looking statements are subject to risks and uncertainties and ouractual results could differ materially from the views expressed today. Some of these risks have been set forth in our Q3 2007 pressrelease and our periodic reports filed with the SEC. We will also discusscertain non-GAAP measures. I refer you to our press release and the investorrelations section of our website for all comparable GAAP measures and fullreconciliations. Joining me on the call today is our President and COO, DougLebda. Barry Diller had a conflict and was unable to join us today, but inaddition to today’s call, where Doug and I can answer your questions about Q3 andcurrent performance, just like we did last year, we’ll have another Q4 call inthe coming weeks with our full management team to talk about the going forwardstrategy of the company and our 2008 agenda. Let me make a few observations about our results and I willturn it over to Doug. We are pleased with the quarterly results. While theoverall growth rate is not what we aspire to, we had strong double-digit growthin enough of our businesses that we were able to post slight overall operatingincome before amortization growth for the quarter, despite a sharp decline inLendingTree’s profits. At HSN, we made the progress we had hoped for when we lastspoke to you. For the quarter, HSN grew revenue 5% with very consistent growthin each month of the quarter. While gross margins were down 140 basis pointsyear over year, for largely the same reasons we told you last quarter, this wassignificantly better than Q2, where we saw more than twice that rate ofdecline. We also made progress on the inventory issue, which hasplagued us all year, as we…

Thanks, Tom. I will spend a few minutes adding someoperational details of the financial results, beginning with retailing. At HSN,we are seeing definite signs of progress financially and operationally. Thebusiness now has a clear and differentiated brand identity and the workcontinues to increase the pace, newness, and variety of products on-air andonline. Q3 included exciting events like HSN’s 30th birthdaycelebration and fall fashion week, as well as HSN’s first national advertisingcampaign since 2002, all of which were unmitigated successes. Fall fashion week was sponsored by Elle Magazine, featuringtips and trends from their key editors on air every evening and resulted in thesale of over 42,000 Elle subscriptions, far exceeding our expectations. In addition to Elle, we are expanding our print coverage inthe fourth quarter to include sponsorships from Gourmet Magazine to feature ourchefs and Allure for our expanding beauty category. We are also seeing increased momentum in new vendors wantingto become part of HSN’s success. We recently launched entertainment guru ColinCowie and Dr. Robert Rey, a.k.a. Dr. 90210. Colin Cowy did over $2 million insales during his two-day visit with 25 sellouts. Dr. Rey sold over 13,000 unitsin one hour. Other product successes during the quarter included theworldwide exclusive launch of GE’s new digital camera on HSN, in which 10,000units were sold in just three-and-a-half hours, while Chef Todd English sold320,000 units of his new non-stick cookware in only 12 hours of airtime. This truly phenomenal production highlights the immensedistributive power of this medium when we strike the correct balance betweenproduct and presentation. We have more exciting launches and programmingconcepts planned throughout the fourth quarter. Most importantly, success is showing up in our customermetrics. During the quarter, our core customers grew 7% and on average spent 4%more with us. For the quarter, the total 12-month active customer file wasrelatively flat,…

(Operator Instructions) Our first question comes from theline of Justin Post with Merrill Lynch. Please go ahead.

Thank you for taking my question. Could you get into alittle bit about the lending provision? It was $8.2 million this quarter. Didyou up that for some of the loans that you had done prior to this quarter? Andhow comfortable are you with that provision? And then one quick follow-up onAsk.

