Back to Main

Yahoo

July 7, 2008

Micro-hoo Head Games: Next 24 Days are All-Important

The two most important dates in Yahoo's immediate future are July 22 and August 1.

On the first date Yahoo will announce its second quarter earnings, which should help clarify its (and the Web's) vulnerability to U.S. economic woes -- as well as to continued oversupply caused by a glut of social network ad inventory. Any pain would likely emanate from the financial, automotive & travel sectors, which have steadily reduced spending over the past year.

Poor results will put the company on weak footing with investors, who will meet on the second date above to decide on -- among other things -- Carl Icahn's proposal to oust its management and board of directors. Icahn intends to replace the company's CEO and board with a leadership team, including himself, that would be more open to a sale of part or all of Yahoo to Microsoft. Indeed, should Icahn succeed, whatever crew takes over would be explicitly appointed to orchestrate a deal with Microsoft.

No shocker: Microsoft supports that outcome. Microsoft stated this morning that it has "concluded it cannot" reach an agreement with the current leadership (very careful language that does not preclude new talks with Yang at some later date), but would reconsider a complete acquisition of Yahoo if Yang & company are yanked. Yahoo quickly retorted: "If Microsoft and Mr. Ballmer really want to purchase Yahoo, we again invite them to make a proposal immediately."

Meanwhile, Yahoo may be working furiously to consummate an agreement with Time Warner to purchase or otherwise combine its operations with those of AOL. The Times Online describes re-ignited talks between the Web company, Goldman Sachs and Time Warner's leadership in an effort to "re-heat" negotiations ahead of that all-important shareholder meeting.

A merger announcement within 24 days could overshadow weak earnings, and convince shareholders to give Yahoo's current leadership some more time to improve performance.

Posted by Zachary Rodgers at 12:21 PM | Permalink | Comments (0) | TrackBack

July 2, 2008

Quote of the Day: Filling Ballmer's "Internet hole"

"Yahoo executives were unimpressed with Mr. Ballmer's vision. If anything, they regarded the Yahoo pursuit as a crude solution to quell his obsession with Google. They would later refer to Mr. Ballmer's plan as 'filling his Internet hole.'"

-From The Journal's detailed report on the ins and outs of Microsoft's negotiations with Yahoo. Most recently, Microsoft has approached media giants including News Corp and Time Warner to join it in a new offer that would likely result in the breakup of Yahoo. The story suggests those discussions have so far come to naught.

Posted by Zachary Rodgers at 11:06 AM | Permalink | Comments (0) | TrackBack

June 20, 2008

Yahoo Reorg Coming as More Execs Fly Coop

It's been fully 10 months since the last reorg from Yahoo, a company that shakes up its executive ranks almost as often as chronic reshuffler Microsoft. Even setting aside its habitual restructuring, that's an eternity in Yahoo-time. Way back in August 2007 -- when it named Hilary Schneider to lead the new Global Partner Solutions unit -- the company was still basking in praise for Panama, new CEO Jerry Yang had yet to complete his 100-day evaluation, and the thought an imminent deal with either Microsoft or Google would have seemed outlandish to say the least.

Given all that's come to pass, it's probably appropriate that top brass has now decided to reassess Yahoo's reporting structure.

Yahoo is so far mum on the details of its impending realignment, reported today in The Journal. However it seems the new regime won't have a profound impact on the company's ad products or advertiser relationships. Rather it will consolidate numerous products, such as mail, search and homepage operations, into a global unit. President Sue Decker is apparently driving the changes in the interest of facilitating better communication between domestic and overseas product groups.

Decker reportedly stepped up the pace of planning for the new division after the departure last week of Network Division EVP Jeff Weiner. She'd better hurry, since the general impression right now is that executive staffers are storming the exits. At least eight mid- to senior-level execs either have left or are expected to leave in short order. They include Dr. Usama Fayyad, the company's EVP of research and strategic data solutions; Jeremy Zawodny, a long-time technology lead who bolted to join Craigslist as chief technology officer; Communities and Front Doors SVP Brad Garlinghouse (of peanut butter manifesto fame); Qi Lu, EVP of engineering for the search and advertising technology group; search group SVP Vish Makhijani; and Flickr founders Caterina Fake and Stewart Butterfield.

Posted by Zachary Rodgers at 11:45 AM | Permalink | Comments (0) | TrackBack

June 19, 2008

So Long, Yahoo: Garlinghouse, Qi Lu, Flickr Founders Exit

Yahoo's starting to resemble an anthill that's been bombed with firecrackers. The latest to walk, according to reports: Communities and Front Doors SVP Brad Garlinghouse (left, of peanut butter manifesto fame), plus Qi Lu, EVP of engineering for the search and advertising technology group, and search search group SVP Vish Makhijani, who's reportedly headed to Russian search firm Yandex Silicon Valley research facility Yandex Labs.

Additionally, Flickr founders Caterina Fake and Stewart Butterfield are leaving the company. Fake's last day was Friday the 13th, while Butterfield will leave July 12, according to reports.

The departures come just a week after two other senior execs made their exits: Jeff Weiner, EVP Network Division, left to become executive-in-residence with venture capital firms Accel Parnters and Greylock Partners. Dr. Usama Fayyad, EVP of research and strategic data solutions, is also heading for the hills.

Amid the latest brain drain, Yahoo is rumored to have put a chill on new hires. However in recent comments to investors North American Sales VP David Karnstedt said the company continues to hire aggressively.

Posted by Zachary Rodgers at 3:20 PM | Permalink | Comments (0) | TrackBack

June 18, 2008

Yahoo Sales "Hiring Aggressively" Amidst Freeze Rumors

As rumors of a Yahoo hiring freeze soar , the company's SVP North American Sales David Karnstedt told the crowd at today's William Blair and Company's annual growth stock conference Yahoo "continue[s] to hire aggressively." At least, that's the case for the sales department, as indicated by Karnstedt during a Q&A at the Chicago get together.

