"I see my company getting involved in...producing, financing and distributing filmed digital product, in half-hour, hour, and two-hour movie form," said Diller, speaking to a packed room of attendees at the three-day conference's opening session. "The reason it (will) come naturally is because we all know everything is going to be in digits."
Diller mused on how the convergence of the PC and TV will alter the landscape of entertainment creation, distribution and consumption. The search box, he said, will be at the heart of media access. "I think it's going to be one world. Convergence is going to allow for a potential change-up of the players."
IAC owns ticket company Ticketmaster, personals site Match.com, travel site Expedia and other online properties.
Diller's comments come as many traditional media and Internet giants, like his own IAC, are moving quickly into Web content production. Yahoo, for example, has been building a presence near Hollywood and, sources say, developing original shows for the Web.
Though not directly developing shows, Google recently signed a deal to distribute UPN's first episodes of "Everybody Hates Chris," a series about the young life of comedian Chris Rock, in the first such deal for the search giant.
Meanwhile, media consolidations that propose to combine content creation with Internet distribution continue: Rupert Murdoch's, and .
In March, IAC made a big bet on Web search by, for $1.85 billion. Diller said he decided to buy Ask Jeeves because he was worried that Internet search was going to disenfranchise IAC's many different properties by increasingly packing information from travel, personals and ticket services into the search experience.
He said he liked Ask Jeeves because it could offer services different from those of rivals, including No. 1 Google,and . He did not specify how he planned to overtake the leaders in search, but he said it's a day-to-day process that will involve combining IAC's many resources.
Google's lead will not last forever, he said.
"Is Google going to have 35 percent to 50 percent market share over time? It's unlikely," Diller said.