The quick answer is generally yes. I mean, it does mention-- our business here is essentially originating loans and closing them andgetting them off the books, and the only cases where we have losses generallyspeaking is where there is an early default, usually in the first or secondmonth, something like that, or there is a fraud, there is a problem in the fileand you get into all sorts of specifics in terms of those contracts. So the losses in the business historically have been I thinkit’s fair to say astronomically low, kind of in numbers, 4 million cumulativelyof incurred losses over five years, which is 1.5 basis points of the total $26billion in production at LendingTree Loans over that period. So it’s really -- it’s a very different animal than anythingelse you are reading about in the papers. That said, in this environment, weare seeing, because of all of the unrest and dislocation with the investorcommunity and the people that have bought the loans, A, there are someincreased early defaults on those first or second months, and B, people arescrubbing when they do have a problem, they are scrubbing those loan files moreclosely than before and so we have seen people coming to us with one or theother of those problems, with a greater frequency. The majority of this is related to either no documentationor low documentation loans, or second mortgage positions and we’ve stoppedoriginating those roughly in the second quarter, but there is going to be atrailing -- there’s going to be a trailing flow to that a bit, so we arecomfortable with the reserve. We’ve scrubbed it very hard. Historically, because of what I was talking about earlier,the loan loss provision in any given period might be $1 million or somethinglike that. This is obviously materially higher than that, but we think it’s abit of a catch-up and unless something changes again, which is always possible,we think we have the right number.

Great, and then a follow-up on Ask; you’re seeing areacceleration in growth. Are you benefiting from some of the networkinitiatives at Yahoo! and Google? How do you feel about the core Ask website?Are you seeing an acceleration of queries on some of your recent changes?

We definitely continue to be helped by Google’smonetization. They do a really great job optimizing the ads that they serve andthat has certainly helped. We’ve obviously got our own initiatives, which havehelped do that as well, particularly our own Ask sponsored listings business,which continues to grow in the number of advertisers competing for thoselistings, and we can slot those in and that absolutely helps as well. On the Ask.com site, I mentioned that we are definitely verypleased with Ask.com. We are pleased with the growth in queries. We are pleasedwith the product and the infrastructure, we love the interface and next up isthe infrastructure, as I mentioned. As the infrastructure improvements arecontinuously rolled out and the responses and the search results are muchfresher and more accurate, we expect to continue to grow share in queries.

Our next question comes from the line of Anthony Noto withGoldman Sachs. Please go ahead.

Thank you very much. The acceleration in the Media andAdvertising line, a 40% year-over-year growth from about 32% last quarter, Iwas wondering if we could actually switch the perspective on that growth, assequentially it’s up 9%, which is a meaningful acceleration versus theseasonality of the September ’06 quarter. My question is, do you think that you get a one quarterstep-up due to improved monetization in September and then you go back to thenormal seasonal trend? Or do you think there’s continued benefits that canimpact the sequential growth rate seasonally over the next several quarters?

Anthony, it’s an incredibly -- as you can imagine, it’s avery complex equation which I think gives us, to a sense, a degree of lowvisibility on it. Because you have a number of moving parts in here. You haveobviously what’s going on, kind of on Ask.com proper, in terms of sitelaunches, in terms of marketing initiatives and the like. You have all of themoving pieces in the syndication side of it, both kind of distribution of Askas well as our syndication businesses. You have all of the initiatives in thetoolbar area, and as Doug said, we continue to drive a lot of innovation thereand we are getting very good growth. And then, of course, we’re a bit of a taker in terms of whathappens on the monetization side across all of those businesses under theGoogle agreement. So as we add all of that up and parse it in a milliondifferent ways, kind of judging its quarter to quarter and acceleration ordeceleration in any given quarter a trend is kind of virtually impossible. Allwe can say is we’ve got good and balanced growth in that business across all ofthose things I just mentioned and we hope and expect it will continue.

I appreciate those four variables and basically that’s whatwe’re trying to dig through, so I appreciate the challenge. The second question as my follow-up is the Olympics in Beijing,there was obviously a fair amount of press today about the collapse of theticketing system. I was wondering if you could just comment on that and whetheror not that could have a direct impact on costs as you go into the Decemberquarter, and if you could provide any high level color on the December quarterlike you had in the past. Thanks.

I think on the overall cost and profit impact, that will beimmaterial. Obviously this is something we didn’t want to happen, but -- and wehave done significant testing in advance at all sorts of levels of expecteddemand that we anticipated to be very high, and demand just was significantlyhigher than anything that we had tested against. The team there on the groundis working through that and they’ve got the situation well in hand, but theoverall operational and financial result is immaterial.

