The always-entertaining media mogul folded his cards on IAC/InterActiveCorp, the Internet conglomerate that owned everything from Ask.com to the HSN TV shopping channel. Aside from that impossible name, Diller's company just didn't work as a multimedia conglomerate (Diller himself called it a "complex enterprise"), and now the plan is to turn it into five companies. IAC will be focused on the media and advertising business (Ask.com, Match.com and Citysearch), while the other less successful segments – HSN, Ticketmaster, Lending Tree and Interval International (that's a timeshare business) - will be spun off. Here's what Diller said in a statement this morning: "I've always believed our complexity and many mouthfuls of sentences to explain who we are and what our strategy is have hampered clarity and understanding with all our constituencies, particularly investors." IAC last week reported a 4.2 percent drop in third-quarter net income (and Diller didn't participate in the conference call, which is very unusual). From the WSJ:
The split-up comes as Mr. Diller and John Malone have hit a rough patch in their relationship. Mr. Malone, like Mr. Diller a longtime media mogul, has been increasingly vocal about his displeasure with IAC's recent performance. His company, Liberty Media Corp., owns a majority stake in IAC but years ago gave Mr. Diller voting control over the shares. The restructuring comes several months after Mr. Diller contemplated selling HSN to Liberty, which still holds a majority voting stake in IAC although Mr. Diller has the right to vote Liberty's shares. Mr. Diller and Liberty Chairman John Malone had considered swapping Liberty's stake in IAC for full ownership of HSN, although HSN's weak performance contributed to collapse of negotiations. Its unclear whether the restructuring will spur revival of those talks.
Here's what Diller told me some years ago in a Forbes profile about IAC (what was then known as USA Networks):
"We have a unique way of approaching the future which no one else has," Diller boasts. "We may be totally wrong. It may be a crackpot idea. Nevertheless, it's completely unique...It's only somewhat recently that the direction we've been going had enough assets that were related to each other that the story could get clear. We think this issue that we're this hodge-podge of unrelated assets is no longer relevant."
Apparently it was - and still is.