The Yahoo Demolition Derby

Let’s be honest–the situation around Yahoo is just too hard to look away from now, as it has morphed into what is essentially a corporate version of a country fair demolition derby.

Except not as polite.

It is surely exciting stuff to watch, to report on and to kibitz over, as moguls rumble and, more often, bumble.

But that it has come to this is, it must be said, the real tragedy in the Yahoo (YHOO) debacle.

Billionaire investor Carl Icahn, the famed shareholder activist, is within spitting distance of winning, if not complete control of Yahoo’s board, then most definitely a substantive handful of seats on it, even though he has zero–less than zero, actually–experience in the Internet sector.

Microsoft (MSFT), one of the most powerful companies in the tech sector, still stumbling around without an adequate Internet strategy and reduced to the most unsophisticated of tactics–joining Icahn in a PR war against Yahoo that has all delicacy of mob kneecapping.

Yahoo investors–confused and increasingly panicked, as the turmoil continues and the economy heads into a definite tailspin–is left with two really unattractive alternatives: The plan-free Icahn or the current management of Yahoo, which is entirely responsible for the mess the company has landed in.

And, of course, Yahoo, one of the greatest brands in the Internet, with stellar communications and other consumer applications, with a massive audience, with impressive content offerings that are the No. 1 or No. 2 worldwide and, most of all, with an employee base that is still capable of great things.

While it is true that BoomTown has been very tough on Yahoo management over the last year, I cannot stress this enough: Yahoo remains a valuable jewel that only needs great leadership and intense focus to give it momentum.

And locked inside the company are even more treasures–a plethora of innovations in email, in publishing, in content and even in search (yes, Yahoo is No. 2, even if it feels like it is No. 31), just to name a few.

But the point has gotten much too far away from the fact that, for all its dowdy Web 1.0 image, Yahoo remains a critically important Web asset of great power.

In other words, Yahoo deserves better from all involved, from its leadership to those interested in its assets to those who bought its stock in the belief of its promise.

And while its journey over the next few months will doubtlessly be rougher still, with no clear outcome that can be accurately predicted by anyone, most of all, Yahoo surely deserves the chance to shine again.