Panicked Yahoo (YHOO) Rushing To Sign Google (GOOG) Search Deal Again

What got Yahoo (YHOO) into the Microsoft (MSFT) mess, of course, was the Terry Semel legacy of management-from-barcalounger: Unless someone places a bazooka at your head, you make decisions with the urgency of someone napping in a hammock.

And Terry’s legacy, it seems, persists. The moment Steve Ballmer walked away, Yahoo’s impressively “galvanised” efforts to put together a Google search deal flagged, and management returned to their chaises longues. But now that Icahn, Paulson, & Co. have circled the campus with torches and pitchforks, management is once again rushing to throw together that Google deal.

Peter Lauria and Holly Sanders from the Post:

Yahoo! executives are scrambling to finalise a search-advertising pact with Google in the face of a fresh challenge to its independence from billionaire investor Carl Icahn, The Post has learned. According to two sources close to the situation, Yahoo! hopes to announce the deal within the next week.

The two companies plan to structure a deal as an “open platform” system, which would allow not only Yahoo! and Google, but also Microsoft, AOL, and anyone else to bid for the right to serve up ads tied to keyword searches.

These sources said Google General Counsel Kent Walker is working hard on the precise structure and language of the deal in the hopes of minimising regulatory scrutiny, though both companies view an outsourcing deal as having no more regulatory risk than would a merger with Microsoft.

There also seems to be some surprise at the revelation that, however “open” the deal may be, Google will not be doing it out of the goodness of its heart.

See Also: Yahoo Icahn Response Calm and Smart; Here’s Icahn’s Next Move

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