The notion of hiring aggressively doesn't exactly jibe with the gossip that Yahoo is in the midst of a hiring freeze, or at least a very restrictive hiring environment.

"Attrition has been very low on the [sales] team," he said, adding, "Retaining people and bringing new people in has been the call of the day."

Asked whether the recent Microsoft hullabaloo or general negative talk about the company's status has affected the ability to hire salespeople, Karnstedt said, "It has not had any impact." In fact, he added, Yahoo exceeded its expectations when it comes to filling sales positions in the first half of '08.

Still, Yahoo seems to be falling prey to yet another exodus of top execs.

If indeed Yahoo is hiring salespeople "aggressively," even as other departments feel the pinch of a tighter budgetary belt, there's at least one explanation: You can't bring in big ad dollars from brands and agencies without salespeople.

Posted by Kate Kaye at 10:33 AM | Permalink | Comments (0) | TrackBack

June 17, 2008

SignOn San Diego Could Join Yahoo

I had a great chat with Mark Davis, VP Strategy at San Diego Union Tribune this afternoon. Following some significant interactive exec departures, Davis is heading up strategy for the publisher's interactive operations (in addition to strategy for the overall business). He's got a lot of decision making ahead of him, but one of those decisions may involve Yahoo's newspaper consortium.

"We're also looking at the Yahoo consortium," Davis told me, stressing no deal has been signed. He wasn't involved when Yahoo originally made its offer a couple years ago, so he couldn't (or wouldn't) say exactly what's prevented the Union Tribune from joining the growing alliance in the past.

"I think that it's just one of those things where in the initial negotiations with that...didn't look right for us. It just sort of fell off the radar screen." Now, he continued, "We took another look at it and said this may work for us."

As newspapers struggle with plummeting print ad sales and slowing online ad growth, they need more online advertisers, pronto. Part of the attraction of partnering with Yahoo, Davis said, is the ability to increase local reach for advertisers through Yahoo inventory.

Posted by Kate Kaye at 1:33 PM | Permalink | Comments (0) | TrackBack

June 16, 2008

Yahoo-Google Confounds Digerati, Marketers Universally Miserable

One hundred hours later, opinion makers still can't agree on whether Yahoo's search ads deal with Google was a brilliant move long overdue or the beginning of the end.

For those in the latter camp, perhaps the most stinging indictment came from Joe Nocera, who wrote in the Times that Yahoo has "chosen to become a pawn of the most dominant company on the Internet." That's a strong remark, given the deal allows Yang & Co. to retain a control lever they can use to ratchet up monetization when flagging earnings seem to call for it.

The more they use that lever, the less pleased marketers will be. Many fear price hikes as Google boosts its control of search ad spending to 90 percent or more. Increases are probably not around the corner however, except insofar as advertisers give up on Panama and spend more on Google, thus bidding keywords higher. Under that scenario, Google will encounter less pressure to create competitive value for advertisers. That could manifest in higher campaign costs down the road.

As distasteful as Google's embrace is to Yahoo, it's nothing compared to what Microsoft's feeling -- especially given it lit the fuse on the bomb that just blew up in its face.

Indeed, if the six-month drama surrounding Yahoo's fate were a drawn-out Looney Tunes episode, the screen would now display a blackened Wile E. Coyote (Microsoft, a.k.a. Eatibus Anythingus) moments after an elaborately concealed explosive device detonates on top of him. The singed coyote can only look on in despair as Road Runner (Google, a.k.a. Hot-rodicus Supersonicus) casually polishes off the platter of bird seed laid as bait. The comparison breaks down a bit at this point, since Yahoo clearly has to be both the pile of Acme brand TNT and the bird seed.

Whatever. The big question now is, what's Wiley planning next? It was only a year ago that its loss of DoubleClick in a fierce bidding war with Google drove Microsoft to hotly pursue a purchase of much larger aQuantive. There is no acquisition target bigger than Yahoo, but many smaller snacks remain on the table -- for instance AOL, Facebook, ValueClick, AdBrite, Tribal Fusion, and Specific Media.

Finally, many believe an eventual acquisition of Yahoo is still very much in the company's plans, and that Yahoo's Google deal has merely bought it time. It's entirely possible regulators will block the relationship on anti-competitive grounds, in which case pressure will mount for Yahoo to return to the negotiating table.

Posted by Zachary Rodgers at 2:09 PM | Permalink | Comments (1) | TrackBack

June 3, 2008

WSJ: Icahn Seeks Yang's Ouster

In the latest volley, Yahoo investor Carl Icahn is calling for the ouster of Yahoo's chief executive Jerry Yang, according to wsj.com.

Icahn has previously called for the replacement of Yahoo's board, which includes Yang.

The latest report comes a day after a Delaware judge unsealed a class action lawsuit against Yahoo's board and Yang. The suit alleges Yahoo's board set up "roadblocks" to Microsoft's proposed acquisition of Yahoo, especially an expensive employee severance package.

A copy of the unsealed lawsuit can be found at the Web site of Bernstein Litowitz Berger & Grossmann, the firm suing Yahoo on behalf of on behalf of Detroit's Police and Fire Retirement System, Detroit's General Retirement System, and other Yahoo shareholders. "Yang convinced the [Yahoo] board to adopt change-in-control employee severance plans that impose tremendous cost and risks for an acquirer, throwing sand in the gears of Microsoft's plans for a smooth integration," the lawsuit alleges.

Posted by Anna Maria Virzi at 4:18 PM | Permalink | Comments (0) | TrackBack

May 30, 2008

'Sex and the City' and Search

The opening today of "Sex and the City," the movie, got search engine marketers into action, using paid search on Google and Yahoo to promote everything from bling (GiltyCouture and Ziamond), to ringtones, to an online video site (MyHubTV).

What, no Manolo Blahniks?

Yahoo paid search results, below.

