Blucora (i.e. Infospace): Worse Than Blinkx plc & Babylon Ltd

GOTHAM CITY RESEARCH LLC www.gothamcityresearch.com [email protected]

GOTHAM CITY RESEARCH LLC

Blucora (i.e. Infospace): Worse Than Blinkx plc & Babylon Ltd

“Google's first step is easy: Fire InfoSpace (a.k.a. Blucora). Google doesn't need InfoSpace, and there'szero reason for this relationship to continue in light of InfoSpace's repeated failings.”

– Harvard Business School Professor Benjamin Edelman, author of The Darker Side of Blinkx, and the“Doogie Howser of online investigative work” according to former federal prosecutor Richard Boscovich.

Dogpile.com and Webcrawler.com

Sources: Alexa, Google

‘candydoll tv’, ‘candydoll.tv’, & ‘vladmodels’ are terms tied to child pornography

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Table of Contents

I. DisclaimerII. Summary

III. IntroductionIV. Blucora = Involuntary clicks + Artificial clicks + Illicit clicksV. Blucora’s History of Bad Behavior: The Iminent.com Problem

VI. Google is Better off without Infospace/BlucoraVII. Ties that Blind: “You’re only as good as the company you keep”

VIII. Non-GAAP is BackIX. Shares are Worth <$5.00 per shareX. Appendix A: Blucora and Malware

XI. Appendix B: A Closer Look at Blucora’s 2005-2010 ImproprietyXII. End Notes

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GOTHAM CITY RESEARCH LLC

a GOTHAM CITY RESEARCH’S OPINIONS

+60% of BCOR’s revenue will evaporate in comingquarters, as Google realizes it is better off without BCOR.Google and Yahoo can walk away from Blucora any time.

At least 50% of BCOR’s traffic is derived from malware,click fraud, illicit traffic (e.g. child pornography), andotherwise suspect traffic.

Blucora and its partners’ practices will receive scrutinyfrom Google, advertisers, FTC, DOJ, FBI, IRS, &/or the SEC.

BCOR shares are worth no more than $5.00/share, and<$1.00/share if BCOR compensates affected parties.

SUMMARY OF FACTS

94.81% of Infospace.com visitors go to css.infospace.com,a known redirect virus/browser hijacker.

Infospace.com/Iminent.com generate clicks via cloaking, apractice forbidden per Google’s Webmaster Guidelines.

3 of dogpile’s Top 10 search words are child porn-related.Webcrawler aggressively purchased child porn searchtraffic in recent quarters.

Google prohibits advertising related to child pornography. 80+% of webcrawler’s visitors originate from outside the

US, yet only ~1% of BCOR’s revenues are international. Ads displayed in Blucora-branded search results violate

requirements set in their 2011 Amended Agreement. Metacrawler is the 3,301st most visited site, yet is defunct. ~10% decline in Google revenues wipes ~50% of BCOR EPS. BCOR has a storied history of defrauding investors,

customers, and vendors over the last 15+ years. Free cash flow has gone negative over the last 9 months. ~50% of recent cash flow from operations consists of

increases in accrued liabilities. Non-GAAP reporting, not seen since 2003, is back. Audit fees declined sharply, after changing auditors in ‘12. Gotham City Research contacted Blucora on several

occasions and did not hear back from the Company.

Company: Blucora(formerly Infospace)

Ticker: BCOR (formerlyINSP)

Price Target: <$5.00

Share price: $23.70

Market cap: $976M

Enterprise value: $986M

52-week high: $30.12

52-week low: $14.25

Diluted sharesoutstanding: 42.88M

Float: 38.80M

Avg. Daily Vol: 482K

% float short (1/31): 17%

TTM Revenue: $504M

TTM Net income: $29M

2013 YTD FCF: -$123M

Tangible book: -$45M

FYE: Dec. 31

Auditors: Deloitte &Touche LLP,

Ernst and Young

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INTRODUCTION

Blucora, formerly known as Infospace, is one of the truly great historical case studies of the fraud andexcesses committed during the dot com boom of the late 1990s1. Former Merrill Lynch analyst, HenryBlodget, privately referred to Infospace as a “piece of junk”, even as he publicly remained bullish itsstock. Blodget was indicted for securities fraud, and agreed to a permanent ban from the securitiesindustry (he also paid a $2 million fine plus a $2 million disgorgement).2

While Mr. Blodget appears to have subsequently turned around his life (as evidenced by his modestlysuccessful media outfit, Business Insider), it seems Blucora never learned its lessons. For example, wediscovered that nearly all infospace.com traffic is malware-related, and that BCOR’s search volumesexperienced a significant boosted in recent quarters, due to a rise in illicit search traffic (specifically childpornography searches). We also captured a specific instance whereby infospace.com/imminent.comgenerates clicks via cloaking (the practice of presenting different content or URLs to human users andsearch engines). Cloaking is considered a violation of Google’s Webmaster Guidelines because itprovides users with different results than they expected3.

Professor Ben Edelman has been recording and exposing Blucora’s wrong-doing since 2005

We discovered that we were not alone in our findings. Harvard Business School Professor, BenjaminEdelman, who recently exposed Blinkx plc’s wrong-doing in a piece titled The Dark Side of Blinkx, hadalready exposed Infospace.com’s wrong-doing over many years.

In January 2010, for example, Edelman exposed Blucora’s role in a complex ad fraud scheme (whichincidentally involved AdOn Network, a Blinkx subsidiary). At the time, Professor Edelman stated4:“Google doesn't need InfoSpace, and there's zero reason for this relationship to continue in light ofInfoSpace's repeated failings.” Blucora seemed to show some remorse, as it “discontinued thesyndication of our search results to certain distribution partners who we deemed to be delivering lowquality clicks.”5 BCOR took a hit to revenue, and its share price suffered as well.

Worse than Blinkx Plc, as Blucora Continues its Wrong-doing

Gotham City Research believes that Blucora did not correct its behavior, after Edelman exposed thecompany’s wrong-doing in January 2010. If anything, we believe Blucora re-doubled its efforts (searchrevenue has only risen since). We find that Blucora is worse than Blinkx for the following reasons:

94.81% of Infospace.com visitors go to css.infospace.com, a known redirect virus/browserhijacker. Webcrawler.com, dogpile.com, and metacrawler.com seem no better.

Infospace.com/Iminent.com appears to drive traffic via cloaking, a practice forbidden perGoogle’s Webmaster Guidelines. Their scheme reminds of Infospace.com/WhenU in 2010.

We estimate at least 50% of BCOR’s traffic is derived from malware, click fraud, and illicit traffic(e.g. child pornography & pirated content). It would explain how webcrawler.com has becomethe 460th most “visited” website today, ahead of att.com, irs.gov, quora.com, retailmenot.com,elance.com, abcnews.go.com, and surveymonkey.com. Clicks aren’t really clicks.

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Blucora = Involuntary clicks + Artificial clicks + Illicit clicks

Are Blucora’s Recent Search Revenue Growth and Traffic Gains Too Good to Be True?

Blucora (a.k.a. Infospace) refers to itself as an “established player in search advertising.”1 Search trafficand revenue have risen dramatically over recent years and quarters2:

In fact, BCOR’s most popular property, webcrawler.com, has somehow become the 460th most popularwebsite today (it was the ~7000th most popular website in the world just 2 years ago)3:

Reasons for grave doubts and why BCOR’s performance does not pass the “sniff test”

The company’s phenomenal performance makes little sense given:

Brand recognition for its properties is nearly non-existent (when is the last time you heard aboutwebcrawler.com, outside of this Gotham City Research report?). Metacrawler is defunct4.

Webcrawler.com ranks ahead of att.com, irs.gov, quora.com, retailmenot.com, elance.com,abcnews.go.com, surveymonkey.com, even as webcrawler.com is a poor quality product5:

Blucora’s peers (e.g. Babylon stock fell -60%) have been negatively impacted by recent Googlepolicy changes (Note Blucora derives 60+% of revenue from Google vs. 40% for Babylon)6:

Blucora Search Revenue Breakdown$ in millions 2010 2011 2012 2013LTM

Total revenue $214 $229 $407 $504Search revenue $214 $229 $345 $399

Distribution Partners 69% 80% 88% 85%

Owned & Operated 30% 20% 12% 15%

How Popular are BCOR's owned sitesrelative to other sites? Alexa Traffic Ranks

BCOR Property 2012 TODAY

Webcrawler.com 7,000 460Infospace.com 1,800 1,868

Dogpile.com 4,000 2,300Metacrawler.com 30,000 3,200

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The Best Explanation: BCOR Uses Devious Practices to Artificially Boost Search Results

Gotham City Research believes most of Blucora’s search revenue and traffic growth result from:

Involuntary clicks – Intentionally deceive vulnerable users (e.g. the elderly), via malware, viruses. Artificial clicks – Boost fake/artificial traffic via click fraud (for example, hire cheap labor in India

and other developing countries to click on ads, all day). Illicit clicks – Attract users interested in child pornography, pirated materials, & similar.

In fact, we estimate at least 50% of traffic is involuntary, artificial, and/or of otherwise suspect origin7:

In the next ~20 pages, we provide the facts and considerations that lead us to believe 50+% of searchtraffic is suspect. See Appendix A for accompanying notes to the above table.