Our next question comes from the line of Jeetil Patel withDeutsche Bank. Please go ahead.

Great, thanks. A quick question on the HSN turnaround that’scontinuing here; can you guys talk about with the positive comp of 5%, do youthink that it was more of a function of easier comparisons or just theunderlying metrics improving? Is it more product selection or just you areseeing better frequency in your customer base? Follow-up to that, what is your strategy -- what is theoptimal mix you would like to see in the growth rate of the business from auser standpoint versus a -- call it a frequency, customer purchasing activitystandpoint?

It’s categorically, in your alternatives, categorically thelatter. I don’t think there is really a comp issue at play here. You all havekind of been with us through this ride of 2007. We have changed a lot of thingswith a significant merchandising overall, a lot of team changes, and we’ve hada combination of issues that relate to that, and when you are trying to in asense completely reprogram the network from a merchandising perspective, ittakes a while to get all the gears to mesh. And so as we look at the metrics now, we have strengthgenerally speaking. There are a couple of pockets of weakness, but generallyspeaking, across all key merchandising lines and divisions, we are getting verygood performance out of our core customer and as Doug said, the customer filehas stabilized really for the first time in over a year. All of the metrics, both new, weekdays, weekend, no matterhow you slice it and dice it, it is good and balanced growth at that 5% figureand we think it is essentially the changes are working and the execution, theday-to-day execution, which is the nature of this business, is better. I think in terms of the second part of your question interms of the optimal long-term, I guess it is trite and cliché to say, but youalways would like both. We would love to see customer count grow and obviouslyyou want to get more dollars per customer. I think at the end of the day, it’s hard to say what thatmix will be. We know that in that 4.5 million customers that there’s a heck ofa lot more buying power than what we are currently taking from them. They buyin our competitors, they buy in other Internet and direct channels, they buy instores, and so I’ll answer it this way -- if that never grew, we could still dojust fine. Obviously we hope we get it both ways.

And you’ve been making quite a few changes on the inventoryselection side. Can you discuss -- you’ve obviously been winding down oldinventory and ramping up with a new selection. Can you talk about whatpercentage of your transformation in that area is complete at this point?

It’s well underway. I mean, if you look at the businesses,and there is no easy way to summarize it and you get into line by line, but ifyou looked at the 10, 15, 20 businesses that we were in say a year ago, wherewe said it should be smaller -- it may be great business. It may be goodbusiness for our customer. It’s just it’s been over-rotated, overexposed andpushed beyond its natural limits, and that should be smaller. I would say in all of those cases that has happened and to amaterial degree. And so we are well on that way. That’s the very tough part because as you pull out some ofthat tried and true and you are trying to replace it with new, it’s hard tofind the new that works at high enough productivity levels that you haveyear-on-year sales growth. So where are we in that? Look, until we are consistentlyquarter in and quarter out growing at sales growth rates, ideally in excess ofeven the five and at gross margin rates that are flat or better year over year,then we still have plenty of work to do but we think the consistency is theremonth after month now, and we’ve gotten a good start into that.

And the only thing I would add on HSN is just the success ofthe dot-com. I mentioned earlier about the relaunch of that. We’ve also changedthe merchandising strategy of dot-com to have much more dot-com onlymerchandise and to really widen the assortments there, so we can use it notonly as a vehicle for keeping our existing customers but also attracting newcustomers, and as that site gets continually enhanced and new features areadded to it, we’re just seeing great performance on the dot-com side.

Our next question comes from the line of Imran Khan with JPMorgan. Please go ahead.

Thank you for taking my questions. I have two questions, onerelated to HSN and one related to Ask. HSN, it seems like the ASP was up 5%. Iwas wondering how sustainable that is and what drove this ASP growth rate? Secondly, relative to Ask, our analysis shows that your takerate from the Google deal is around the high 70s, closer to 80. As the deal iscoming up for renewal and alternatives, other search engines, can you give ussome color how confident you are that you can get better rev share? Thank you.