Posted by Anna Maria Virzi at 8:53 AM | Permalink | Comments (0) | TrackBack

May 18, 2008

Microsoft-Yahoo: A New Spin

Two weeks after withdrawing its bid for Yahoo, Microsoft has returned with another proposal: acquire only a portion of Yahoo.

Microsoft, in a statement, said it continues to "explore and pursue its alternatives to improve and expand its online services and advertising business."

The Wall Street Journal, quoting unnamed sources, reports Microsoft's proposal would involve Yahoo display ads sold by Microsoft next to Yahoo research results. That proposal appears to be in response to Yahoo's decision to test Google ads on its own search results pages.

Yahoo, in a carefully worded news release titled, "Yahoo! Remains Open to Value Maximizing Transactions," said it "confirmed with Microsoft that it is not interested in pursuing an acquisition of all of Yahoo at this time." (Note the use of the word, "all" here.)

Yahoo said it intends to evaluate alternatives, including any proposal from Microsoft, that would be in the best interest of stockholders.

This latest development comes days after Yahoo investor Carl Icahn made noise to launch a battle and replace Yahoo board members with an alternate board unless talks are renewed with Microsoft.

Posted by Anna Maria Virzi at 8:49 PM | Permalink | Comments (0) | TrackBack

May 15, 2008

Yahoo Taking It From All Sides

Yahoo's having a rough go of it today, with the official emergence of a threat to its board led by investor Carl Icahn, and the usurpation (according to comScore) of its U.S. Web traffic leadership by Google.

In a letter to Yahoo chairman Roy Bostock, Icahn alleged the board "acted irrationally and lost the faith of shareholders and Microsoft," and proposed an alternate board that includes Marc Cuban, Adam Dell and himself. "It is unconscionable that you have not allowed your shareholders to choose to accept an offer that represented a 72 percent premium over Yahoo’s closing price of $19.18 on the day before the initial Microsoft offer." Wall Street Journal has more coverage. TechCrunch has the letter to Bostock.

The goal of a proxy fight would be to consummate a deal with Microsoft, but for that to happen Microsoft would have to go along. That it will is far from certain. Some of the post-collapse speculation and rumor has held that Ballmer & his cohorts had become unsure about the deal were secretly relieved to see it die. However many in the investment community continue to maintain a deal is still possible, if only because Icahn would not have undertaken this move without some indication Microsoft would still be receptive.

Update: Yahoo fired back late yesterday, accusing Icahn of misunderstanding the facts about Microsoft's proposal and how it imploded. Its letter restated Yahoo's position that its board was always open to negotiating a deal and that Microsoft has stated clearly it's "moving on."

Meanwhile the traffic report from comScore is largely symbolic but still painful to Yahoo, which for years has enjoyed the right to call itself the leader of the pack in terms of U.S. reach. According to the measurement firm, both companies possessed about 141 million visitors on their owned and operated sites during the month of April. However it claims Google has an edge, for the first time, of about 466,000 users. Of course comScore's numbers are notoriously shaky and for that reason the finding means very little. For all purposes the companies are locked in close combat for rights to say they have the biggest audience.

Posted by Zachary Rodgers at 2:21 PM | Permalink | Comments (1) | TrackBack

May 13, 2008

Yahoo Political Ad Guy Moves to Westwood One

It's official: Richard Kosinski, former VP of political advertising for Yahoo, is moving to Westwood One. As SVP, Chief Digital Officer, Kosinski will head up Westwood's digital products such as news, sports and talk as well as all digital product and business development. While the Westwood name is synonymous with radio, the company is branching out to all platforms.

As I reported in April, Kosinski is replaced by Yahoo vet Diane Rinaldo, who apparently had done some work with political advertisers before taking the new role.

A source of mine -- a big name in the online political ad space who is responsible for planning online media buys for advocacy groups and candidate campaigns -- told me after Kosinski's departure was made public, "I miss him already."

Posted by Kate Kaye at 2:51 PM | Permalink | Comments (0) | TrackBack

May 5, 2008

Is the Stage Set for an AOL Sale?

With the dust settling around Microsoft's abortive bid for Yahoo, one thing's quickly becoming clear: The self-destruction of this particular takeover attempt is not the end of Yahoo's odyssey but merely a mid-way point. Analyst and blogger speculation this morning has anticipated a variety of outcomes for Yahoo, including a deal with News Corp (though talks have reportedly "cooled"), an acquisition of ValueClick, and even a late third act consummation with Microsoft.

The next big Web company to sell may not be Yahoo, however. Last month we learned Yahoo was closing in on a deal to imbibe AOL. Presumably those talks are still underway, and word this morning is Microsoft has already entered the fray. Google may also be interested in AOL, which would give it the reach in display that has so far eluded it.

Microsoft seems the best bet to triumph in any competitive bidding process, given it's already flashed its money roll to investors and the business community. Plus it really does crave search market share. And while AOL's 5 percent wedge of the U.S. search pie is modest by comparison to Yahoo's 21 percent, Microsoft could nearly match Yahoo by buying both AOL and Ask. Sweetening the deal for Microsoft, buying those two entities would would end Google's ad distribution deals with them, cutting into its profits.

Additionally, any company to combine with AOL will command the display ad market. A combined AOL-Yahoo would be a true powerhouse, as the companies are #1 and #2 in display. A combined Google-AOL would create huge inroads into display for a company that's so far still just barely out of lip-service territory in the category.

Posted by Zachary Rodgers at 2:25 PM | Permalink | Comments (0) | TrackBack

May 3, 2008

Microsoft Withdraws Bid for Yahoo

Microsoft on Saturday withdrew its bid to acquire Yahoo, opting against raising its offer $5 billion more or pursuing a hostile takeover.

Microsoft CEO Steven Ballmer, in a letter to Yahoo CEO Jerry Yang, said he was concerned that Yahoo would take actions that would make the company undesirable to Microsoft. Of particular concern: Yahoo's decision to test Google's search ads on its own results pages, and the possibility that Yahoo would work more closely with Google on paid search going forward.

