The net loss posted by the company came to about $369.9 million or $1.31 a share. This is compared to a net income of $15.3 million or five cents a share according to WSJ.com.

$475.7 million in write-downs at LendingTree and $57.2 million at the entertainment business were included in these results. The previous year saw write-downs that equaled $214 million in the entertainment divisions of the firm.

Barry Diller, chairman and CEO of the company said to wsj, “There is good news and bad news this quarter – the mix of which is another reason why our previously announced plans to reorganize IAC into five independent public companies makes more and more sense.”

The online conglomerate’s business includes properties such as the HSN home shopping network, Ask.com, Ticketmaster, Citysearch and LendingTree.

Revenue at LendingTree dipped 55% due to the recession. Operating losses totaled $508.1 million. The media and advertising division which includes Ask.com, Evite and Citysearch gained 42% in revenue, the report continued.

The entertainment arm had a $57.2 million impairment charge due to languishing fund-raising channels for Sally Foster products and coupons, but saw a 27% revenue increase for Ticketmaster. Various fluctuations within this arm are due to many components, including but not exclusive to the economic recession.

However there is a problem arising. With spammers creating more intelligent programs, companies are making more and more difficult puzzles to keep out the troublemakers. Unfortunately this is also keeping out the innocent bystanders as well.

Captchas are becoming easier for computers and more difficult for real people which has led many companies, including eBay and Microsoft to work on replacements.

“You can make a captcha absolutely undefeatable by computers, but at some point, you are turning this from a human reading test into an intelligence test and an acuity test,” said Michael Barrett, the chief information security officer at PayPal, a division of eBay. “We are clearly at the point where captchas have hit diminishing returns.”

Captchas, or Completely Automated Public Turing Test to Tell Computers and Humans Apart were developed in 2000 by team from Carnegie Mellon University when commissioned by Yahoo to create an spam protection program. Using a collection of cognitive puzzles unfamiliar to modern computers, captchas was born.

With much research done in an attempt to crack these codes, many people have become more and more successful, even making a business out of cracking captchas. This can work to the benefit of the spammers as well as the companies testing the effectiveness of their puzzles and refining them. This has brought about much controversy especially with time sensitive sites such as Ticketmaster which has created captchas increasingly difficult to read due to the thickness of lines placed over the code.

But new obstacles mean new challenges. Many companies are stepping up to the plate and have yet to disclose their developing programs however, Microsoft has a project in the works called Asirra(for Animal Species Image Recognition for Restricting Access). A series of pictures will be shown and the viewer will be asked to pick out only the dogs or the cats.

“For software, this is wildly hard,” said John Douceur, a Microsoft researcher. “Computers are tripped up by all the photos at different angles, with variable lighting conditions and backgrounds and the animals in different positions.”

There is an effort to keep the captcha in business. Luis von Ahn, professor at Carnegie Mellon and a member of the team that created captchas.His reCaptcha project (recaptcha.net) seeks to block spam while handling the challenge of digitally scanning old books and making them available in Web search engines.

“I heard that 60 million captchas are solved every day around the world, which first made me quite happy for myself but then quite sad,” he said. “It takes about 10 seconds to solve a captcha, so that means humanity is wasting thousands of hours solving them. I wanted to do something good for humanity in that time.”