The Underlying Blucora/Infospace Business Model

Blucora/Infospace and its distribution partners’ traffic-boosting schemes are complex and inherentlyadaptive. Underlying the intricacies, however, is a conceptually simple business model:

Weight Suspect % of TotalBCOR PROPERTY Factor* Traffic** Traffic**webcrawler.com 62.9% 33.0% 20.8%

Infospace.com 15.5% 94.8% 14.7%metacrawler.com 12.6% 100.0% 12.6%

dogpile.com 9.0% 33.3% 3.0%TOTAL SUSPECT TRAFFIC: 51.0%

Step 1: DisseminateLatest

Malware/Virus/ClickFraud Scheme

Step 2: Victimscomplain, even as

BCOR reaps clicks andrevenue

Step 3: # ofcomplaints reach

critical mass & BCORcommences R&D of

new schemes

Step 4: Blucoraabandons old scheme,

feigns remorse

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Consequences of Blucora and its Distribution Partners’ Malfeasance

The artificially boosted search revenues (60+%of total revenues) will decline significantly in thenear future, eventually reaching de minimis levels, as Google and advertisers realize they’rebetter off without Blucora (see Google is Better off without Infospace/Blucora)

Google, advertisers, the FTC, DOJ, FBI, IRS, and/or the company itself will validate our beliefs. Blucora’s malicious intent is evidenced by its many years of violating rules and regulations.

The following facts support our beliefs:

All of Blucora’s main web properties are tied to malware, viruses, & browser hijackers thatattack computers. Infospace is described outright as a “fraudulent web search engine”.

3 of Blucora’s Top 10 search words are child pornography-related terms, on dogpile.com.Webcrawler aggressively purchased child porn search traffic in recent quarters.

Over 90% of webcrawler’s top search terms are generic terms. 80% of webcrawler.com’s visitors originate from outside North America. Over 33% originate from India, Pakistan, Indonesia, Nigeria, and Bangladesh.

Pertaining to Google (see more in Google is Better off without Infospace/Blucora):

Blucora’s displayed ads in search results fail to comply with Google’s guidelines, as described inits 2011 amended agreement with Google.

Google prohibits advertising related to child pornography. Even if Google/Blucora Renew their Agreement in March 2014, Google can walk away any time.

The Many Ties that Blind (see Ties that Blind: “You’re only as good as the company you keep”):

All the search-related violations mentioned in this report, and elsewhere, happened under thecurrent Chairman, CEO, CFO, and Infospace President’s watch.

BCOR’s current and past business partners include WhenU.com, Blinkx, Intelius.com, Babylon,info.com, and Iminent.com, i.e. a “who’s who” of the worst malware/click fraud offenders.

Top five distribution partners generated approximately 25%-50% of total revenues, yet thecompany refuses to disclose these distribution partners’ identities, on the record.

Blucora/Iminent.com cloaking behavior we’ve captured resembles Blucora and WhenU.com’simpropriety, as caught in 2010 by Harvard Business School Professor, Ben Edelman.

BCOR shareholders do not understand that BCOR has achieved high & steady revenue growth since2010 by taking on greater and greater risks, which remain hidden until…

“A Turkey is fed for 1000 days—every day confirms to its statistical dept. that the human race caresabout its welfare ‘with increased statistical significance’. On the 1001st day, the turkey has a surprise.”8

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Involuntary Clicks: infospace.com is a “fraudulent web search engine”

A web security expert describes infospace as a “fraudulent web search engine”. He also states9,

Infospace.com is associated with browser hijackers and rootkits such as Google Redirect Virusand ZeroAccess rootkit

Browser hijackers and rootkits involve a tracking cookie which helps cybercriminals to changesearch results on Google and other major search engines and redirect Internet users toInfospace.com and other malicious advertisement websites.

This explains why 94+% of traffic is directed to css.infospace.com, a virus/browser hijacker10:

Ccs.infospace.com is “http://www.keepbrowsersafe.com/remove-css-infospace-com-get-rid-of-css-infospace-com-from-pc”

1. It installs in the computer system without users’ permission or consent often with freedownloads.

2. It changes existing browser settings including provided search engines and home pagescausing it to redirect to related malicious websites.

3. As a tactic against innocent Internet users, it appears alike some legitimate searchengine like Google.com and persuade victims to use illegitimate search engine.

4. It often messes up with the privacy settings and exploits them to steal personal files orinformation.

Nearly all google search results for “Ccs.infospace.com” result in some variation of “how toremove css.infospace.com virus” guide.

Unsurprisingly, most victims (i.e., visitors) are middle-aged or elderly11

Subdomain Percent of Visitors

ccs.infospace.com 94.81%

infospace.com 2.12%

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Webcrawler.com, Dogpile.com, and Metacrawler.com Are No Better Than Infospace.com

We find the same pattern of malware-related misbehavior in all of BCOR’s web properties. For example,Fantastigames.webcrawler.com is a tricky browser hijacker that presents itself as a legitimate searchengine and sneaks in the computers without the consent of the user12:

Dogpile.com is referred to as a ‘browser hijacker’ and a ‘redirect virus’13. We believe BCORcleverly infects users by leading them to dogpile.com via searching (on google, ironically) for‘search engines’ and related terms14:

Metacrawler Toolbar is a malware add-on/extension which installs to internet browsers with orwithout user consent15, and seems to infect some users seeking pirated materials, as evidencedby Filmovizija and Kizi 3 searches send traffic16:

Metacrawler.com seems off-line, as it redirects users to zoo.com17

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If Metacrawler.com were a legitimate website, it makes no sense that its website is off-line, andit instead re-directs visitors to zoo.com (quite unpopular website vs. metacrawler)18:

All these websites receive a disproportionate number of elderly visitors19:

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While we prefer to use the term “artificial clicks”, ‘click fraud’ is the correct term to describe20:

“Some fraudulent clickers have gone so far as to automate the process. They use robots or webcrawlers to search through web sites and click on certain links. These bots look for certain URLS orsearch terms & exclude others, costing some companies money with each automated click. Othercompanies have hired inexpensive workers, usually in 3rd world countries, to manually click on links.”

80% of webcrawler.com’s visitors originate from outside North America, specifically over 33% of“visitors” originate from India, Pakistan, Indonesia, Nigeria, and Bangladesh. India is a well-known hot spot for click fraud21.

metacrawler.com22

dogpile.com23

80-90% of traffic originates from outside the US, but only 1% of revenue originates outside the US24

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“Signs [of click fraud] include large # of clicks coming from a single IP address or a block ofaddresses.”25

Over 90% of webcrawler’s top search terms are generic terms26

5 of metacrawler’s top search terms seem to originate from single IPs/blocks27

Did Blucora Move its Click Fraud Operations to India in 2010, just in case HBS Professor Ben Edelman’sJanuary 2010 WhenU/Infospace Exposé would put an end to all the Company’s click fraud schemes?

$0.00

$2.50

$5.00

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BCOR 2010 to PRESENT

BCOR 2010 to PRESENT

HBS Professor Ben Edelmanexposes Infospace/WhenU.comschemes: “Google's first step iseasy: Fire InfoSpace. Googledoesn't need InfoSpace.”28

“During the 1st half of ‘10, we discontinued the syndication of our search results to certain distribution partners who we deemedto be delivering low quality clicks. Those discontinuations had a material negative impact on our revenues for the 1st half of ‘10.”31

-40%

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Something Occurred in 2010 in India that Helped BCOR Continue its Nefarious Schemes to Date

January 2010, The Cyber Sheriff Warns: “Google's first step is easy: Fire BCOR. Google doesn'tneed BCOR, and there's zero reason for this relationship to continue in light of InfoSpace'srepeated failings.”32

April 2010, BCOR Explores New Scheme: BCOR announces it will sell Infospace India to Aditi:“Signed a definitive agreement to sell to Aditi & expects to enter into an outsourceddevelopment arrangement with Aditi. This provides BCOR with continued access to engineeringtalent while reducing BCOR’s costs of managing a foreign subsidiary.”33

Before June 30 2010, Feigns Remorse: “we discontinued the syndication of our search results tocertain distribution partners who we deemed to be delivering low quality clicks.”34 - BCOR

September 2010: Chairman Voelker announces resignation from the Board.35

November 2010: CEO William Lansing quits.36

2011 – Present. Scheme Pays Off, Complaints Rise: Blucora implements its India-based clickfraud schemes, helping the company drive sufficient traffic. Meets and beats internal and WallStreet search revenue expectations. An increasing number of vulnerable users are victimized byBlucora and its business partners’ malfeasance, as we’ve documented throughout this report.

Supporting Facts

Infospace’s search revenue has increased 2x since 2010, even as its brand-recognition declined37:

Step 1: DisseminateLatest

Malware/Virus/ClickFraud Scheme

Step 2: Victimscomplain, even as

BCOR reaps clicks andrevenue

Step 3: # of complaintsreach critical mass &

BCOR commencesR&D of new schemes

Step 4: Blucoraabandons old scheme,feigns remorse, takes a

fianncial hit

Blucora Search Revenue Breakdown$ in millions 2010 2011 2012 2013LTM

Total revenue $214 $229 $407 $504Search revenue $214 $229 $345 $399

Distribution Partners 69% 80% 88% 85%

Owned & Operated 30% 20% 12% 15%

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Supporting Facts – continued

Blucora has taken every possible action, EXCEPT reinvest in its search business since 2010:1. Renamed itself Infospace Blucora38 … why distance itself from a ‘growing’ business?2. Acquired a hodge podge of unrelated businesses, instead of re-investing in search39.3. BCOR has behaved as if its search business can disappear at any given moment.

Aditi has an office in Bellevue, WA, 10 minutes away from Blucora40

Aditi’s CEO is based out of the “Greater Seattle Area”41

Infospace Technologies Linkedin profile sounds as if it could generate search traffic42

Blucora’s main web properties derive a 80+% of traffic from outside the US, and India is the #1and #2 traffic contributor (as shown several pages ago)

Blucora’s past/present relationships with controversial entities such as Intelius, Blinkx (all withoffices 10 minutes away from Blucora).

Blucora does not name a single distribution partner, between 2010 – present (except Make theWeb Better in 2010, which seems to have disappeared unnoticed in 2011), despite their sizeablecontributions toward overall revenue.