Such an arrangement, Ballmer wrote, "would fundamentally undermine Yahoo!’s own strategy and long-term viability by encouraging advertisers to use Google as opposed to your Panama paid search system."

He continued: "This would also effectively enable Google to set the prices for key search terms on both their and your search platforms and, in the process, raise prices charged to advertisers on Yahoo," Ballmer said.

Yahoo Chairman Roy Bostock fired back a statement, reiterating that Microsoft's bid undervalued Yahoo. "We remain focused on maximizing shareholder value and pursuing strategic opportunities that position Yahoo! for success and leadership in its markets," Bostock said in a news release.

On Feb. 1, Microsoft offered to pay $44.6 billion or $31 a share for Yahoo. Since then, Microsoft said it agreed to raise its bid by $2 per share, but Yahoo wanted another $4.

Posted by Anna Maria Virzi at 9:39 PM | Permalink | Comments (0) | TrackBack

May 2, 2008

More Micro-heuvering: WSJ Contracts Nasty Case of "Coulds"

Microsoft and Yahoo continue to negotiate heavily through the medium of the Wall Street Journal, forcing reporters Kevin Delaney, Matthew Karnitschnig, and Robert Guth into spastic repetition of the word "could."

Microsoft could announce it's backing out of the deal, we heard yesterday. The word this morning is it's leaning toward going hostile as early as today, but "could change tack." Meanwhile, Yahoo could announce an expansion of its Google search ad trial by next week. Such a deal "could go forward" even in the event of a hostile bid, WSJ promises.

What about Yahoo/AOL? Could happen. After all, it's been just three weeks since the firms were "closing in on a deal" to combine operations.

One thing's clear: All us losers that aren't the Wall Street Journal could have some real Microsoft/Yahoo news to report as early as any minute.

Posted by Zachary Rodgers at 12:53 PM | Permalink | Comments (0) | TrackBack

April 25, 2008

Rinaldo to Replace Kosinski in Yahoo Political Sales Team

Richard Kosinski has been the guy selling Yahoo ads to political advertisers for awhile now. But no longer. According to a tip-off from Eric Frenchman, who handles a lot of online search and display buying for John McCain's campaign, Kosinski will take a senior position at WestwoodOne.

I checked in this morning with Kosinski, then heard back from Yahoo PR that, indeed, he'll be replaced by Diane Rinaldo, "a four year Y! veteran." She'll "assume the leadership of the political ad sales team," the e-mailed statement said. Evidently she's been working with the presidential candidate campaigns and party committees since joining the political sales team last year.

When I first met Kosinski in January 2007, we were perched high atop Manhattan for a sunlit lunchtime presentation about Yahoo's Personal Finance section redesign. At the time, he was Yahoo's business and finance category development officer. I have to say I was kind of surprised when I saw him on an online ad industry event panel representing Yahoo's political advertising.

Not that he isn't perfectly capable of selling Yahoo to political advertisers, it's just that it caught me off guard. As a good source in the online political ad world has suggested to me (not necessarily regarding Kosinski), media firms often pluck an ad salesperson from a standard vertical focus to handle political advertising when presidential primaries kick into gear.

It's worth noting, at least according to Nielsen Online data, Yahoo ran the most display ad impressions by presidential candidates in 2007, compared to any other individual Web site. Though networks like Google and Advertising.com also definitely raked in some dough from the three big online ad spenders -- Barack Obama, John McCain and Mitt Romney (remember him?) – Yahoo appears to have done well thus far.

According to my calculations based on Nielsen Online data, nearly 90 million ad impressions from the candidates, or 32 percent, ran across Yahoo -- from its Movies and Sports sections to its highly-trafficked e-mail pages. MSN grabbed about 30 million or 11 percent of display ads run by presidential hopefuls, mainly Obama. Excite's e-mail section and homepage garnered over 16 million or 6 percent of impressions, while AOL scored about 4 percent or 11 million. Sites including FoxNews.com, The New York Times, MSNBC, Newsmax and HuffingtonPost.com also got some prez campaign dollars in '07, and continue to.

As for why Kosinski is leaving, I don't know, but no matter what reason he gives, observers are sure to speculate that it has something to do with Yahoo's ongoing upheaval and unsure future.

According to the Yahoo spokesperson who confirmed his departure, "First and foremost, politics and elections will continue to be a focus for the company, especially as the presidential election nears."

Posted by Kate Kaye at 4:44 PM | Permalink | Comments (0) | TrackBack

April 24, 2008

DOJ Notified of Yahoo's Google Ad Test

The U.S. Justice Dept. evidently is looking into or at least has been notified about Yahoo's recent Google ad test. According to a New York Times report, the companies informed the DOJ about the test before it began, but the Dept. won't comment.

Posted by Kate Kaye at 12:48 PM | Permalink | Comments (0) | TrackBack

April 9, 2008

Microsoft/Yahoo Maneuvers: Curiouser and Curiouser

There's seemingly no end to the improbable machinations swirling around Microsoft's unsolicited bid for Yahoo. A flurry of late breaking rumors and announcements today conjured up a series of outlandish scenarios, including the combination of Yahoo and AOL's Internet operations, a possible joint bid for Yahoo by Microsoft and News Corp, and the (confirmed) outsourcing of a portion of Yahoo's search ads to Google.

The very latest developments, reported by WSJ this evening, are that (1) Yahoo and Time Warner's AOL are busy "closing in on a deal" to combine their businesses, yet another desperate maneuver to escape Microsoft's embrace; and (2) Microsoft is in "serious talks" with News Corp. about a plan to combine forces in a bid for Yahoo. No additional details were mentioned about this previously undiscussed scenario.

According to the report, Time Warner would contribute AOL along with a cash investment in exchange for a 20 percent stake in the company. The deal would be contingent on the approval of Yahoo's shareholders.

