This document contains forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934, including statements regarding the pending acquisition of a controlling
interest in Expedia, Inc. ("Expedia") by USA Networks, Inc. ("USA").
Forward-looking statements may be identified by, among other things, the words
"intends", "sets", and "will" and the assumption that the transaction with USA
will be completed in accordance with its terms. These statements are based on
management's current expectations and are subject to uncertainty and changes in
circumstances. For example, the transaction is subject to customary closing
conditions and there is a possibility the transaction may not be completed if
any of these closing conditions are not satisfied. We have based all of our
forward-looking statements on information available to us as of January 11,
2002, and we are not obligated to update any of these forward-looking
statements.

USA and Expedia filed a joint prospectus/proxy and information statement and
other relevant documents concerning USA's acquisition of Expedia with the
Securities and Exchange Commission ("SEC") on November 9, 2001. INVESTORS ARE
URGED TO READ THE JOINT PROSPECTUS/PROXY AND INFORMATION STATEMENT AND ANY OTHER
RELEVANT DOCUMENTS FILED OR TO BE FILED IN THE FUTURE WITH THE SEC BECAUSE THOSE
DOCUMENTS CONTAIN IMPORTANT INFORMATION. Investors will be able to obtain such
documents free of charge at the SEC's website at www.sec.gov. In addition, such
documents may also be obtained free of charge by contacting USA Networks, Inc.,
152 West 57th Street, New York, New York, 10019, Attention: Investor Relations,
or Expedia, Inc., 13810 SE Eastgate Way, Suite 400, Bellevue, WA 98005,
Attention: Investor Relations. INVESTORS SHOULD READ THE JOINT PROSPECTUS/PROXY
AND INFORMATION STATEMENT CAREFULLY BEFORE MAKING ANY RELATED VOTING OR
INVESTMENT DECISIONS.

USA and its directors and officers may be deemed to be participants in the
offering of securities by USA, and Expedia and its directors and officers may be
deemed to be participants in the offering of securities by Expedia as well as in
solicitation of proxies from Expedia shareholders to adopt the agreement
providing for USA's acquisition of a controlling interest in Expedia. A detailed
list of the names and interests of USA's directors and executive officers is
contained in the definitive proxy and information statement on Schedule 14A
filed by USA with the SEC on April 9, 2001, and a detailed list of the names and
interests of Expedia's directors and officers is contained in the definitive
proxy and information statement on Schedule 14A filed by Expedia with the SEC on
October 11, 2000. Copies of those filings may be obtained free of charge at the
SEC's website at www.sec.gov.



                                               Filed by Expedia, Inc.
                                               Pursuant to Rule 165 and Rule 425
                                               under the Securities Act of 1933
                                               Subject Company: Expedia, Inc.
                                               Commission File No. 000-27429


January 12, 2001

Dear shareholder/media representative/analyst:

Today, Expedia, Inc. mailed to shareholders a supplement to its earlier proxy
statement regarding the USA Networks transaction, in which USA Networks intends
to acquire up to 37.5 million, or 75%, of Expedia's outstanding shares. The
supplement sets February 4, 2002, as the date for the readjournment of the
Expedia's annual shareholders' meeting to consider the transaction. This date is
also the deadline for Expedia shareholders to elect to retain their Expedia
shares and receive warrants to purchase additional Expedia shares, or to
exchange their Expedia shares for a package of USA Networks securities.

The supplement explains that the Expedia annual shareholders' meeting was
adjourned in order to give Expedia shareholders time to consider their
alternatives in light of the announcement that USA Networks has entered into an
agreement to sell certain of its assets to Vivendi Universal. As the supplement
explains, there have been no changes in the terms of the Expedia/USA transaction
as described in Expedia's proxy dated November 13, 2001.

This supplement will be available on Edgar and on Expedia's investor relations
website. The investor website can be located using the "About Expedia" link on
the company's website, www.expedia.com, or by going directly to
http://investor.expedia.com.

Please feel free to call me for more information.

Regards,

Marj Charlier