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Recent Growth of Owned and Operated Revenue and Traffic

Owned and Operated revenue growth has surprised to the upside in the last 2 quarters, just asdistributed search growth decelerated significantly (presumably due to Google policy changes)43:

webcrawler.com

metacrawler.com

dogpile.com

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Rise of Illicit Clicks Explains Recent Growth in Owned and Operated Search Revenue

We believe most (if not all) recent growth in Blucora’s Owned and Operated search revenues arederived from illicit content searches, e.g. child pornography and pirated content. BCOR had clear motiveto generate marginal traffic from fringe sources, as distribution revenue growth recently slowed44:

“We expect that revenue from searches conducted by end users on sites of ourdistribution partners will continue to be an increasing majority of our search servicesrevenue.” – 10K 2012

Unfortunately for Blucora, Google (as well as Federal Law) does not care if child pornography relatedactivity is 0.1%, 1.0%, 10.0%, or 100.0% of total activity. They have a zero tolerance policy45:

Google is deeply committed to providing a healthy and trusted online environment for all of ourusers, and especially children. While the Internet provides an amazing opportunity for people toconnect with useful information, some online material poses serious risks to children and families,and some online behavior violates the law and should be eradicated. Child pornography, inparticular, is a horrific and vicious crime. Today, I testified before the House of RepresentativesSubcommittee on Oversight and Investigations about Google’s efforts to keep kids safe online.Among the initiatives that I highlighted:

- Google has a zero-tolerance policy on child pornography. We prohibit any advertising relatedto child pornography. When we become aware of child pornography anywhere in our searchengine or on our site, we immediately remove and report it to the appropriate authorities.

- We work closely with law enforcement to help track down child predators, and respond tohundreds of child safety-related requests per year.

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Evidence Blucora Benefits from Child Porn-related Search Traffic

"He who accepts evil without protesting against it is really cooperating with it." - Martin Luther King, Jr.

child.webcrawler.com – Daily Ad budget for this shady sub-domain has increased dramaticallyfrom Q3 to Q4 2013. They keywords used to generate traffic include child pornography-relatedterms46:

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Webcrawler.com Places Child Pornography Ads on Google47

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Child Pornography Ads on Google Blucora Removed Recently

The following search results were visible through January. We wonder if Professor Edelman’s Blinkx postfrightened BCOR, or BCOR wanted to window dress before Google negotiations:

Instead of webcrawler.com, info.com (listed as one Blucora’s distribution partner several years ago; wesuspect the two are secretly business partners) now shows ads related to these child porn terms48:

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3 of the top 10 keywords to Dogpile.com are child pornography-related terms49:

Why we Believe Webcrawler.com and Dogpile.com may be a Refuge for Pedophiles

Compare the auto-filled results for dogpile and webcrawler vs. google, when the word ‘child’ is typed50:

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Blucora’s History of Bad Behavior: The Iminent.com Problem

Iminent.com of 2013-2013 = WhenU.com of 2010?

In 2004, WhenU.com was banished by Google and Yahoo! for distorting search rankings1:

Top search engines Google and Yahoo! have removed direct links to WhenU.com after thecontroversial on-line ad company was found guilty of 'cloaking', an optimisation technique thatdistorts search rankings.

Google cracked down on WhenU.com after Harvard Business School Professor, Benjamin Edelman,alleged that WhenU was using at least thirteen cloaking sites in "an attempt to hold multiple positions insearch engine results bearing WhenU's name".2

By 2010, WhenU.com somehow resurfaced as spyware, scheming this time with Infospace/Blucora.Edelman pointed out their complicit wrong-doing.3 BCOR took notice4:

“During the first half of 2010, we discontinued the syndication of our search results to certaindistribution partners who we deemed to be delivering low quality clicks. Those discontinuationshad a material negative impact on our revenues for the first half of 2010.” – August 2010

Blucora/Infospace is a Repeat Offender, as Documented by Edelman Below5

Flipping through my records of prior InfoSpace observations, I was struck by the half-decade of badbehavior [2005-2010]. Consider:

June 2005: I showed InfoSpace placing Google ads into the IBIS Toolbar which, I demonstrated inmultiple screen-capture videos, was arriving on users' computers through security exploits (withoutuser consent). The packet log revealed that traffic flowed from IBIS directly to InfoSpace's Go2net.com-- suggesting that InfoSpace had a direct relationship with IBIS and paid IBIS directly, not via anyintermediary.

August 2005: I showed InfoSpace placing ads through notorious spyware vendor Direct Revenue(covering advertisers' sites with unlabeled popups presenting their own PPC ads). The packet logrevealed that traffic flowed from Direct Revenue directly to InfoSpace -- suggesting that InfoSpace hada direct relationship with Direct Revenue and paid Direct Revenue directly, not via any intermediary.

August 2005: I showed InfoSpace placing ads through notorious spyware vendor 180solutions/Zango.The packet log revealed that traffic flowed from 180solutions directly to InfoSpace -- suggesting thatInfoSpace had a direct relationship with 180solutions and paid 180solutions directly, not via anyintermediary.

February 2009: I showed InfoSpace placing Google ads into WhenU popups that covered advertisers'sites with their own PPC ads.

May 2009: Again, I showed InfoSpace using WhenU to cover advertisers' sites with their own PPC ads,through partners nearly identical to the February report.

January 2010 (last week): I showed InfoSpace's still placing Google ads into WhenU popups and stillcovering advertisers' sites with their own PPC ads.

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Blucora/Infospace Offenses Continue Through 2014, Marking a Decade+ of Wrongdoing

As we’ve shown earlier in this report and the appendix, BCOR’s search traffic shenanigans continueunabated. We would like to highlight Blucora’s recent and current malfeasance tied to Iminent.com.

According to Blucora’s most vocal shareholder (who incidentally was a shareholder of many now-provenChinese reverse merger frauds), Iminent.com is one of Blucora’s model customers6:

–

This Blucora shareholder did not do his due diligence, just as he did not do his due diligence beforepurchasing Chinese reverse mergers stock frauds7:

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It Gets Worse: We have a video and we document the Infospace/Iminent scam in real-time8

1. This video captures the Infospace/Iminent scam in real time. Note several instances of misrepresentation, specifically cloaking (i.e. search engines see one

thing, and visitors see something else). Pop-ups open without consent. Iminent.com is referred to as a virus, browser hijacker, adware, spyware, and more9. The Infospace/Iminent scam resembles the Infospace/WhenU scam Edelman exposed. Appears to be in violation of Google’s terms of agreement, and also applicable laws.

The Smoking Gun: Infospace/Iminent Cloaking with Search Ads, in Violation of Google Guidelines

This screen sufficiently shows Infospace cloaking10:

Cloaking is considered a violation of Google’s Webmaster Guidelines11:

Cloaking refers to the practice of presenting different content or URLs to human users and searchengines. Cloaking is considered a violation of Google’s Webmaster Guidelines because it provides ourusers with different results than they expected.

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Google is Better off without Infospace/Blucora

On Oct 30, 2013, Babylon’s shares declined -62%, as Google walked away from Babylon1:

The shares of the company that got more than 40 percent of its revenue from the collaboration[with Google], plunged 62 percent, the most since they started trading in Israel. Google toldBabylon it won’t renew the contract ending Nov. 30 following complaints about the Or Yehuda,Israel-based company’s toolbar, Google’s decision threatens the whole industry, Babylon’s ChiefExecutive Officer Alon Carmeli said. “We are the first to experience these events,” he said in astatement to the exchange. The company is studying the implications and working to adapt tothe new reality, Carmeli said. “This could mean a change in the toolbar model and this is bad forthe industry.

Gotham City Research believes Blucora is worse than Babylon, Google is Better off without BCOR

The following support our beliefs:

Blucora is worse than Babylon, when it comes to illicit search traffic, as evidenced by the childporn and pirated content searches and clicks (see earlier sections for more).

Google prohibits any advertising related to child pornography. Blucora’s search results violate guidelines articulated in BCOR/GOOG 2011 amended agreement. BCOR has a long (and growing) track record of a variety of wrong-doing. Google is economically better off without Blucora. Google has more reasons to drop BCOR today than it did in 2010, when Edelman suggested it.

Severing Ties with Blucora would Bolster Google’s Recent Commitment to Combat Child Pornography

2 weeks after Google cut ties with Babylon, it publicly responded to UK Prime Minister David Cameron2:

Leading search engine companies Google and Microsoft have agreed measures to make it harderto find child abuse images online. As many as 100,000 search terms will now return no resultsthat find illegal material, and will trigger warnings that child abuse imagery is illegal.

David Cameron has welcomed the move but said it must be delivered or he would bring forwardnew legislation. Child protection experts have warned most images are on hidden networks.

In July, Mr Cameron called on Google & Microsoft's Bing - which together account for 95% ofsearch traffic - to do more to prevent people getting access to illegal images. He said theyneeded to ensure that searches which were unambiguously aimed at finding illegal imagesshould return no results.

But Jim Gamble, former head of the Child Exploitation and Online Protection Centre (Ceop), toldBBC Breakfast he did not think the measures would make any difference with regard toprotecting children from paedophiles."They don't go on to Google to search for images. Theygo on to the dark corners of the internet ...”

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Google has a zero-tolerance Policy on Child Pornography & Prohibits any Advertising Related to it

According to Google3:

Google is deeply committed to providing a healthy and trusted online environment for all of ourusers, and especially children. While the Internet provides an amazing opportunity for people toconnect with useful information, some online material poses serious risks to children and families,and some online behavior violates the law and should be eradicated. Child pornography, inparticular, is a horrific and vicious crime. Today, I testified before the House of RepresentativesSubcommittee on Oversight and Investigations about Google’s efforts to keep kids safe online.Among the initiatives that I highlighted:

- Google has a zero-tolerance policy on child pornography. We prohibit any advertising relatedto child pornography. When we become aware of child pornography anywhere in our searchengine or on our site, we immediately remove and report it to the appropriate authorities.

- We work closely with law enforcement to help track down child predators, and respond tohundreds of child safety-related requests per year.