The latest rumors come at the end of a frenetic day for Yahoo, which this morning announced the planned acquisition of analytics platform IndexTools and this afternoon reluctantly stated it would conduct a test of Google's search ads on its own results pages.

Posted by Zachary Rodgers at 10:05 PM | Permalink | Comments (0) | TrackBack

April 4, 2008

Microsoft Gives Deadline to Yahoo Board

Microsoft CEO Steve Ballmer has given Yahoo's board three weeks to approve Microsoft's $44.6 billion bid for Yahoo. If the board doesn't sign off on the bid, Ballmer said Microsoft will take its case to Yahoo's shareholders.

"The substantial premium reflected in our initial proposal anticipated a friendly transaction with you," Ballmer wrote to Yahoo's board members. "If we are forced to take an offer directly to your shareholders, that action will have an undesirable impact on the value of your company from our perspective which will be reflected in the terms of our proposal."

Yahoo CEO Jerry Yang and chairman Roy Bostock, in a statement today, reiterated that Microsoft's bid undervalues Yahoo. They insisted they aren't opposed to Microsoft taking over Yahoo -- they just want the bid to reflect Yahoo's value.

Since Microsoft made the bid two months ago, Ballmer said the public equity markets and overall economic conditions have weakened. "At the same time, public indicators suggest that Yahoo!’s search and page view shares have declined. Finally, you have adopted new plans at the company that have made any change of control more costly," he wrote.

In response, Yahoo's executives replied that the company has continued to launch new products and to take actions "that leverage our scale, technology, people and platforms as we execute on the strategy we publicly articulated."

The Yang-Bostock letter takes a personal tone. "We regret to say that your letter mischaracterizes the nature of our discussions with you," they wrote. "Moreover, Steve, you personally attended two of these meetings and could have advanced discussions in any way you saw fit."

Plus, Yang and Bostock point out that Microsoft's stock price has declined since its bid, meaning that the value of Microsoft's proposal is lower than it was two months ago.

On Friday, Bloomberg.com reported that Microsoft may cut its $44.6 billion bid for the company, suggesting the economic slowdown could hurt Yahoo's business.

Earlier Friday, Reuters said Microsoft was "evaluating" its bid to purchase the company. Reuters, quoting unnamed sources, pointed out that Yahoo has lost key personnel since Microsoft made its Jan. 31 offer, plus other factors.

Posted by Anna Maria Virzi at 10:31 PM | Permalink | Comments (0) | TrackBack

April 1, 2008

Microsoft Unlikely to Raise Yahoo Bid: WSJ

Having evidently determined it has a better grip on Yahoo's shareholders than Yahoo itself does, Microsoft has decided not to raise its bid for the Internet giant as it had been rumored to do, Wall Street Journal reported this morning. Declines in Microsoft's market value since it made its $45 billion cash and stock offer two months ago have reduced the real value of the bid to around $42 billion. Many expected Microsoft would counter a little higher and seal the deal after Yahoo's rejection of the offer on the grounds it undervalues the company.

Of course, we have to take the Journal's sources on their word that this latest leak isn't planted. "Such pronouncements are standard in deal negotiations but people close to Microsoft insist the stance isn't posturing," the story notes.

Posted by Zachary Rodgers at 11:01 AM | Permalink | Comments (0) | TrackBack

March 28, 2008

Could China Block Microsoft-Yahoo Deal?

Microsoft's proposed purchase of Yahoo could encounter a roadblock in China, "The New York Times" reports today.

An antimonopoly law, which takes effect August 1, strengthens Chinese oversight of acquisitions involving foreign businesses acquiring or investing in Chinese businesses.

Chinese regulators will have the authority to review the Microsoft-Yahoo acquisition's impact on Alibaba.com, an e-commerce company in China. That's because Yahoo invested $1 billion in Alibaba for a 40 percent stake three years ago.

Quoting legal specialists, the Times reports that China's new law could match the powers that regulators in the European Union and the United States now have to review foreign mergers for antitrust concerns.

Posted by Anna Maria Virzi at 11:18 AM | Permalink | Comments (0) | TrackBack

Newspaper CEOs Totally Stoked about Yahoo

If an Editor & Publisher "Special Report" on Yahoo's newspaper consortium project is any indication, everything's going swimmingly with the project, despite worries of how an impending Microsoft takeover could affect the situation. Consortium CEOs got together at a two-day meeting at Yahoo HQ in Sunnyvale in which Yahoo EVP Hilary Schneider and President Sue Decker were in attendance. Apparently the leaders of this motley media crew were throwing around terms like "blown away" and "psyched" afterwards.

Does Yahoo have a rollercoaster in their office courtyard we haven't heard about?

Anyway, though the story acts as a re-cap and somewhat of a cheer-fest for the Yahoo project, there are some tidbits of interest. For one, MediaNews Group CEO Dean Singleton told E&P Yahoo has 572 staffers working on paper consortium efforts, and he's been told that will increase to 700 in the coming months. I've seen Yahoo job ads for HotJobs sales gigs, so don't doubt they're hiring, but these numbers do seem really high.

The story notes, "In the next few months, newspapers will begin beta testing of a platform that moves beyond the troubled recruitment advertising arena -- and from traditional mass aggregation of eyeballs into targeting by demographics, geography, and consumer behavior. None of the CEOs will describe in any detail what Yahoo has cooking, but they are uniformly impressed."

This testing is already happening. ClickZ reported this about a month ago, noting Yahoo has already begun testing behavioral and geo-targeting across the growing network of newspaper sites. At the time, Lem Lloyd, VP of Yahoo's Newspaper Consortium told me about 20 paper sites were testing sales of Yahoo inventory to their local advertisers, while Yahoo was testing sales of those paper sites to national advertisers. That test group was expected to expand to 50 in a month's time.

More recently, McClatchy's Chris Hendricks told me McClatchy has had two sites live in the Yahoo pilot test for display advertising for about three months.

