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IAC's Diller Backs Paid Online Content

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NEW YORK IAC chairman and CEO Barry Diller is the latest industry executive to predict a near-term move away from the free Internet world toward more paid-for online content.

In a keynote address at the Advertising 2.0 New York conference Wednesday, Diller also said that Internet advertising spending may have been down in the first quarter, but likely won't get worse. Plus, he called his relationship with Liberty Media chairman John Malone "repaired" and spoke out against the concept of conglomerates in the media and entertainment sector.

"Anything of any value...is going to get paid for" online, Diller said during the event, which was co-hosted by Internet juggernaut IAC and Digital Hollywood.

Diller said the switch to more paid offers is "absolutely inevitable" in order for content producers to survive and the change is already under way. News Corp. and other media biggies have recently signaled they are gearing up efforts to charge for more digital content.

Diller said he expects micro payments to be one pay model on the Web once billing systems become simpler, and he described the success of iPhone applications as a clear sign where things are headed.

"People will pay for content," he said. "They always have."

The ad recession was also in focus Wednesday. "It's not going to be great" this year, Diller said about Web advertising. "[But] it's probably not going to get much worse."

Recent economic data suggests the worst of the recession may be over, and CEOs of big media companies have recently also talked about a stabilization in the ad market.

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