Kara Swisher

Recent Posts by Kara Swisher

On the Menu at the Yahoo Top Managers Lunch Yesterday: Fear and AOL-oathing

yahoofood

For some reason, none of the half-dozen SVPs and EVPs I spoke to, who attended a lunch that Yahoo (YHOO) CEO Jerry Yang held yesterday for several dozen top-level execs, wanted to tell me exactly what was on the menu, because they did not want to reveal that kind of precise detail.

Fish sticks? Corn dogs? A lovely club sandwich with applewood bacon? No dice!

But no one could stop talking about the unhappiness they felt over the possible deal Yang was concocting with AOL (TWX), as an alternate to the unsolicited bid made by Microsoft (MSFT).

And they don’t like Yahoo even pursuing it as a means to get Microsoft to pay more, because it could threaten that deal, which could result in Microsoft pulling out and Yahoo stock plummeting.

“It is a very dangerous game of chicken,” said one. “And Yahoo has never been really good at that anyway.”

To be fair, after talking to dozens of employees at all levels of the company, I have found overall feelings are genuinely mixed about a Microsoft takeover of Yahoo too–they like the muscle, money and mass Microsoft brings, but are nervous to become employees of the controversial company.

But, so far, no one I have talked to wants Yahoo to hook up with AOL, including everyone I spoke to yesterday who was at the lunch, all of whom consider the Time Warner property slow-moving, weak in technology and saddled with a largely dispirited staff.

“We have enough problems without getting theirs, which are much worse,” said one exec. “No one here, except Jerry and the board, has any enthusiasm for it.”

Added another: “I cannot believe they would put our amazing assets with those who we don’t really respect, for the most part, and think that’s OK.”

And a third: “We are tired of all the noise and the angling [of this takeover] and most of us just want something to get done… This is completely distracting for employees and makes it hard to manage the big businesses we all have.”

makeover

Thus, the overall impression I carried away from my interviews? Extreme Takeover: Fatigue Edition.

Still, apparently no one explicitly voiced their concerns to Yang at the lunch, which has become a regular gathering he has been holding with top-level talent for several months now.

Instead, yesterday’s lunch topics included many things, including discussion of retention packages that are being used at Yahoo to keep valued employees from bolting, which have become an important tool over the last several months.

In addition, Yang went over some other HR issues, as well as stressing how top managers should handle messaging to the troops. (Use that old catch-all: “We are exploring all our options.”)

Yang did talk about the AOL deal, in general terms, said those in attendance, noting that the combination of Yahoo’s and AOL’s online display advertising made for a strong offering. He also praised AOL’s ad network and how it would be more powerful integrated with Yahoo’s.

(And one bright spot that everyone mentioned was AOL’s recent acquisition of Bebo, which Yahoo also looked at. But everyone also thought AOL had egregiously overpaid for the third-ranked social-networking site, which they hoped would not impact relative valuation between the companies.)

But, so far, the troops remain solidly dubious and hope for a better outcome than a mashup with AOL.

“Look, Microsoft would not be my first choice either,” said one exec, who noted, like a lot of others, that both companies did bring lots of important traffic to Yahoo. “But AOL is not even my third.”

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