We’ll take them in order. On the price point issue, theblended price point -- we struggle with this because it is hard to summarize.At the end of the day, it’s an amalgamation of so many factors that it tendsnot to be something that is particularly meaningful. The way we manage the business is first of all, averageprice points kind of division line by division line, so whether it’s fine gold,gem stones, whatever it may be within the jewelry category et cetera, throughthe other classifications. And then also, looking at the number of entry-levelprice points we have in given lines of business. If the average goes up, that’sfine. The key question is in those categories where we know theyare good drivers of new customers, new names, are we giving them enough selectionat lower price points because you are more likely to get a new customer untilthat trust is established. And on all of those metrics in terms of percentage of timedevoted to lower price points, number of products with below $50 price points,what we call perceived price point, which is the percentage of air time devotedto that, actually sold -- all of that, all of those metrics are saying we aregiving the customer more variety at those entry level price points. And as long as we are doing that, the average will go wherethe average will go. On the second question, as people know, our sponsoredlistings deal expires at the end of the year. Discussions are in process and weexpect to have a favorable resolution soon and that’s about all we can say atthis point.

Thank you.

Our next question comes from the line of Mark Mahaney withCitigroup. Please go ahead.

Thanks. Tom and Doug, I wanted to ask about the Ticketmasterbusiness and earlier in the quarter, you made public statements to the effectthat you did not expect a continuation of the Live Nation and the House ofBlues deals when they terminate at the end of ’08 and beginning of ’09. Anyupdate on that? Any thoughts on your abilities to substitute what could be amaterial 15% to 18% of your ticketing business? And are there any signs that you are seeing in themarketplace to date that indicates that customers of Ticketmaster are alreadythinking about potentially Live Nation as a new company to work with, or i.e.,seeing greater competition potentially in churn rates or anything in themarketplace? Thank you.

On Live Nation specifically, there is no update there. Toyour broader question, we are absolutely continuing to make progress on anumber of fronts at Ticketmaster and we remain -- we think that next year andbeyond, that Ticketmaster's business will be absolutely just fine. When you look at all the changes that we’ve instituted andall the new strategic relationships, the success that we’ve got in secondarymarketing, to continue, as you put, you asked about client churn, the continuedability to sign up and renew clients despite the fact this is a verycompetitive industry, we are very successful at signing new clients. We’ve gotmuch greater adoption of the secondary ticketing initiatives, much greateradoption of auctions. We’ve continued to add acquisitions, continue to expandinternationally, continue to bring in new product lines like Echo Music and others,and to work very closely with our clients and artists, et cetera. And all ofthat is working and continues to expand, so we remain very confident onTicketmaster.

The business, if you step back and think about it, thebusiness every single day is increasingly more balance. You obviously don’treplace, I know we get that question a lot, a client or a ticket volume orrevenue stream. You don’t replace that with one thing. But the business is more balance. Just this quarter for thefirst time ever, one of our top 10 events came from Australian. We didacquisitions in Spain and Turkey. As Doug said, I think we retained or signednew nearly 1,000 clients and lost a handful, a small handful. So we are gettingnew revenue streams in multiple places. This will play out over one to twoyears and as it does, we are going to grow all of these revenue streams andobviously at the right times, we’re going to have to quantify this a bit morefor you, but it’s a bit premature in that regard. And just to put an exclamation point on the last part ofyour question, no, we’ve not really seen any change in the competitiveenvironment in any way at all. I think Ticketmaster's position remains as itwas.

Our next question comes from the line of Robert Peck withBear Stearns. Please go ahead.

A quick question on the balance sheet; we noticed you had noacquisitions this quarter and previously you had a couple of acquisitions in Q1and Q2. Are you scaling back a little bit on the acquisition front, or is itmore of just a timing of potential acquisitions you may be doing? And number two is Barry has historically talked aboutincreasing the leverage on the balance sheet. Could you give us an update thereon where you stand on that and maybe what would be catalysts or drivers to haveyou make some moves there? Thanks.