E&P also made note of quadrantOne, the new newspaper network led by Gannett, Hearst, Tribune, and The New York Times Company. QuadOne recently added new sites from publishers already partnering with Yahoo, raising questions about the paper companies' attitude towards the Yahoo deal. The story notes, "QuadrantOne has a dedicated sales staff armed with committed inventory from each paper, though Williams could not say how many salespeople will be involved."

For the record, ClickZ reported when the network launched in mid-February that, 17 people are on board to sell CPM-based standard and rich media ads to national advertisers. Some handling ad sales out of New York, LA and Chicago are on the national sales teams at owner firms, including quadOne Interim CEO Dana Hayes and SVP Sales Donna Stokley, both top Tribune Interactive sales execs. They also planned to hire additional sales staff at the time.

Posted by Kate Kaye at 10:36 AM | Permalink | Comments (0) | TrackBack

March 21, 2008

Yahoo Mail Says: Don't Act Like Spammers

While reporting on Yahoo Mail's deliverability issues I spoke to a lot of great sources, including Yahoo. Here's a few spammy tidbits I left out. "Whenever we deploy some tighter, stricter filters, spammers are sometimes the first to complain," said Mark Risher, group product manager for Yahoo Mail. "No one considers himself a spammer; they just consider themselves aggressive e-mail marketers."

Risher closed with a word of advice for e-mail marketers. "Do whatever is in their power to make themselves look like good guys by not using tricks that spammers use, which will in the long run hurt them."

Posted by Enid Burns at 10:50 AM | Permalink | Comments (0) | TrackBack

March 10, 2008

Murdoch: News Corp. Won't Fight Microsoft for Yahoo

Speaking at the Bear Stearns Media Conference in Florida today, News Corp. Chairman and CEO Rupert Murdoch put to bed rumors of a possible tie-up with Yahoo, stating, "We're not going to get into a fight with Microsoft, they have a lot more money than us."

He went on to say that Yahoo had "missed out" in the search arena by failing to invest in Overture quickly enough after acquiring it in 2003. He added "We're very happy to be in the Google camp; they sell our search advertising and pay us well for it."

Speaking further on social networks, Murdoch said that existing sites should attempt to introduce social aspects to their offerings. He suggested that News Corp. may attempt something along the social network lines with its Wall Street Journal site, and that users would be "interested to talk to each other about their investments."

When asked about future deals, Murdoch said he was not looking for big acquisitions, but may be tempted into some smaller ones. He added that he was cautious of the high price tags assigned to online properties at present, and that it would be "very easy to throw away a lot of money on Internet sites."

Regarding the current financial climate, News Corp. is apparently in "good shape" to face a weakened economy, having reduced its dependency on advertising from 41 percent to 23 percent of revenue.

Posted by Jack Marshall at 12:46 PM | Permalink | Comments (0) | TrackBack

March 5, 2008

Could Time Warner Come to Yahoo's Rescue?

Yahoo, which rejected Microsoft's bid to acquire the firm, may be looking east for its future.

Quoting unnamed sources, WSJ.com reports today Yahoo is in talks with TIme Warner, based in New York City, over developing an alternative to Microsoft's unsolicited offer for Yahoo. Specifically, the report says, discussion is centered on folding Time Wartner's AOL into Yahoo and giving Time Warner a minority stake in the combined organization.

Yahoo rejected Microsoft's bid, complaining that it undervalued the Silicon Valley company.

Earlier speculation had focused on the possibility of News Corp. making an offer for Yahoo. WSJ.com, quoting unnamed sources, said these talks are continuing separately.

Posted by Anna Maria Virzi at 10:52 AM | Permalink | Comments (0) | TrackBack

February 21, 2008

B'lo News and Others Join Yahoo Newspaper Group

Finally I have a truly personal connection with the Yahoo Newspaper Consortium. The paper used to deliver, trudging through lake effect snow, fingers numb as I struggled to add inserts to already gigantic Sunday editions, has finally joined Yahoo's exponentially growing group of publisher partners: The Buffalo News. Well, the online edition, anyway.

Yahoo announced it’s added four new publisher partners including the B’lo News, Shaw Newspapers, Times Publishing Company and the Columbian Publishing Company. Shaw adds 25 dailies covering northern Illinois and Iowa, Times adds Pennsylvania’s The Erie Times News, and Columbian adds The Columbian of Vancouver, WA. That brings Yahoo’s total to 634 papers, including 425 dailies.

The deals aren’t all the same though. The Times and Columbian appear only to be doing the HotJobs co-branding thing. Meanwhile The Buffalo News and thirteen of the Shaw sites are going for the whole shebang, integrating HotJobs as well as adding what Yahoo’s calling “Core Services,” meaning they’ll add Yahoo Search to their sites, and sell Yahoo inventory to their local advertisers as Yahoo has access to their inventory for national advertisers.

Yahoo said it’s launched co-branded HotJobs sites “serving more than 425 U.S. newspapers,” and features Yahoo Search on 126 newspapers. It also said it’s begun the initial phase of ad cross-sales, “with the sales staffs of several newspapers integrating Yahoo inventory into sales packages for their local advertisers.” I take this to mean the planned display ad partnership has begun. The company said it will expand on that in the coming months, to allow paper partners to target specific audience segments.

Note the guy quoted in the press release is Jay Smith, President of Cox Newspapers, stating, "We're in the infancy of a relationship between Yahoo and our newspaper consortium that already exceeds our expectations.”

The reason I call this to attention is Cox was among the names floated when reports of the now official quadrantOne newspaper ad network, launched a week ago by Gannett , Hearst, Tribune, and The New York Times, prematurely surfaced. Cox, however, isn’t a member of this new network – yet anyway. The company apparently has been in discussion with the quadOne people, along with several other publishers, according to a talk I had last week with Tribune Interactive’s Dana Hayes, also quadrantOne Interim CEO.