Ads on Search Results Violate Google Requirements per 2011 Amended Agreement

We’ve found at least 2 kinds of direct violations:

There are more than 3 ads displayed, despite Google allowing for UP TO 34

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We see ads displayed in the middle of search results, where only organic results should beplaced (in fact, it seems ads take up more space than organic search results):

Zoomed in:

4 ads, instead of 3

Ads in middle ofsearch results, inlieu of moreorganic results.

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Low quality ads – the ads displayed on the top are nearly identical to those on the bottom

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Ads are repetitive, only take up space

AMENDED AND RESTATED GOOGLE SERVICES AGREEMENT5

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Even if Google and Blucora Renew their Agreement in March 2014, Google Can Walk Away Any Time

Straight from BCOR SEC filings6:

If Google or Yahoo! believe that we or our search distribution partners have failed to meet therequirements and guidelines or the Search Customer agreements, they may suspend orterminate our or our distribution partners’ use and distribution of their search products andservices, with or without notice, and in the event of certain violations, may terminate theiragreements with us. We and our distribution partners have limited rights to cure breaches of therequirements and guidelines.

Failure by us or our search distribution partners to comply with the guidelines promulgated byGoogle and Yahoo! may cause that Search Customer to temporarily or permanently suspend theuse of its content or terminate its agreement with us, or may require us to modify or terminatecertain distribution relationships.

Restrictions on our ability, & the ability of our search distribution partners, to distribute, market,or offer search-related applications, products, and services may impact our financial results.

A significant portion of our Search revenue is dependent on business models that can benegatively impacted by changes in policies or technology. For example, many of our Searchdistribution partners distribute applications, extensions, or toolbars that are monetized throughthe search services that we provide. Our Search Customers require that such applications,extensions, or toolbars, and the distribution of those applications, extensions, or toolbars,comply with certain guidelines. Our Search Customers can and do modify these guidelinesfrom time to time, and recent modifications of these guidelines may impact the distribution ofapplications, extensions, or toolbars that drive traffic and revenue to our search services. Inaddition, our Search Customers’ guidelines have in the past, and may in the future, negativelyaffected our ability, and the ability of our search distribution partners, to drive traffic to oursearch services through the use of search engine marketing.

Further, certain third parties have introduced, and can be expected to continue to introduce, newor updated technologies, applications, and policies that may interfere with the ability of users ofsearch services provided directly by us or by our search distribution partners to access thoseservices. For example third parties have introduced technologies and applications (including newand enhanced web browsers) that prevent users from downloading the extensions or toolbarsprovided by some of our search partners. Those applications may also have features and policiesthat interfere with the functionality of search boxes embedded within extensions and toolbarsand the maintenance of home page and other settings previously selected by users.

Any changes in technologies, applications, and policies that restrict the distribution, marketing,and offering of search-related applications, extensions, toolbars, products, and services mayimpact our operating and financial results.

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Google is economically better off without Blucora

The BCOR shareholder describes the economics of BCOR search business7:

If the above is correct, Google will retain a greater percentage of the $1 described if it severs itsties with BCOR.

Given how terrible (in quality) BCOR’s search results are, it’s not clear what BCOR is bringing tothe table to earn 80% of the economics. And this is only on the legitimate searches.

The above analysis only addresses the upside return, not the downside risks. If UK PrimeMinister David Cameron, or other politicians probe Google and Blucora’s child porn searchresults & ads, Google bears a disproportionate amount of the financial & reputational risks.

If Google does not renew its agreement with Blucora, it eliminates the downside risks, andcaptures all of the upside potential.

Google has more reasons to drop BCOR today than it did in 2010, when Edelman suggested it

Professor Benjamin Edelman has publicly recommended (on several occasions) that Google should, “FireInfoSpace; there's zero reason for this relationship to continue in light of InfoSpace's repeated failings”.We’ve documented some of his statements & reasoning earlier in this report. Here is more8:

The Impropriety of Google's Relationship with InfoSpace

In my view, Google's relationship with InfoSpace is ill-advised for at least three reasons:

First, InfoSpace has a track record of improper placements of Google ads. InfoSpace is implicatedin all three of the placements detailed above -- misplacements that have continued over alengthy period despite ample notice and opportunity for correction. Furthermore, I havepersonally observed other improper placements by InfoSpace. (Perhaps I'll post more in a furtherpiece.) Google need not continue to do business with a distributor with such a poor track record.

Second, Google does not need a distributor whose business model entails farming out adplacements to subdistributors. If InfoSpace's subdistributors seek to distribute Google ads, and tobe paid for doing so, let them apply directly to Google and undergo Google's ordinary qualitycontrol and oversight. Inserting InfoSpace as an additional intermediary serves only to lessenaccountability.

Third, InfoSpace's corporate history undermines any request for lenience or forgiveness. TheSeattle Times chronicles InfoSpace's accounting fraud in a three-part investigative report, "Dot-Con Job. The Seattle Times byline summarizes their findings: "Investors were cashing outmillions, and faithful investors were left with pennies." Hardly a mark of trustworthiness!

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Ties that Blind: “You’re only as good as the company you keep”

The Ties that Blind

By now, we expect readers to wonder how Infospace/Blucora could possibly get away with all thecurrent and past misdeeds highlighted in this report. Gotham City Research believes the following havecontributed to the company’s misbehavior leading to the present:

No senior Blucora/Infospace executive has ever faced criminal liability, to date, despite themany and repeated examples of management and corporate malfeasance throughout its history.

The current management team (a few key members have been with the company for 5-15years), has been conditioned to believe it can engage in any risky/improper behavior, and neverface personal liability; only upside.

Most, if not all, of the misbehavior that we & Professor Edelman describe occurred undercurrent Management’s watch.

Nearly all BCOR CEOs have eventually resigned amid some prevailing controversy, at the time. Blucora’s distribution partners include some (at best) controversial outfits, as well as some

proven rogue operators. The company does not reveal their identities for a reason.

A Closer look at Management

“There is some good in the worst of us and some evil in the best of us" –Dr. Martin Luther King Jr.

Gotham City Research finds it very concerning that all the search-related violations we documented inthis report, and many of the improprieties Professor Edelman documented between 2005-2010,happened under the current Chairman, CEO, CFO, and Infospace President’s presence1:

Eric Emans, a long-time Infospace/Blucora employee, is the Chief Financial Officer. He was theChief Accounting Officer prior to being appointed CFO, and worked for Deloitte & Touche(BCOR’s long-time auditor, up to 2012) before joining Infospace in the early 2000s.

Michael Glover heads the search segment, and has been with BCOR since 2000. William J. Ruckelshaus became the company’s president and CEO in November 2010 after

serving as a board member since May 2007. Ruckelshaus had no prior CEO experience. John E. Cunningham, IV has served as director of the company since July 1998 and as the

chairman of the board of directors since January 2011. He also served as lead independentdirector from February 2010 through December 2010. He is a member of the Audit Committee.

Mr. Cunningham’s brother, James S. Cunningham, is an employee of the Company who isserving as one of the Company’s managers of business development.

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Info.com – Distribution Partner of the Past, Present, or Both?

From BCOR 2006 10K2:

Recall from our earlier child pornography section that webcrawler.com’s illicit ads related to the ‘vladmodel’ disappeared recently, only to be replaced by info.com ads for the same illicit terms3:

webcrawler.com advertised the same terms through January :

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Info.com and Blucora Appear to Have Some Kind of Relationship4

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Blinkx and Blucora – Partners of the Past, Present, or Both?

June 25, 2007 – According to an Infospace press release5: “InfoSpace Partners with blinkx to Offer VideoSearch Functionality on Award-Winning Dogpile.com”

January 12, 2010 – According to Professor Edelman’s, “Google Click Fraud Inflates Conversion Rates andTricks Advertisers into Overpaying”, AdOn Networks (a subsidiary of blinkx as of 2012) and Infospacewere part of the same scheme6:

November 30, 2010 – “Blinkx hasn’t become a household name like YouTube, in part because the lion’sshare of its business is providing video search services to other companies, such as Ask.com, RealNetworks, and Infospace.” 7

January 28, 2014 – According to Professor Edelman’s, “The Darker Side of Blinkx”: “I show the ex-AdOntraffic broker still sending invisible, popup, and other tainted traffic.”8

According to Alexa9:

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Blinkx and Blucora – Mere Coincidences?10

https://www.linkedin.com/pub/pavel-lyadnov/23/160/70a

Blinkx and Blucora 10 minute drive (<5 miles away from each other) according to google maps11

http://www.yellowpages.com/bellevue-wa/mip/blinkx-460664010

We called the listed phone number, and surely it is Blinkx.

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The Controversial Babylon Was/Is a “Strategic Partner” of Blucora12

https://www.linkedin.com/in/shakedtal

Intelius and Blucora – Partners of the Past, Present, or Both?

Founder and former CEO of Infospace.com Naveen Jain (with other former Infospace employees )founded Intelius13:

After leaving InfoSpace Jain started a new company, Intelius, across the street from his oldoffices in Bellevue, Washington. Intelius has been on the receiving end of hundreds of consumercomplaints alleging fraud, many of which are around a partnership the company has withAdaptive Marketing and a “product” they offer called Privacy Matters Identity. Every time acustomer buys a product at Intelius, they are shown a page telling them “Take our 2008Consumer Credit Survey and claim $10.00 CASH BACK with Privacy Matters Identity.”

January 1, 2008 – from Intelius S-1 (it never went public)14: “We have established relationships withleading online portals and directories, including Idearc, InfoSpace, MSN, Yahoo! andYELLOWPAGES.COM, that market our services on their websites and direct visitors to our websites.