On acquisitions, the answer is no. I mean, we’re not --sorry, we’re not scaling back. There’s always going to be timing elements tothis and I think, as best one could say, and we always caveat it by you neverknow when opportunity presents, but as best one could predict, the type ofactivity you’ve seen really over the last two years now, I think since the Askdeal, which was now more than two years old, we’ve been in these kind ofsmaller to modest sized acquisitions that either establish an interestingposition for us in some new space or add to what we have. There’s been a numberof them last year. This year, the fact that there’s nothing in Q3 I think ismore timing than anything else. We’d expect it to continue as it has. On the balance sheet, as you all know, it’s never somethingwhere we can move towards a specific or established goal. We’ve said and Ithink hopefully have shown by this quarter’s action and previous quarters, weview ourselves as over-capitalized. We are moving in the direction of shrinkingthat capital. It won’t come at a predicted pace and it won’t move to anestablished end line, but actions speak louder than words. We bought back $1billion of stock last year. We bought back $500 million worth of stock thisyear. We had a very strong cash flow year last year and cash flowthis year, despite some of the [earnings pressures], have continued to be good.So we are buying stock back and yet we remain quite capitalized, and I thinkthat general environment and general aspiration remains without any specificmoves contemplated or specific goals articulated.

Our next question comes from the line of Brian Pitz withBanc Of America.

Thanks. First a question on the media business; any color onyour decision to switch from DoubleClick to Atlas for your media properties andthoughts on monetization, relative to previous levels? And then, a second follow-up on LendingTree; any view onpotentially moving towards a CPM or cost-per-click based model, rather than aprimarily lead gen based model? Thanks.

Sure, I can take both of those. First off, on theDoubleClick versus Atlas, we actually didn’t switch from DoubleClick to Atlas.We basically did a company-wide RFP where we talked to DoubleClick, Atlas andsome others about getting on one platform both the buy side and the sell side.Several of our businesses had used Atlas, a couple of our businesses had usedDoubleClick as well. We look at all the pros and cons of both, going backalmost a year now and thought Atlas was the right answer for both the buy sideand the sell side. The buy side has been implemented, as I’ve talked about inthe past, and the sell side is in process now. We’ve got several sitesconverted over with several more launching in the first quarter. In terms of monetization, the key benefit of monetizationthat we’ve seen so far on advertising has come from a couple of things. One isour own ability to go sell and be much more effective at selling and, as we getmore scale in advertising, we can attract more advertisers in, we can raise theprices. In addition to that though, we’ve also seen the operationaleffectiveness really improve. We are better at the sell-through and measuringthat. We are better at figuring out which advertiser you put in a given slotwhen they might actually overlap, and all of that has helped to improve theCPMs on the site. On LendingTree, the CPM versus lead fee, I don’t think we’dmove to a CPM on LendingTree. And at the end of the day, the way lenders lookat this and the way that ServiceMagic’s clients do and all of our otherbusinesses that are in lead gen, they look at it on a cost per fundedtransaction, and they try to get an attractive marketing cost. So whether weare on a CPM or a lead fee or a closing fee, none of that -- at the end of theday, they are going to look at it on the all-in cost. Now, what we have done is as we increased the pricing on theLendingTree network about 10%, we’ve also shifted a lot of the revenue, a lotmore of the revenue to an up-front fee as opposed to the back-end fee. Thereason there is it obviously reduces our risk, brings in more of the revenueupon transmitting a lead as opposed to actually closing, and it also is aneffective price decrease for your best closing lenders, because they buy fewerleads to get every closing and it helps to thus get you more aligned with your bestpartners and really puts a price increase on your worst-performing lender. So what we are doing is gradually moving the pricing moretowards the up-front. With our Get Smart product, it’s 100% up-front, but Idon’t see us moving it to a CPM-based model.

