Key questions and answers from the first quarter fiscal 2008 earnings call conducted by Marchex on May 6, 2008.

Christa Quarles (Thomas Weisel Partners): You indicate that the $85 million unique look-ups were due to yellow.com. Could you dissect the performance in that area further? Was there a particular category within the local side that showed particular strength or particular partners that helped there?

Russell C. Horowitz: As it relates to the look ups, those are revenue-generating events. When you look at what’s driving it, we notice specifically, they’re business look-ups, which is what our OpenList content engine supports and what yellow.com supports. It’s helping consumers find their way to find the businesses they need. We’re therefore continuing to do a good job of that and we’re continuing to do a better job of fulfilling, which comes down to matching increased demand from local advertisers and aggregators with the growth in our traffic. Those are therefore key themes.

Christa Quarles (Thomas Weisel Partners): You had indicated that economic arrangements from third parties improved in the quarter, but yet you’re also trying to reduce your reliance there. Were they a decent year-over-year benefit?

Russell C. Horowitz: It wasn’t a factor. If you look at Yahoo in Q4 of 2006 we disclosed them as 38% of our revenue. In Q4 of 2007 it was 21%. Clearly, one of the strategic focuses of the company has been to take ownership of monetizing our traffic. The focus is to work with partners where it makes sense and they’re an important partner. What’s therefore driving our growth and opportunity is us taking more control of both sides of the whole local eco-system.

James Leahy (Morgan Joseph & Co., Inc.): Could you give more detail on who or what verticals are the ones that are lowering their advertising budgets at this point?

Russell C. Horowitz: In terms of verticals, we’re in an environment where some are stronger and some are weaker. We noted that retail categories are seasonally weaker than usual. That’s not a big focus for us because our growth is being driven by local. However, they are players in our marketplace. There are other categories like finance that have been noted as weaker. But in the context of what’s driving Marchex, these aren’t defining and so they’re not worth highlighting.

James Leahy (Morgan Joseph & Co., Inc.): What’s left on your current buy-back authorization?

Michael Arends: There are about two million shares still available under our stock repurchase program as of March 31.

James Leahy (Morgan Joseph & Co., Inc.): Is your guidance implying that the back half or the fourth quarter is where the strength is going to be in 2008 versus in the third quarter?

Michael Arends: We do expect to see throughout the last half of the year, which includes the third quarter, an increase in revenue growth as well as operating leverage.

Matt Hewitt: Looking at the Voice Star, you’re still early in the investment phase. When do you expect to start to see revenue contribution there?

Russell C. Horowitz: One of the key elements we find with our partnerships is people want integrated solutions and in many cases involving click- and call-based elements. Having the Voice Star product in the suite of products and services means we can offer to aggregators and it’s more than one plus one equals two. Voice Star, with the ability to support call-based products, is having a greater than one-for-one impact on our overall business given that we are a highly credible company with significant resources that can provide a unique set of services to both horizontally and vertically focused local aggregators. It’s therefore contributing right now and it’s going to be a key driver of what we’re looking for in terms of growth. Clicks and calls are increasingly sold as a package deal. That’s going to be one of the trends you see unfold over the next 12 to 24 months.

Sameet Sinha (JMP Securities): Can you elaborate on your content strategy?

Russell C. Horowitz: As it relates to our content initiatives, we focus on two themes; local search in our consumer-facing initiative and local advertising in our merchant-based facing initiative. With merchants and our aggregated partners it’s all about transparency. We want to deliver all the products they need and that gives them the transparency to understand what they’re getting for what they spend. On the consumer side, there’s no shortage of information. It’s about organizing it in a manner and delivering it to consumers where you reduce the noise for them. Our initiative is looking at this next generational local search platform and syndication engine is organizing this information in a manner that reduces the noise for consumers in finding the business information they need.

Sameet Sinha (JMP Securities): Can you talk about the dynamics in the local S&B market, specifically contract relations, cancellation terms, notice fee, etc? How are these sold?

Russell C. Horowitz: We’ve got partners who sell these products in a variety of different ways. One of the things we like about the small- and medium-sized business market is a lot of these packages are sold over 12+ month packages and it can build a nice recurring visible revenue stream. We therefore think that’s a big opportunity. But they’re sold under a variety of different package formats and we have the flexibility to support any of them.

Melinda Diaz: On brands consolidation initiative, could you explain what’s involved in phase one and how you expect it to progress?

Russell C. Horowitz: We have enhanced as a Pay-Per-Click service, we’ve got industry brands as a contextual provider. Those are key parts of phase one. Then on the integrated product side, they can support advertisers with PPC contextual as well as network and site-specific buys.