If anything, this shows Yahoo is, at least on the surface, committed to the consortium project. Whether things remain intact after what seems to be a highly likely Microsoft grab, is anybody's guess.

Posted by Kate Kaye at 7:24 PM | Permalink | Comments (0) | TrackBack

February 15, 2008

Yahoo Body Count: 490 Axed in CA

Of 1,000 employees laid off this week from Yahoo, nearly one half came from the Golden State.

In addition to those laid off, others are voluntarily fleeing the company that's a target of a Microsoft takeover. The layoffs were announced Jan. 29, a few days before Microsoft's $44.6 billion bid.

In California, Yahoo canned 236 workers from its Sunnyvale headquarters, 111 in Burbank, 91 from Santa Clara, 52 in Santa Monica, according to a report in the SF Chronicle. The company's search advertising business is reportedly based in Burbank, while Santa Monica is home to its media properties.

Yahoo hasn't disclosed where other layoffs took place.

A New York labor department spokesman told ClickZ that Yahoo hasn't filed a notice of layoffs in New York. He said a company that lays off more than 50 workers is required to file a notice 60 days in advance. One exception: if the company lays off the workers and gives them 60-day severance.

Posted by Anna Maria Virzi at 11:14 AM | Permalink | Comments (0) | TrackBack

February 14, 2008

Yahoo Angers Shareholders, Attempts to Pacify

That $31 per Yahoo share offer from Microsoft doesn't look so bad to the folks managing The Wayne County Employee's Retirement System of Michigan's investments. Now they're
suing Yahoo in the hopes of getting Yahoo to reconsider the takeover bid. Of course, it could only be a matter of time before Yahoo agrees to a higher Microsoft offer, which would probably please the county system, which apparently owns 13,600 shares of Yahoo.

Then again, Yahoo might sell off a stake to News Corp, or do a search ad deal with Google, or any number of things to fend against an impending Microsoft grab.

In an effort to pacify frustrated shareholders, Yahoo CEO Jerry Yang sent a letter to them, rattling off what's become the standard laundry list of reasons why Yahoo still matters, and what the company plans to do to make sure it regains market share. But talk is cheap. Yang repeating the same "starting point, must-buy, open-platform" mantra seems empty without real improvement backing it up. To observers and shareholders, Yahoo could start to look like the lazy brother-in-law who keeps saying he's going to get a job, but somehow is always there on the couch watching ESPN when you get home from yours.

OK, maybe not that bad. The reality is the layoffs are all about (one assumes) belt-tightening, removing redundancy, creating efficiencies and just plain reducing overhead, which could be a good step if the still necessary people don't bail in the process.

But if anything, the people behind the Wayne County suit just might have given a few other governments and shareholders an idea.

Posted by Kate Kaye at 11:39 AM | Permalink | Comments (0) | TrackBack

February 13, 2008

Yahoo Speculation Doesn't Stop

Yahoo was never at that party talking with Google about HGH....

OK, maybe I've got my stories a little confused today, but either way, the Yahoo rumors keep flying. First the scuttlebutt was all about Yahoo and Google revisiting the possibility of Google handling Yahoo's search ad business. Today the Wall Street Journal has a piece about how Google might be souring on that idea, which some believe could make Yahoo look weaker in the eyes of Microsoft or another potential buyer.

Next off, TechCrunch has reported its got confirmation that News Corp is back in talks with Yahoo about a possible deal that would spin off Fox Interactive Media into Yahoo. A News Corp spokesperson told me, "We’re not commenting on this."

During NewsCorp's earnings call last week, chairman and CEO Rupert Murdoch said, "We're definitely not going to make a bid for Yahoo. We're not really interested at this stage," when asked about the possibility of a News Corp bid for Yahoo. As for whether News Corp is considering an AOL purchase, Murdoch response was curt: "That's an even easier question. No," he said.

Still, Murdoch's response doesn't rule out discussions between the companies or a possible deal or spin off or whatever else they can come up with.

As observers of this tantalizing tale know, Yahoo rejected Microsoft's original bid for the firm, saying it "undervalues" Yahoo's brand, audience and investments. Then Microsoft came back essentially reiterating its initial argument, and implying it'll git git git Yahoo one way or another.

The potential Google search deal would be a crushing blow to Yahoo's ego, but many think it could help the firm survive a Microsoft takeover. An FIM deal could do the same. According to the TechCrunch report, "it is widely believed that, even with a News Corp. deal, Yahoo would need to outsource search marketing to Google to make the numbers work." And that would only add to the regulatory hurdles that could hamper a Google/Yahoo search deal in the first place.

What's more riveting, watching Yahoo twist in the wind, or watching Clemens and McNamee squirm before a House committee?

Posted by Kate Kaye at 12:04 PM | Permalink | Comments (0) | TrackBack

February 12, 2008

Microsoft, Yahoo Anuncian Mobile Deals in Barcelona

At the Mobile World Congress this week in Barcelona, Spain, Microsoft and Yahoo both made separate announcements touting their mobile offerings.

Yahoo used the show to demonstrate its forthcoming Yahoo oneConnect service for mobile devices using Yahoo Go 3.0 and Yahoo’s new mobile home page, expected to be available in Q2 2008. The oneConnect service will aggregate social network connections from sites like Facebook, MySpace, LinkedIn, along with news, weather and other alerts. The service will also provide e-mail, instant messaging, text messaging connections.

Separately, Microsoft announced it had signed European mobile publishers L'Equipe, Boursier.com and Autonews in France to its mobile ad platform. The company also said mobile operator Orange picked Microsoft as its ad serving partner for mobile display advertising in Spain. What wasn't clear from the news out of Spain was whether this is a mobile ad management or serving deal only, or whether it will involve ad sales representation.