Our next question comes from the line of Doug Anmuth withLehman Brothers. Please go ahead.

Thank you. Tom, first can you just clarify in terms of theoutlook for the fourth quarter -- I know you went through the various divisionson what your outlook is for OIBA in 4Q. Secondly, now that we are seeing better top line growth inboth HSN and in Ask, can you talk about when we are going to see more of anemphasis on the bottom line, what the key initiatives are there and when we canexpect to see that more in the numbers? Thank you.

Sure. Obviously we are not going to do detailed guidance,but if you think about Q4 and I almost think about it relative to Q3, in Q3 wehad a very steep decline, as I said I think in my remarks, on lending and thatwas in a sense offset by very positive year-over-year results at Match. That’sjust kind of how I think about it, and we got whatever we got from the rest ofthe businesses. When you go into Q4, because we shifted some marketing spendand we want to invest in some of those domestic and international personalsites in the fourth quarter to set us up for a very strong Q1, and Q1 is kindof the game in personals to set you up for the year, as we’ve seen year afteryear now, we’re going to be, depending on where Lending -- we made $17 millionin Lending a year ago, and so with the loss of that, with whatever the finaltally of Lending ends up being, that’s going to be a very steep mountain toclimb to then get back to any kind of growth position for IAC overall. If you go through the businesses, again, we’re hoping tohave a flat to slightly up quarter at HSN. We described roughly the same atTicketmaster. There are some real comp issues in the Ticketmaster quarter ayear ago and you can go back to the Q4 release of a year ago and see thatspelled out. And we should get some good results in other places, butthat LendingTree loss from a year ago makes it a very tough mountain. We startto get much more favorable comps in Q1 and beyond. Until then, it’s just veryhard to grow overall. I think on your second question, I think more to come fromus on that, in a sense. We are not really ready to address that. As I saidearlier, we are getting good growth across the search and media properties andgenerally have continued to invest in that back in the core search engine,Ask.com. In given quarters, and in fact even in this year, we’vegotten good profit growth, so it certainly is a net contributor and profits thisyear will be up materially in the Media and Advertising business and the searchbusinesses collectively. What the mix on that is and what that long-termbalance is, I think more to come on that. It’s premature to articulate it.

Our next question comes from the line of Aaron Kessler withPiper Jaffray. Please go ahead.

A couple of questions here; first, can you give us thedemographics of maybe the typical Fun Web products user? Also, how sticky arethese products and how are you gaining traffic here -- is it more viralmarketing, SEO, or something else? And one follow-up.

The demo on Fun Web products will differ by the product. ForZwinky, it’s predominantly teenagers, would skew more female than male, andthen now in terms of stickiness, we find them to be very sticky. We’ve seen thetime on site improving dramatically, particularly as we launch the virtualworld part of Zwinky, where people are increasingly hanging out and doingdifferent things in this virtual world. We’ve had virtual concerts. We now havemerchandise, we have licensing and we see we now have the opportunity to have alittle home on Zwinky and to customize that, so the more of those things youadd, the stickier it gets. In terms of how you get traffic on those, it’s beenpredominantly viral and the reason is these things also, in addition to beingin the virtual world, Zwinky as well as Smileys have great viral components tothem. You can put them on social networking pages, you can put these things onblogs. People obviously put smileys in their e-mails and in order to then seethem, you download many times the toolbar on the other side in order to sendsomething on. So all of these things have great viral elements to them. In addition to that, we spent a lot of money on onlinemarketing in that business, particularly through ad networks. It’s for the mostpart, a very large most part, it is all CPA based advertising and the teamthere is fantastic at it and that’s how we’ve been driving traffic.

And one follow-up; how are you viewing the current state ofthe real estate market? Obviously it’s a negative but are you viewing that asan opportunity to pick up share, maybe to acquire some properties that aredistressed right now? How should we think about that going forward?