June 2012 – Infospace changes its name to Blucora, and Intelius changes its name to Inome.15

Last but Not Least, Let’s Not Forget Iminent.com

As we’ve documented earlier in this report, Iminent.com is a deeply troubling, current Blucora partner16:

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Non-GAAP is Back

InfoSpace bubble-era accounting highly "complicated": historical background

According to USA Today1:

InfoSpace used complicated accounting methods in an attempt to reach Wall Street's revenueexpectations during the aftermath of the dot-com frenzy, The Seattle Times reported this week.

The deals helped the once high-flying technology company please Wall Street analysts even as itsmuch-vaunted business was not performing as well as executives had hoped, the newspaper said.

After Naveen Jain was forced out, Jim Voelker took over as CEO, and stopped reporting non-GAAP,“profits before all the bad stuff”2:

The company's revenues today are solid, Voelker said. By the time he took over, the companyhad already stopped the dubious practice of investing in companies in exchange for business."There weren't any lazy Susan deals out there," he said.

Voelker ended the company's practice of reporting pro-forma profits, which critics dubbed"profits before all the bad stuff" and which didn't meet general accounting standards.

Jim Voelker resigned as CEO in 2009, and as Chairman in 2010. BCOR’s post-Voelker accounting anddisclosure practices concern us for the following reasons:

CEO William Ruckelshaus reintroduced Non-GAAP reporting in 2011. The irregularities betweenBCOR’s GAAP and Non-GAAP are troubling.

Over 50% of cash flows from operating activities are a result of increases in “Accrued expensesand other current and long-term liabilities”, in the last few quarters.

Blucora purchased Make The Web Better, a distribution partner (a rare instance whereby BCORactually names a partner). We suspect there’s a “lazy susan” element to this transaction.

Accounting Goodwill seems inflated. Economic goodwill seems quite negative. Between 2007 to date, BCOR filed 36 comment and response letters with the SEC (vast majority

post 2011). Auditor change – Deloitte to Ernst and Young. Timing is interesting (just around the merger time) Audit fee declining $789K to $433K from 2011 to 2012, even as company grew in complexity. Former Blinkx staff accountant is now a Blucora staff accountant. Less distribution partner disclosure today compared to Voelker’s time.

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The Return of Non-GAAP Accounting

As soon as William J. Ruckelshaus became CEO, he re-introduced the previously taboo Non-GAAPaccounting to Blucora. Since then, Non-GAAP net income has consistently exceeded GAAP net income,and Non-GAAP net income has grown at a faster rate than GAAP net income3:

Quality of Cash Flow (not just Earnings) Suspect as Well

~50% of cash flows from operating activities are a result of increases in “Accrued expenses and othercurrent and long-term liabilities”, in the last few quarters.4

The Curious Case of Make The Web Better: a Lazy Susan Transaction?

Infospace.com in the past5:

However, Jain later renegotiated the deal with his brother to try to dramatically boostInfoSpace's struggling revenues.

They came up with a plan: InfoSpace would buy an $8 million interest in netgenShopper, which inturn would send $5 million of it back as payment to InfoSpace for promotional services.Specifically, InfoSpace agreed to send out e-mails to potential customers and guaranteed anenormous number of hits on netgenShopper's online ads.

It was the kind of deal that InfoSpace insiders referred to as "buying revenue" or "a lazySusan" because the cash the company gave out came right back to it as revenue.

Non-GAAP vs. GAAP Net Incomethousands $s 2011 2012 2013 YTD

Non-GAAP Net Income $28,764 $70,760 $79,599GAAP Net Income $21,594 $22,526 $25,533

$ Variance $7,170 $48,234 $54,066Variance as % of GAAP NI 33.2% 214.1% 211.7%

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Revenue generated from search traffic on the Make The Web Better site was $3.1 million in 2012, $8.2million in 2011, and $16.4 million in 20106:

What happened? How did MTWB revenue decline to zero by 2013 (there is no mention in the 2013filings), even as total search revenue has doubled in that time? Also it appears Blucora has yet to makethe necessary impairments to earnings (i.e. the balance sheet is inflated).

The http://www.make-the-web-better.com/ website is off-line; impairment seems appropriate:

SEC Correspondence and Comment letters are concerning

There are 36 of them. As shown in the table below, between 2007 to date, BCOR filed 36 commentletters with the SEC. While the number of exchanges with the SEC does not guarantee an investigation,the arrogance and disrespect towards the SEC that is evident in BCOR rebuttals may not please them7:

Make The Web Better Revenuemillion $s 2010 2011 2012

MTWB Revenue $16.4 $8.2 $3.1Search revenue $214.3 $228.8 $344.8

MTWB Revenue growth (50.0%) (62.2%)MTWB Revenue growth 6.8% 50.7%

Type Company Received Type Company Received Type Company ReceivedLETTER BLUCORA, INC. 11/04/13 LETTER BLUCORA,

INC. 11/30/12 LETTER BLUCORA,

INC. 03/20/09

LETTER BLUCORA, INC. 11/04/13 CORRESP BLUCORA,INC.

11/30/12 LETTER BLUCORA,INC.

03/20/09 CORRESP BLUCORA, INC. 11/04/13 CORRESP BLUCORA,


INC. 03/20/09

CORRESP BLUCORA, INC. 11/30/12 CORRESP BLUCORA,INC.

04/26/11 CORRESP BLUCORA,INC.


INC. 04/26/11 CORRESP BLUCORA,

INC. 03/20/09

CORRESP BLUCORA, INC. 11/30/12 LETTER BLUCORA,INC.


03/20/09 LETTER BLUCORA, INC. 11/30/12 LETTER BLUCORA,


INC. 09/07/07

LETTER BLUCORA, INC. 11/30/12 LETTER BLUCORA,INC.


09/07/07 LETTER BLUCORA, INC. 11/30/12 LETTER BLUCORA,


INC. 09/07/07

LETTER BLUCORA, INC. 11/30/12 CORRESP BLUCORA,INC.




INC. 09/07/07

CORRESP BLUCORA, INC. 11/30/12 CORRESP BLUCORA,INC.


09/07/07

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BCOR Audit Fee Declines -45%

We find the timing of a dramatic reduction in BCOR’s audit fee suspicious given8:

BCOR changed from its long-time auditor, Deloitte and Touche, to Ernst and Young BCOR re-introduced Non-GAAP net income the very same year (something that, perhaps, its old

auditor would not allow) BCOR growing acquisition activity and complexity

Distribution Partner Disclosure: Opacity Today vs. Transparency in Voelker’s Day

The Voelker age (when Non-GAAP was banned)9:

versus the reign of CEO Ruckelshaus10:

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BCOR Shares Are Worth No more Than $5.00 per Share

BCOR is Misunderstood by its Shareholders

“A Turkey is fed for 1000 days—every day confirms to its statistical department that the human racecares about its welfare ‘with increased statistical significance’. On the 1001st day, the turkey has asurprise.” 1

Blucora’s peer, Babylon, can relate to the Turkey and Indymac2:

Blucora’s business is structurally fragile, built on a foundation of hidden risks. It additionally faces anarray of immediate downside catalysts.

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The Known Unknown

Let’s compare Blucora against Babylon:

Blucora derives 60+% of revenue from Google vs. 40% for Babylon3

Google decided not to renew its contract with Babylon, after receiving a large number ofcomplaints. Blucora’s offenses are well documented in this report and elsewhere.

Blucora’s search traffic has benefited from child porn and pirated content searches, asdocumented in this report. Google prohibits advertising related to child pornography.

Even if Google and Blucora Renew their Agreement in March 2014, Google Can Walk Away Any Time

The immediate risk for shareholders is the upcoming March 2014 Google deadline. However, the riskremains afterwards. BCOR is the Thanksgiving turkey, the March 2014 deadline is Thanksgiving day, andGoogle can designate any future day as Thanksgiving day:4

If Google or Yahoo! believe that we or our search distribution partners have failed to meet therequirements and guidelines or the Search Customer agreements, they may suspend orterminate our or our distribution partners’ use and distribution of their search products andservices, with or without notice, and in the event of certain violations, may terminate theiragreements with us.

We and our distribution partners have limited rights to cure requirement/guideline breaches. Failure by us or our search distribution partners to comply with the guidelines promulgated by

Google and Yahoo! may cause that Search Customer to temporarily or permanently suspend theuse of its content or terminate its agreement with us, or may require us to modify or terminatecertain distribution relationships.

The Unknown Unknowns: Shareholders are missing the $400+ million Problem

Blucora’s search revenue growth since 2010 has come at the cost of building hidden risks into thebusiness, rendering it more fragile today than in 2010 (though it looks stronger to the unsuspecting):

FTC, DOJ, FBI, IRS, &/or the SEC – If any of these entities investigates BCOR (and we believe theyhave plenty of cause to do so), we estimate liability to easily exceed $200 million for BCOR.

Child Pornography is a Federal Crime, Period – Wall Street and Blucora shareholders fail tounderstand how criminal liability works in practice. If a man is caught watching childpornography, he faces criminal liability, regardless of whether he only spends 10.0%, 1.0%, 0.1%,or 0.01% of his time watching child pornography.

Trial Attorney, Class Action – If a capable lawyer were to sue Blucora, on behalf of all themalware and related victims (the elderly, advertisers, etc), we estimate liability at $200+ million.

Blucora’s Search Business Banned – If Infospace.com, etc. were to disappear tomorrow, no onewill care, and no one will notice. Given the on-going malfeasance we’ve uncovered, and itshistory of committing wrong-doing, a few probes seem well-warranted.

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Why we believe Blucora’s shares are worth no more than $5.00/share

We estimate GAAP earnings will decline to ~$15 million, if revenue from Google declines ~10%.10% of revenue from Google is ~$36 million, and at a ~40% gross margin, results in a ~$14million decline in earnings. 2013 TTM net income of $29 million less $14 million = ~$15 million.

At a 14x P/E multiple, $15 million in earnings gets us to $5.00 per share.

