Column : No cheer for Yahoo!

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: it an important destination for advertisers, the implementation of the deal was held back; there were fears that the US government may begin an anti-trust investigation into the deal, and the companies decided to give regulators time for a review.

In October, Yahoo reported a 64 per cent decline in net income for the third quarter, lowered its forecast given a decline in the ad market, and announced plans to lay off at least 1,430 employees. The uncertainty hadn’t been good for the company—an acquisition bid impacts growth as potential partners may defer deals, employee morale suffers, and some may even leave for safer environs. Things fell apart for Yang earlier this month, when Google announced its withdrawal from the search advertising deal with Yahoo: after four months of review, and discussing changes to the agreement, Google felt that it was best to walk away from the deal since it felt that an anti-trust case was inevitable if the deal went through.

Yang hadn’t appeared to be very keen on a deal with Microsoft initially, and had rejected the earlier offer; after the Google deal fell apart, Yang, at a conference in San Francisco, said he would be open to a deal with Microsoft. It’s interesting that Microsoft rejected Yang’s overtures: it could have well led to his downfall, given that shareholders, and indeed Carl Icahn believe that Microsoft will not trust Yang again. In that case, the search for the new CEO, is possibly the search for a CEO who will be able to sell Yahoo off—once the most dominant player in the global Internet industry.