As always with acquisitions, we don’t comment specificallyon that. Let me just give some broader comments though about real estate. Thereal estate market nationwide is obviously experiencing challenges but it isparticularly acute in five key states. We do hope to gain share in real estate.However, we are being cautious here. We have a lot of great success in therevenues business but we have not yet proven fully that we can attract leads ata very low cost of getting leads to grow that business, and that our conversionrates are where they need to be yet to really scale the business, where youwould go at this much more aggressively than we have. So we’ve made some very, very small acquisitions in yearspast. We are adding offices and we are adding agents very aggressively, becausethey are not employees, and we are increasing our marketing spend in localareas, but we are being cautiously -- I would say cautiously aggressive but notyet at the point where you would really want to step on the gas.

Our next question comes from the line of Jeffrey Sheltonwith Natexis. Please go ahead.

Thanks. Can you talk a little more about the branding forAsk.com? I think earlier this year there were comments made about $100 millionbeing spent in branding. Do you think -- are you in line with that for thisyear, under, over?

Tom’s looking up the specific number. Just in terms of theoverall though, our Q3 spend was much less than it has been in prior quarters.However, with that, we’ve still seen great results from the advertising. Weknow that product demo spots work and the more we can highlight the great toolsand features of Ask.com, the better we see that working. We have increased, particularly in the online space, wherewe can get a very direct result between running a product demo online spot andseeing a direct result to click-throughs, so that’s one area that we increased. And on the specific number --

In general, I would say our commitments are along the linesof what we’ve previously indicated. The year has been an evolution in trying tofind what works. Earlier in the year, we had the algorithm campaign. We’ve moveit more to a call to action featuring the site, and we’ve been shifting arounda bunch of the online spending. I think the investment is there and I think again, more tocome on this, but as we look towards 2008, the focus will be not necessarily onspending more money but on spending comparable amounts of money, and don’t takethat too literally. I don’t know if it’s up a penny, down a penny, but continueto invest in the brand but I think we’ve learned a lot this year and we’ll bemuch more efficient at it as we go forward.

Are you guys still seeing increased retention and frequencythat you talked about last quarter?

Absolutely. The new 3D experience has moved those numbersnicely. It still doesn’t approach yet where the Googles of the world would be,but those numbers are certainly doing better.

People like the site.

Do you think at this point you are poised to take somemarket share?

Excuse me?

Do you think you are poised to take some market share thenin terms of queries?

We are poised to grow our business strongly. Market share,just as an editorial side not, is becoming an extremely complicated calculationbecause ComScore’s changed their definitions of it, more and more they areincluding searches that originate on distributed sites, affiliated sites, andunder some definitions that they report, even under non-traditional searchsites. So I think that the definition of that is becoming complicated. And then of course, Google is just so big that what they dois obviously moving the market. I think where the market share calc rolls up, Idon’t know. I’d say we feel very good about our ability to continue to grow thevolume of the business, the monetization of the business, and its financialhealth overall.

One small note, but indicative of how you continue toinnovate here, one of the recent launches we made was the ability to skin --call them skins -- to be able to have a customized background on the Ask.compage. We are now getting the home page about 10% of users are starting to usethose and we see much higher retention and frequency as people do that. So youcan just imagine making Ask.com your own over time, and as you become anengaged customer, you stick around and use the service more frequently.

Why don’t we take one or two more and then we’ll let you allgo?

Our next question comes from the line of Heath Terry withCredit Suisse. Please go ahead.

Thank you. I was just wondering if you could give us anupdate on the strategy for Match. We actually saw for the first time in fouryears paid subs decline. Is there anything behind that other than just how youare dealing with marketing spend, or is there something else that we should bethinking about with regard to the personals business?

You’re referring obviously to the domestic places where thesubs have leveled off, declined a little bit this quarter?

Sure.