Why we believe Blucora’s shares easily approach <$1.00/share

BCOR has been burning cash in the last few years, just as it should be hoarding cash (to offsetagainst the unacceptable search-related risks it has quietly been taking)5

Tangible book value is now negative, leaving no downside protection. We believe the companyhas material NEGATIVE economic goodwill, due to its shady business practices6

The Company has very few reserves against a disruptive adverse development7

TaxAct and Monoprice’s importance is diminished, in our view, because Infospace is large andimportant enough to bring the whole house of cards down. That being said, we think TaxAct andMonoprice provide $1-$2 per share in downside protection. NOLs are of negligible value, giventhe risks we’ve identified in this report. NOLs cannot fund fines and restitution.

BCOR Has Not Generated Lasting Free Cash Flowthousands $ 2008 2009 2010 2011 2012 YTD

Cash Flow from Operations ($38,180) $30,000 $49,906 $25,263 $48,831 $65,388Cash Flow from Investing ($12,277) ($2,435) ($10,894) (2,679) ($283,142) ($187,566)

Free Cash Flow ($50,457) $27,565 $39,012 $22,584 ($234,311) ($122,178)Cumulative Free Cash Flow ($50,457) ($22,892) $16,120 $38,704 ($195,607) ($317,785)

Tangible Book Value has Been Declining Rapidly, Now Negativethousands $ 2008 2009 2010 2011 2012 ytd

Book value $262,324 $279,835 $301,771 $355,105 $415,450 $483,634goodwill $44,123 $44,815 $44,815 $44,815 $230,290 $343,139

Intangibles $0 $457 $3,910 $1,315 $132,815 $185,421Tangible book value $218,201 $234,563 $253,046 $308,975 $52,345 ($44,926)

Tangible Net Capital Has Decreased Sharply as Leveraged has Increasedthousands $ 2008 2009 2010 2011 2012 ytd

Current assets $210,067 $260,342 $292,434 $321,070 $212,073 $337,726Current liabilities $26,225 $40,867 $42,217 $39,196 $50,967 $97,830

Working Capital $183,842 $219,475 $250,217 $281,874 $161,106 $239,896Debt $0 $0 $0 $0 $82,842 $180,725

Net-net $183,842 $219,475 $250,217 $281,874 $78,264 $59,171

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Appendix A: Blucora and Malware

Accompanying notes to the following table presented in Blucora = Involuntary clicks + Artificial clicks +Illicit clicks:

Comments: All BCOR properties have an unusually % of (A) elderly (B) foreign-based visitors

Webcrawler.com – Alexa ranks WebCrawler as the 400-500th most trafficked site on theInternet in the world; it was ~7,000th just two year ago. For starters, this is too good to be true,does not pass the “sniff test” (when is the last time you heard about webcrawler, outside thisreport?). We conservatively estimate that 33% of webcrawler.com is suspect because:

1. Over 90% of webcrawler’s top search terms are unrelated and generic keywordsHotmail, youtube, and facebook. This does not prove click fraud, but it is consistent withdocumented incidences of click fraud. Google delivers no adwords for these terms.

2. Instead, we find that webcrawler is an aggressive acquirer child pornography terms (asshown earlier).

3. Fantastigames.webcrawler.com is a tricky browser hijacker that presents itself as alegitimate search engine. Most certainly consistent with driving suspect traffic.

4. 80% of webcrawler.com’s visitors originate from outside North America, specificallyover 33% of “visitors” originate from India, Pakistan, Indonesia, Nigeria, and Bangladesh.India is a well known hot spot for click fraud.

Infospace.com –css.infospace.com, is a proven virus/browser hijacker and 94+% ofinfospace.com traffic is directed to it.

metacrawler.com – metacrawler.com seems defunct, and even redirects traffic to zoo.com,which has a popularity ranking an order of magnitude less than metacrawler (this makes nosense). So we assume 100% traffic currently and going forward is suspect.

dogpile.com – We find the % of suspect traffic similar to webcrawler.com for similar reasons.

Weight Suspect % of TotalBCOR PROPERTY Factor* Traffic** Traffic**webcrawler.com 62.9% 33.0% 20.8%

Infospace.com 15.5% 94.8% 14.7%metacrawler.com 12.6% 100.0% 12.6%

dogpile.com 9.0% 33.3% 3.0%TOTAL SUSPECT TRAFFIC: 51.0%

*Weight factor - the importance of traffic, relative to BCOR's total traffic. based on rankings.**Suspect Traffic - Involuntary, artificial, illicit, and otherwise irrelevant traffic.***% of Total Traffic - each properties % contribution to total traffic. Weighted average of*** (continued) the Suspect Traffic and the Weight Factor, respectively.

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What’s Behind Blucora’s Distributed search growth

Defining characteristics of most, if not all Blucora’s branded search engines:

Classified by experts as malware, spyware, viruses, and/or (best case) “malicious software”. Difficult to remove. There are detailed instructions in all above cases, “how to remove” Low quality traffic, involuntary traffic Preys on the elderly, poor English speakers, and those who are busy / not attentive to detail.

A list of the malware we found associated with Blucora

Do a simple search for ‘blucora malware’

Documented examples of virus/malware activity

What is the Fast Browser Search virus (redirect)? The Fast Browser Search virus, also referred toas the fastbrowsersearch.com redirect, is potential malware developed by Blucora (Infospace)categorized as a browser hijacker. http://botcrawl.com/how-to-remove-fast-browser-search/

What is Metacrawler (Metacrawler.com)? Metacrawler Toolbar is a malware add-on/extensionwhich installs to internet browsers with or without user consent. http://botcrawl.com/how-to-remove-metacrawler-toolbar-malware-and-infospace-viruses/

Remove infospace.com virus. How to uninstall searchhttp://www.rescuemybrowser.com/infospace-com-virus-removal

How to uninstall (remove) Gamers Unite Snag Bar (coolchaser.infospace.com) see video:http://www.youtube.com/watch?v=ZgOTxk-TkEQ

Recent Blucora and related malware, browser hijackers, and viruses1 dogpile search removal tool2 fantastigames.webcrawler.com3 metacrawler.com virus4 Iminent.com (customer)5 Fast Browser Search virus6 infospace.com virus7 Gamers Unite Snag Bar (coolchaser.infospace.com)8 wsdsold.infospace.com/pemonitorhosted/ws/index9 infospace.com/pemonitorhosted/search/home10 Css.infospace.com Virus11 Airzip.inspsearch.com Browser Hijacker12 i.search.metacrawler.com

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Infospace.com is a fraudulent web search engine

“Infospace.com is a fraudulent web search engine which includes two parts namedstart.infospace.com and dsclick.infospace.com. Infospace.com, actually, doesn’t work and isassociated with browser hijackers and rootkits such as Google Redirect Virus and ZeroAccessrootkit.

Browser hijackers and rootkits involve a tracking cookie which helps cybercriminals to changesearch results on Google and other major search engines and redirect Internet users toInfospace.com and other malicious advertisement websites. Browser hijackers and rootkitslinked to Infospace.com also use the tracking cookie in a try to deliver ads and collect PC users’personal information in order to transmit it to remote cybercriminals. After taking over theaffected web browser, these infections can change your default homepage and search engine.Infospace.com won’t provide you any reliable and safe search engine services. If you try tosearch for a certain keyword on any renowned search engine, eventually, you will get nothingrelated to your query because your search results are changed to links unrelated to your queryinstantly once you click on some of them, and you get diverted to Infospace.com. You shouldconfigure your browser settings and remove all browser hijackers and rootkits to block irritatingdiversions to Infospace.com.”

Source: http://www.enigmasoftware.com/infospacecom-removal/

Simple search of ‘infospace.com’:

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Css.infospace.com is a malicious advertising platform

Css.infospace.com is a malicious advertising platform used by several rogue adware and wickedprograms to display pop-up ads and advertisements in different browsers say Firefox, Internet Explorerand Google Chrome. It enables search from the address bar of the web browser and redirects you tomalicious web pages. It tracks the browsing behavior or Internet activity of the user intelligently and alsocollects data and sends them to hackers who misuse them for their own benefit. Once it gets into thecomputer system it may load unnecessary useless files to slow-down computers functionality and causesfurther serious issues especially related to entrapment and invasion of privacy. It also mess up with theprivacy settings of the browser and steals personal files and information. Css.infospace.com willcompromise your PC resources and disable certain functions due to which you may find issues in runningor executing some of the application of the system. There is no doubt that Css.infospace.com is adangerous malware and keeping it on the system will not do anything good for the PC. So, just make aneffective move to remove Css.infospace.com from the PC as soon it is detected.

Is Css.infospace.com Safe for PC & Browser?

No absolutely not, Css.infospace.com is not safe to use at all and it is because of the reason concerningsevere cyber criminal activities, exploitation of privacy and depletion of computer functionality andperformance. Some points that justifies the statement made above are listed below –

It installs in the computer system without user’s permission or consent often with free downloads. It changes existing browser settings including provided search engines and home pages causing

it to redirect to related malicious websites. As a tactic against innocent Internet users, it appears alike some legitimate search engine like

Google.com and persuade victims to use illegitimate search engine. It often mess up with the privacy settings and exploits them to steal personal files or information.

Source: http://www.keepbrowsersafe.com/remove-css-infospace-com-get-rid-of-css-infospace-com-from-pc

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New fraud (infospace scam) found, software bundle that is distributed on a torrent sites

{0 Comments}Posted by Simon Dougal on February 12, 2013

in Malicious activities, Notifications

Hey guys, so we found one new fraud, we found one software bundle that can be found on fewtorrent sites: eztv.it and extratorrent.com …This software bundle is signed with Cool Mirage ltd.

CN = Cool Mirage ltd.

O = Cool Mirage ltd.