Posted by MatthewNelson at 4:02 PM | Permalink | Comments (0) | TrackBack

February 11, 2008

Microsoft Still Wants to Get it on with Yahoo...Er...Consummate

It looks like Microsoft doesn't know the meaning of the phrase, "No means no." The firm just responded to Yahoo's snub of its acquisition offer, announced this morning.

"It is unfortunate that Yahoo! has not embraced our full and fair proposal to combine our companies" said the Microsoft statement. "Based on conversations with stakeholders of both companies, we are confident that moving forward promptly to consummate a transaction is in the best interests of all parties."

For some reason, that Meatloaf tune just popped into my head...you know the one with the backseat negotiation scenario? I guess Yahoo needs to know Microsoft will really, truly love it forever.

Microsoft went on to reiterate the case it made when first publicly wooing Yahoo's Board February 1.

But don't expect Microsoft to "sleep on it." In thinly-veiled language, the firm has suggested it won't take no for an answer. "As we have said previously, Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo!’s shareholders are provided with the opportunity to realize the value inherent in our proposal," continued the statement.

It's practically Valentine's Day. You'd think Microsoft would at least try to be a bit more romantic, ya know?

Let's just hope neither of them end up praying for the end of time....

Posted by Kate Kaye at 4:58 PM | Permalink | Comments (0) | TrackBack

It's Official: Yahoo Rejects Microsoft Bid

Yahoo's board officially rejected Microsoft's $44.6 billion bid, according to a Yahoo statement released today.
"After careful evaluation, the Board believes that Microsoft's proposal substantially undervalues Yahoo! including our global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects, free cash flow and earnings potential, as well as our substantial unconsolidated investments," the statement reads. The company's board says it's evaluating strategic options, and has retained Goldman, Sachs Co., Lehman Brothers, and Moelis Co. to act as financial advisors.

Posted by Anna Maria Virzi at 9:19 AM | Permalink | Comments (0) | TrackBack

February 4, 2008

Mobile in a Combined Microsoft, Yahoo

In Microsoft's conference call last week discussing its offer to purchase Yahoo for $44.6 billion, mobile was cited as a key asset. Mobile assets combined make a significant footprint in the mobile ecosystem. That's because currently, "there really is no one-thousand pound gorilla in mobile," said Boris Fridman, CEO of Crisp Wireless, in the context of the mobile presence both companies can merge into.

Here's the rundown on Microsoft's mobile universe: Windows Mobile, an operating system with a full suite of productivity software such as Outlook, Word, and Excel, sits at the core of Microsoft's mobile footprint. MSN began advertising on its mobile portal in December, and in the U.K. in January. Its Live Mobile offering, which Sprint uses in a deal with Microsoft, runs pay-per-call ads.

A string of acquisitions including ScreenTonic, Tellme, and MotionBridge bolstered existing properties as well as filled out lacking areas. In a surprising move, Microsoft incubated and then spun off ZenZui, a graphical user interface browsing package, now called Zumobi.

Yahoo has spent time building out its own mobile offering with a multi-platform presence. The search engine began offering keyword-based mobile search ads in fall of 2006. Then it brought out OneSearch the following spring. It also developed a content-driven portal Yahoo Go, which just released a 2.0 version. Sources say Yahoo Go has been perceived as a failure inside the company. Yahoo also brings to the table several relationships with international carriers. In January it signed a deal with T-Mobile U.K., which adds to its existing relationship with competing carrier Vodafone. A separate deal includes relationships with Six carriers in Asia.

If Microsoft and Yahoo's combined mobile presence becomes the 1,000 pound gorilla in mobile, will it be a game-changer? Probably not, according to some industry sources. It will offer a great deal of inventory in multiple formats and in one place. Microsoft can streamline media buying through its global sales force and ad-buying dashboard through its Digital Advertising Solutions Group. It may become the best way to do multi-channel buys, and Microsoft can build mobile network beyond its core sites. It won't take over all of mobile, and pure-play solutions providers in the space may still be the best options for content owners, media buyers, and advertisers looking to build a presence.

Posted by Enid Burns at 4:31 PM | Permalink | Comments (0) | TrackBack

February 3, 2008

Google Weighs In On Microhoo: It May Be Evil

David Drummond, Google SVP corporate development and chief legal officer, issued the company's official response to Microsoft's proposed acquisition of Yahoo this afternoon. Essentially, Google's position is combining its two main competitors could be bad for the Internet...even border on evil.

Drummond says in the official Google statement:

"It's about preserving the underlying principles of the Internet: openness and innovation.

"Could Microsoft now attempt to exert the same sort of inappropriate and illegal influence over the Internet that it did with the PC? While the Internet rewards competitive innovation, Microsoft has frequently sought to establish proprietary monopolies -- and then leverage its dominance into new, adjacent markets.

"Could the acquisition of Yahoo! allow Microsoft -- despite its legacy of serious legal and regulatory offenses -- to extend unfair practices from browsers and operating systems to the Internet? In addition, Microsoft plus Yahoo! equals an overwhelming share of instant messaging and web email accounts. And between them, the two companies operate the two most heavily trafficked portals on the Internet. Could a combination of the two take advantage of a PC software monopoly to unfairly limit the ability of consumers to freely access competitors' email, IM, and web-based services? Policymakers around the world need to ask these questions -- and consumers deserve satisfying answers.

"This hostile bid was announced on Friday so there is plenty of time for these questions to be thoroughly addressed. We take Internet openness, choice and innovation seriously. They are the core of our culture. We believe that the interests of Internet users come first -- and should come first -- as the merits of this proposed acquisition are examined and alternatives explored."

Posted by Rebecca Lieb at 5:25 PM | Permalink | Comments (0) | TrackBack

February 1, 2008

Ad Network Integration: Can Microsoft Hack It?

The audience consolidation under a combined Yahoo/Microsoft would be extraordinary, and the integration job extraordinarily complex. The merged entity would combine portals MSN and Yahoo, plus BlueLithium, Right Media, aQuantive's DrivePM, adECN, mobile