Two things; one is we really try and optimize the businessfor revenue, and late last year, we took a price increase in different packagesand things like that, and so revenue in the domestic business is up nicely. We could drive subs tomorrow by cutting that price and it’salways that optimization game, and we don’t think -- you think about itdifferently in different businesses, obviously. In this business, we don’tthink having sub growth at a certain level is a strategic issue. Now, if it declined materially, we might change our mind onthat, but within the ranges of what we are talking about, we think the guidingphilosophy of revenue optimization is the way to manage the business. The second thing is, and we bought this business that had $6million of revenue in 1999. If you go back and chart it, subs have always grownin some sort of stair step function. It’s always been a business where you haveto drive category growth. And if you think about it, there’s only really twobranded players domestically that are out there to educate the customers andbring them to the category, ourselves plus EHarmony, and it’s always been afunction of coming up with clever and creative product innovation and marriedto very effective marketing campaigns, offline and online. And historicallyagain, when you get that magic right, the category can jump, will grow, and attimes it’s leveled out. And this has been going on for eight years and our bestguess is we will grow again soon, andthe category is still very under-penetrated relative to the 80 million singleswho are out there eligible for the service.

Why don’t we take one more question, if there is one?

Our next question comes from the line of Jeffrey Lindsaywith Sanford Bernstein. Please go ahead.

Thanks, Tom and Doug, for taking my question. We just wantedto ask about two things. Basically, qualified forms at LendingTree seem to bedown by 29%. Could you give us some sense of the prospects for improvement?Could you change the mix or could you change the product set here torestimulate growth? And then second, in Ticketmaster we noted that the take rateis down. Would that imply that you are discounting to preserve share, or is ita mix shift and how should we think about this going forward?

I’ll take the first one and Tom will take the second one. OnQFs, volume of qualification forms at LendingTree is related to advertisingspend. The good news and bad news of this business is that those two are veryhighly correlated and LendingTree targets its ad spend in areas where it isprofitable. As profits have declined on a per customer basis, your marketing incertain channels and certain placements goes negative and then you just cut adspend as a result of that. So the way to stimulate QF demand would be to spend more andobviously we are not going to do that because we want to make sure that ourmarketing is profitable. What you can do though, you can shift it to a muchstronger call to action, and we’ve done some of that and you’ll see us do that inthe new spots that we run, and we run more online rather than offline, andyou’ll see that mix continue to happen. You’ll see us over time probably accentuate some of theproducts that are less recognized on LendingTree today as the mortgage businessis taken off. For example, we have an auto business, a credit card business, apersonal loan business, student loans, et cetera. So there is opportunity insome of those markets. We can leverage the Get Smart brand on a so-called shortform lead. So there are definitely things you can do to boost it, butin this environment, you really want to be conscious that you don’t overspendon marketing, so we are going to err on the side of keeping marketing spend lowand letting volume be what it will be, as opposed to trying to drive volume.

Jeff, I’m sorry, could you repeat your second question?

On Ticketmaster, we noted that the take rate is down, and sowe wanted to ask you is this a conscious policy of discounting to preserveshare, or is it a mix shift and how should we think about this going forward?

You’re talking about revenue, kind of revenue per ticket, ifyou will?

Yeah.

No, it’s mix shift. It’s absolutely not the performer ordiscount or anything like that. Pricing generally is controlled by our clients,first of all, so we don’t set those prices. And the handling fees, that’s ourrevenue per ticket, in a sense are negotiated in and generally are tied to thebase value of the client. But in the quarter, concerts, and I mentioned it was a verygood concert season in Q3 a year ago, were 2% lower -- accounted for 2% fewerof our business than in the year-ago quarter. And music tickets tend to havehigher face value tickets and higher convenience fees. So if you adjusted for mix, and also a bit for internationalgrowth, international convenience fees tend to be a bit lower and we aregrowing faster international, so those two mix issues drive the overallsegment-by-segment, country-by-country. There’s nothing changing or going down. Thank you all for joining us today and we will talk to yousoon.

Ladies and gentlemen, this concludes the IAC Q3 earningsconference call. Thank you for your participation and you may now disconnectand have a pleasant day.