STREET = ogarit 39

L = tel aviv

S = tel aviv

PostalCode = 69016

C = IL

This software bundle has few variations that you can see from video we made, installer downloads 3files:

http://www1.INSTALLSTARTER.com/TornTVApp.exe

http://www1.INSTALLSTARTER.com/newyontoo-c2.exe

http://www1.INSTALLSTARTER.com/IminentSetup645.exe

Also it has offer screen for all of them, on the end you have TornTV application which can be usedto watch copyrighted sport games, Iminent toolbar which also installs Iminent search engine andhomepage. Iminent toolbar sets http://start.iminent.com/ as homepage

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and http://start.iminent.com/StartWeb/1033/toolbox as search provider. Finally this bundle alsoinstalls one more product from company named Yontoo LLC.

Source: http://www.youtube.com/watch?v=nVGZca-VO-Y and http://secure-the-internet.org/?p=100

What Is Css.infospace.com Virus?

Css.infospace.com is a bogus search engine that can attack all popular web browsers, like IE, Firefox,Chrome and Google. Normally, this virus gets inside your PC with spam e-mail attachments, corruptwebsites and freeware installation packages. According to its infection symptoms, Css.infospace.comhas been classified as a kind of browser hijacker virus that should get rid of immediately.

Source: http://getridofallmalware.blogspot.com/2013/08/remove-cssinfospacecom-virus-completely.html

How popular is infospace.com ?

Alexa Traffic Ranks:

Search Traffic:

What percentage of visits to this site come from a search engine?

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Upstream SitesWhich sites did people visit immediately before this site?

Site Percent of Unique Visits

1. inspsearch.com 6.4%

2. snapdo.com 6.0%

3. iminent.com 3.2%

4. mysearchresults.com 2.9%

5. govome.com 2.7%

6. globososo.com 1.8%

7. facebook.com 1.5%

8. google.com 1.3%

9. babylon.com 1.3%

10. youtube.com 1.3%

Where do visitors go on infospace.com?Subdomain Percent of Visitors

ccs.infospace.com 94.81%

infospace.com 2.12%

search.infospace.com 0.91%

wsdsold.infospace.com 0.74%

reports.infospace.com 0.65%

utorrent.infospace.com 0.61%

coolchaser.infospace.com 0.54%

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Subdomain Percent of Visitors

gateway.infospace.com 0.16%

eastlink.infospace.com 0.13%

Webcrawler.com related malware

Fantastigames.webcrawler.com is a tricky browser hijacker that presents itself as a legitimate searchengine and sneaks in the computers without the consent of the user. Once installed, theFantastigames.webcrawler.com make a number of changes in your browser that includes the homepage, default search engine and desktop background. This malicious application has the ability toredirect all your browsing efforts towards unknown websites for the commercial purposes. TheFantastigames.webcrawler.com can infect all the major browsers including the Firefox, Chrome, Explorer,and Safari. Once it changes the vital settings in your browser, your screen will be flooded with theannoying pop-up ads to promote the affiliate products. The notorious hackers and cyber criminals usethis virus as a tool to access the computer and reach to the confidential financial information about theuser. By accessing the information like credit card numbers and passwords, these cyber crooks can stealyour money without your knowledge. This dangerous browser hijacker is also known as a resource eater,and can make your computer extremely slow once enter into the computer. Besides speed, the overallperformance also affected badly because of this infection.

The Manual Removal of Fantastigames.webcrawler.com

Once you confirmed the presence of the Fantastigames.webcrawler.com in your computer, you have

to delete this virus effectively to minimize the loss. This browser hijacker can be removed manually;

however, you must remember that the chances of the success of manual removal process very much

depend on your knowledge of removing such threats before. The instructions for the manual removal

of this infection are detailed below:-

Start the System in Safe Mode

In order to open your computer in the safe mode, you have to restart the computer, by pressing the

F8 key repeatedly to access to the boot options menu. Once you are able to see the boot options, you

have to select the safe mode and hit the Enter key.

Kill the Associated Processes

Open the windows task manager by holding the Ctrl+Alt+Delete keys together, and click on the

Processes tab to see the list of the running processes. Your goal is to find and delete the following

processes related to the Fantastigames.webcrawler.com virus:- %AppData%\[RANDOM CHARACTERS]\[RANDOM CHARACTERS].exe

Delete the Associated Files

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Access the system files folder and remove the following files that are considered as the associated

data of the Fantastigames.webcrawler.com :- %Desktopdir%\Fantastigames.webcrawler.com.lnk %Programs%\Fantastigames.webcrawler.com\Fantastigames.webcrawler.com.lnk

Reverse the Modification in the Windows RegistryClick on the start menu, select the Run option, and write “RegEdit” before pressing the Enter key toopen the registry editor. Once the registry editor is accessed, you have to remove the followingmalicious entries from the windows registry before closing the registry editor:-

HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Uninstall\Fantastigames.webcrawler.com\DisplayIcon %AppData%\[RANDOM CHARACTERS]\[RANDOMCHARACTERS].exe,0

HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Uninstall\Fantastigames.webcrawler.com

HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Uninstall\Fantastigames.webcrawler.com\UninstallString “%AppData%[RANDOM CHARACTERS][RANDOMCHARACTERS].exe” -u

HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\RunOnce\[RANDOMCHARACTERS] %AppData%\[RANDOM CHARACTERS]\[RANDOM CHARACTERS].exe

HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Uninstall\Fantastigames.webcrawler.com\ShortcutPath “%AppData%\[RANDOM CHARACTERS]\[RANDOMCHARACTERS].exe” -u

HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Uninstall\Fantastigames.webcrawler.com\DisplayName Fantastigames.webcrawler.com

Finally, you have to reboot your computer in the normal mode and see the result of recent changes

you have made. Run a complete the system scan after updating the antivirus program.

Source: http://spywareremovers.com/how-to-remove-fantastigames-webcrawler-com

Something called WebCrawler keeps hijacking my browser. How do I stop it?

So some website called webcrawler.com keeps opening literally half a dozen windows at a time anddirecting me to random websites, some of which aren't even in English. I've tried to remove it (since I'massuming it's a virus) using MalwareBytes, SuperAntiSpyware, Rkill, Norman Malware Cleaner, ANDHitman Pro. But it keeps coming back.

So: what do I have to do to get rid of it? Please help, if you have any idea!

Additional DetailsOh. Also, there IS no extra toolbar, and nothing on my list of programs called WebCrawler. So I can'texactly uninstall it.

Source: http://answers.yahoo.com/question/index?qid=20110815082540AAknHXN

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Dogpile.com Redirect Virus

Dogpile.com virus will do much harm to the infected computer: Dogpile.com virus is a dangerous browser hijacker virus. Dogpile.com virus changes the web browser settings. Dogpile.com virus replaces your home page and search engine. Dogpile.com virus collects and sends your private data for its servers. Dogpile.com virus may introduce other computer viruses. Dogpile.com virus slows down your Internet connection.

Source: http://pcvirusesremoval.blogspot.com/2013/10/remove-dogpilecom-redirect-virus.html

Another source, similar opinions:

Source: http://www.go-remove-malware.com/tag/dogpile-search-removal-tool/

And another:

Remove Dogpile.com redirect (Virus Removal Guide)

Dogpile Web Search is a browser hijacker, which is promoted via other free downloads, and onceinstalled it will change your browser homepage and default search engine tohttp://dogpile.com/.

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The Dogpile.com homepage will display advertisements and sponsored links in yoursearch results, and may collect search terms from your search queries. TheDogpile.com hijack is used to boost advertising revenue, as in the use of blackhat SEO,to inflate a site’s page ranking in search results.

Dogpile.com it’s technically not a virus, but it does exhibit plenty of malicious traits, suchas rootkit capabilities to hook deep into the operating system, browser hijacking, and ingeneral just interfering with the user experience. The industry generally refers to it as a“PUP,” or potentially unwanted program.

Dogpile.com is an ad-supported (users may see additional banner, search, pop-up, pop-under, interstitial and in-text link advertisements) cross web browser plugin for InternetExplorer (BHO) and Firefox/Chrome (plugin) and distributed through variousmonetization platforms during installation. The browser extension includes variousfeatures that will modify the default or custom settings of the browser including thehome page, search settings and in some cases will modify Internet Explorer’s load time

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threshold, place a lock file within Firefox to prevent competing software from zchangingits settings as well as disable the browser’s Content Security Policy in order to allow forcross site scripting of the plugin.

Dogpile.com homepage got on your computer after you have installed a freewaresoftware (video recording/streaming, download-managers or PDF creators) that hadbundled into their installation this browser hijacker.For example, when you install VPlay, you will also agree to change your browserhomepage and default search engine to Dogpile.com

However when you uninstall VPlay from your computer, your web browser’s defaultsettings will not be restored. This means that you’ll have to remove Dogpile.comhomepage from your favorite web browser manually.

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Source: http://malwaretips.com/blogs/remove-dogpile-virus/

Search result , while searching for ‘dogpile.com’

Who visits dogpile.com?

Metacrawler.com

Metacrawler Toolbar is a malware add-on/extension which installs to internet browsers with or withoutuser consent. http://botcrawl.com/how-to-remove-metacrawler-toolbar-malware-and-infospace-viruses/

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Who visits metacrawler.com

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Appendix B: A Closer Look at Blucora’s 2005-2010 Impropriety

Source: http://www.hbs.edu/faculty/Pages/profile.aspx?facId=417579

Harvard Professor Attacking Google Thrives as Web Sheriff

http://www.bloomberg.com/news/2014-02-14/harvard-professor-attacking-google-thrives-as-web-sheriff.html?utm_campaign=xlike1&utm_country=es&utm_timestamp=20140214101727EST

“He’s the Doogie Howser of online investigative work,” Microsoft’s Richard Boscovich, a former federalprosecutor, is assistant general counsel at the software company’s digital-crimes unit.

“He’s part academic and part cyber sleuth,” Ken Dreifach, former chief of the Internet bureau of theNew York Attorney General’s Office.

In 2006, after Edelman wrote about Zango, the company agreed to pay $3 million to settle a FederalTrade Commission complaint that it used unfair and deceptive methods to put advertising software onconsumers’ computers. Blinkx is using Zango’s software, Edelman said in his blog post.

Other work exposing Infospace’s schemes (by Professor Ben Edelman):

Google Click Fraud Inflates Conversion Rates and Tricks Advertisers into Overpaying – January 12, 2010

Source: http://www.benedelman.org/news/011210-1.html#infospace

How Yahoo Funds Spyware

Source: http://www.benedelman.org/news/083105-1.html

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End Notes

Introduction

1. Dot-con job: How InfoSpace took its investors for a ride, Seattle Timeshttp://seattletimes.com/html/businesstechnology/2002198103_dotcon1main06.html

2. Spitzer: Merrill analyst pitched stock he called 'junk' , USA Today,http://usatoday30.usatoday.com/money/finance/2002-04-15-spitzer-email-evidence.htm

3. Google on Cloaking, https://support.google.com/webmasters/answer/66355?hl=en4. Google Click Fraud Inflates Conversion Rates and Tricks Advertisers into Overpaying

http://www.benedelman.org/news/011210-1.html5. BCOR 10Q for Q2 2010


1. BCOR Monoprice Transaction Presentation2. BCOR 10K and 10Q filings.3. Alexa.com (some of the rankings change daily, but are approximately correct)4. Visit Metacrawler.com, and https://adblockplus.org/forum/viewtopic.php?t=202865. Alexa.com (some of the rankings change daily, but are approximately correct)6. Babylon Has Record Plunge as Google Deal Ends: Tel Aviv Mover,

http://www.bloomberg.com/news/2013-10-30/babylon-has-record-plunge-as-google-deal-ends-tel-aviv-mover.html

7. BCOR 10K and 10Q filings.8. THE FOURTH QUADRANT: A MAP OF THE LIMITS OF STATISTICS By Nassim Nicholas Taleb

[9.14.08], http://edge.org/conversation/the-fourth-quadrant-a-map-of-the-limits-of-statistics9. Enigma Software Group, http://www.enigmasoftware.com/infospacecom-removal/10. Alexa.com (some of the rankings change daily, but are approximately correct)11. “”12. How To Remove Fantastigames.Webcrawler.Com, http://spywareremovers.com/how-to-

remove-fantastigames-webcrawler-com13. Remove Dogpile.com redirect (Virus Removal Guide) http://malwaretips.com/blogs/remove-

dogpile-virus/14. Alexa.com (some of the rankings change daily, but are approximately correct)15. How To Remove MetaCrawler Toolbar Malware And Infospace.com Viruses (Metacrawler.com

Hijacker Virus, http://botcrawl.com/how-to-remove-metacrawler-toolbar-malware-and-infospace-viruses/

16. Alexa.com (some of the rankings change daily, but are approximately correct)17. Visit Metacrawler.com, and https://adblockplus.org/forum/viewtopic.php?t=2028618. Alexa.com (some of the rankings change daily, but are approximately correct)19. “”

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20. Discerning click fraud, http://www.legalzoom.com/business-management/running-your-business/discerning-click-fraud

21. Alexa.com (some of the rankings change daily, but are approximately correct)22. “”23. “”24. BCOR 10K 201225. Discerning click fraud, http://www.legalzoom.com/business-management/running-your-

business/discerning-click-fraud26. Alexa.com (some of the rankings change daily, but are approximately correct)27. “”28. Google Click Fraud Inflates Conversion Rates and Tricks Advertisers into Overpaying

http://www.benedelman.org/news/011210-1.html29. http://www.bloomberg.com/apps/news?pid=conewsstory&tkr=IFP2:GR&sid=aEpAST80cOIA

http://press-release.medianama.com/aditi-technologies-to-acquire-infospace-india-development-center-223

30. Aditi.com, Google Maps31. BCOR 2Q 2010 10Q32. Google Click Fraud Inflates Conversion Rates and Tricks Advertisers into Overpaying

http://www.benedelman.org/news/011210-1.html33. http://www.bloomberg.com/apps/news?pid=conewsstory&tkr=IFP2:GR&sid=aEpAST80cOIA

http://press-release.medianama.com/aditi-technologies-to-acquire-infospace-india-development-center-223

34. BCOR 2Q 2010 10Q35. BCOR press release36. BCOR press release37. BCOR 10K and 10Q filings38. InfoSpace Changes Corporate Name to Blucora, Inc.,

http://investor.blucora.com/releasedetail.cfm?ReleaseID=68113039. BCOR 10K and 10Q filings40. Google Maps41. Pradeep Rathinam, Linkedin.com https://www.linkedin.com/pub/pradeep-rathinam/0/7b1/88742. Infospace India, Linkedin.com, https://www.linkedin.com/company/infospace-technologies-

india-pvt-ltd43. BCOR 10Q Q3 2012, alexa.com for traffic graphs44. BCOR 10Q filings compared against BCOR 10K 2012 statement cited.45. Zero tolerance child porn policy http://googleblog.blogspot.com/2006/06/protecting-children-

online.html46. Source: http://www.keywordspy.com/47. Google.com48. Google.com , and BCOR 10K 200649. Alexa.com (some of the rankings change daily, but are approximately correct)50. Dogpile.com, webcrawler.com, and google.com

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Blucora’s History of Bad Behavior: The Iminent.com Problem

1. Google and Yahoo! banish WhenU.com for distorting search rankings, http://www.out-law.com/page-4541

2. “”3. Google Still Charging Advertisers for Conversion-Inflation Traffic from WhenU Spyware

http://www.benedelman.org/news/010510-1.html4. BCOR 2010 Q2 10Q5. Google Click Fraud Inflates Conversion Rates and Tricks Advertisers into Overpaying,

http://www.benedelman.org/news/011210-1.html6. Buckley Blucora Presentation, http://www.businessinsider.com/zack-buckley-blucora-

presentation-2013-5?op=17. Google.com8. New fraud found, software bundle that is distributed on a torrent sites http://secure-the-

internet.org/?p=1009. Google.com10. New fraud found, software bundle that is distributed on a torrent sites http://secure-the-

internet.org/?p=10011. Google on Cloaking, https://support.google.com/webmasters/answer/66355?hl=en

Google is Better off without Infospace/Blucora

1. Babylon Has Record Plunge as Google Deal Ends: Tel Aviv Moverhttp://www.bloomberg.com/news/2013-10-30/babylon-has-record-plunge-as-google-deal-ends-tel-aviv-mover.html

2. Google and Microsoft agree steps to block abuse images http://www.bbc.co.uk/news/uk-24980765

3. Zero Tolerance Policy http://googleblog.blogspot.com/2006/06/protecting-children-online.html4. Webcrawler.com5. Amended Agreement, GOOG BCOR,

http://www.sec.gov/Archives/edgar/data/1068875/000119312511129038/dex101.htm6. BCOR 10K 20127. Buckley Blucora Presentation, http://www.businessinsider.com/zack-buckley-blucora-

presentation-2013-5?op=18. Google Still Charging Advertisers for Conversion-Inflation Traffic from WhenU Spyware,

http://www.benedelman.org/news/010510-1.html

Ties that Blind: “You’re only as good as the company you keep

1. Blucora website, management biographies, BCOR SEC filings.2. BCOR 2006 10K3. Google.com

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4. Alexa.com5. BCOR press release, InfoSpace Partners with blinkx to Offer Video Search Functionality on

Award-Winning Dogpile.com6. “Google Click Fraud Inflates Conversion Rates and Tricks Advertisers into Overpaying , Ben

Edelman7. With a Lifeline to London, Blinkx Builds the World’s Largest Video Search Index,

http://www.xconomy.com/san-francisco/2010/11/30/with-a-lifeline-to-london-blinkx-builds-the-worlds-largest-video-search-index/

8. The Darker Side of Blinkx, Ben Edelman9. Alexa.com10. Pavel Lyadnov https://www.linkedin.com/pub/pavel-lyadnov/23/160/70a11. Google maps12. https://www.linkedin.com/in/shakedtal13. Naveen Jain's Latest Scam: Intelius, http://techcrunch.com/2008/05/29/naveen-jains-intelius-

prepares-to-go-public-how-much-of-their-revenue-is-a-scam/14. Intelius S-1 Filing15. Meet Inome: The latest thing to sprout from Naveen Jain

http://www.geekwire.com/2012/inome-naveen-jains-latest-entrepreneurial-pursuit/16. http://www.iminent.com/Help/faq

Non-GAAP is Back

1. InfoSpace bubble-era accounting highly "complicated",http://usatoday30.usatoday.com/tech/techinvestor/industry/2005-03-10-infospace_x.htm?csp=34

2. Dot-con job: How InfoSpace took its investors for a ride, Seattle Timeshttp://seattletimes.com/html/businesstechnology/2002198103_dotcon1main06.html

3. BCOR 10K filings4. BCOR 10K and 10Q filings.5. Dot-con job: How InfoSpace took its investors for a ride, Seattle Times

http://seattletimes.com/html/businesstechnology/2002198103_dotcon1main06.html6. BCOR 10K filings.7. EdgarPro8. BCOR proxy filings.9. BCOR 10K filings10. “”

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BCOR Shares Are Worth No more Than $5.00 per Share

1. THE FOURTH QUADRANT: A MAP OF THE LIMITS OF STATISTICS By Nassim Nicholas Taleb[9.14.08], http://edge.org/conversation/the-fourth-quadrant-a-map-of-the-limits-of-statistics

2. Yahoo! Finance3. Babylon Has Record Plunge as Google Deal Ends: Tel Aviv Mover,

http://www.bloomberg.com/news/2013-10-30/babylon-has-record-plunge-as-google-deal-ends-tel-aviv-mover.html

4. BCOR 10K and 10Q filings5. “”6. “”7. “”

Documents

Blucora (i.e. Infospace): Worse Than Blinkx plc & Babylon Ltd