AllThingsD » Carol Bartz

Former CEO Thompson Might Be Gone, But Internal Investigation Into ResuMess Still a Hot Potato at Yahoo

Kara Swisher — Tue, 22 May 2012 16:03:16 +0000

While former Yahoo CEO Scott Thompson fades from the tech scene — besides getting jacked from the top job at the Silicon Valley Internet giant, he’s also just come off two tech boards he had served on — the investigation over his hiring and how a fake computer science degree got into the company’s regulatory filings continues.

While the quick-fire controversy burned Thompson, as well as now former Yahoo director Patti Hart, the special committee of independent board members is still at work trying to figure out how such a mess was made in the first place.

And, more importantly, who knew what when and told whom.

At the time the committee was announced, Yahoo said it would “conduct a thorough review of CEO Scott Thompson’s academic credentials, as well as the facts and circumstances related to the review and disclosure of those credentials in connection with Thompson’s appointment as CEO.”

The special committee is chaired by Yahoo’s new Chairman Fred Amoroso and includes John Hayes and Thomas McInerney, two independent directors who joined the board in April.

Yahoo also hired independent counsel Terry Bird of the law firm Bird, Marella, Boxer, Wolpert, Nessim, Drooks and Licenberg in Los Angeles to handle the inquiry.

The company also noted at the time that “the special committee and the entire Board appreciate the urgency of the situation and the special committee will therefore conduct the review in an independent, thorough and expeditious manner. The Board intends to make the appropriate disclosures to shareholders promptly upon completion of the review.”

Gripped by urgency myself, I have grown weary waiting by the phone for some official answers, which sources said will not be forthcoming for some time.

But since I am the most curious of cats — uh-oh! — I started dialing around on my own to find out what’s what.

And, according to sources — especially since Thompson has settled with Yahoo and will not get severance due to the academic falsehood — the big focus is now centering on if the company’s staff screwed up the background check of his academic credentials, thus allowing it to get into its official filings with the Securities and Exchange Commission and also on Yahoo’s corporate Web site.

When Thompson was hired from eBay, where he was president of its PayPal payments division, the online commerce company had the correct bio information in its SEC filings, although not on its Web site or in its PR materials.

The question is: Did someone from Yahoo simply rely on Web bios and not check eBay filings and did anyone ever re-check Thompson’s college records? (Note: It took me 15 minutes flat to find out he did not have such a degree at Stonehill College in the Boston area.)

If lazy checking was the case, it spells rank incompetence on the part of staffers, as well as Hart, who headed the search after Yahoo fired its previous CEO Carol Bartz last fall.

A much more troubling line of inquiry taking place is aimed at the possibility that someone at Yahoo did discover the discrepancy in Thompson’s resume and either did not report it up the chain of command or did and it was either lost or ignored or, well, worse.

While this certainly ain’t Watergate, such a situation would be very hard for Yahoo to explain away as easily to shareholders, especially potentially litigious ones. As it is always said, the coverup can often be more damaging than the crime itself.

And, if it is determined by the special committee that certain employees knew of Thompson’s resume inaccuracy, it will most certainly result in dismissals of Yahoo employees.

The focus on the committee — which truly cannot sweep this under the rug, if it occurred in this much more serious scenario — is most obviously the legal department of Yahoo, which is responsible for making certain filings are accurate.

Also under scrutiny is the quickness of the hiring of Thompson.

Among the questions is how much vetting was done and whether adequate questions about him were asked among a variety of possible sources.

When he was picked in January, Thompson was a dark-horse candidate for many, including some Yahoo board members.

In fact, he was not on the initial headhunting lists prepared by outside talent search firm Heidrick & Struggles.

That’s because Heidrick had placed Thompson at eBay in mid-2000 and could not then recommend him to Yahoo. As it turned out, Thompson took it upon himself to cold email Yahoo board member and Intuit CEO Brad Smith about the job, who then passed Thompson’s interest to Hart.

Heidrick had no involvement in the checking of Thompson, although he later blamed the firm in a public meeting with Yahoo employees for putting the error in his bio in the first place from when he was hired at eBay. Heidrick quickly called the accusation “verifiably not true” in a memo to its own employees.

Sources said that meant that the firm had a resume that Thompson had submitted to it that also contained the error.

But the central mystery of how that mistake appeared on his bio will likely remain just that without further explanation from Thompson.

In a radio interview in 2009, he did not correct a specific question about the twin degrees he appeared to have held and seemed to even agree with the show’s host, Moira Gunn, about them.

Later, she told me in a video interview that Thompson had clearly indicated to her in the prep for that interview that he indeed had a computer science degree.

Still, it is still not clear — and may never be — who put the faux computer science credential on his resume in the first place.

So, with all apologies to Winston Churchill: It might remain a riddle wrapped in a mystery inside an enigma.

Fat Lady Finally Sings: Yahoo and Alibaba Officially Shake on $7 Billion Stock Sale Deal (Updated)

Kara Swisher — Sun, 20 May 2012 22:34:03 +0000

As AllThingsD reported several days ago they would, Yahoo and Alibaba Group have finally reached an agreement for the Silicon Valley Internet giant to sell back half its stake in the Chinese Web company in a $7 billion deal.

The taxable shares sale agreement, which is now being approved by both boards, is part of a larger and more complex arrangement, which will also include a multibillion-dollar stock buyback by Yahoo and an eventual IPO of Alibaba.

And, perhaps most importantly, it will bring to an end what could be the longest running global cat fight in Internet history, in which the long-time partners have bickered over the terms of their relationship for years now.

It has mostly been over how they could get to the transaction they should be announcing later tonight (or morning in Hong Kong, which it is there now). While it could fall apart at the last minute, that is highly unlikely at this point.

(Update: The Yahoo board has approved the deal unanimously, said sources, so it is done done.)

(Update 2: Yahoo and Alibaba both confirmed the deal in a joint press release, which is below.)

Thus, after many failed attempts to strike a tax-free deal — also involving Yahoo’s Japanese partner, SoftBank — collapsed, the pair have finally settled on a taxable deal, which could net Yahoo upwards of $4 billion.

The transaction values Alibaba at $35 billion and is subject to a number of funding issues that could change the value of the deal.

But here is the overall situation, as I previously reported:

Yahoo is set to sell half of its roughly 40 percent stake in Alibaba, in a taxable deal. The transaction is likely to value that portion of Yahoo’s holdings at about $7 billion — or 20 percent of Alibaba’s $35 billion enterprise valuation. Alibaba is in the midst of raising capital to fund the sale.

After taxes of upward of 35 percent are paid on the long-term gains — remember that Yahoo bought the now-lucrative Alibaba stake for just $1 billion in 2005 — the company will use the funds to buy back its own shares. That stock has been caught in the mid-teens doldrums for quite a while, so this could help boost shares significantly.

A shareholder dividend is also being considered by the Yahoo board, but it is unlikely. It’s also not clear if some of the cash will be held back for acquisitions by Yahoo, sources added, but it is also unlikely.

As part of the deal, sources said, medium-term incentives have been put in place for Alibaba to move forward with a public offering, which sources stressed is without contractual obligation or a time frame. Alibaba execs have already been publicly indicating such a direction recently, but this will put them more firmly on that path.

Although there are no plans to go public as yet, the IPO incentive revolves around several terms, including the right to buy back half the remaining stake, which expires in December of 2015. As I previously reported, Yahoo will be required to sell back half of the 20 percent remaining stake upon IPO and the other half after that if Alibaba goes public in the time frame agreed to.

Lastly, the Alibaba voting rights for both Yahoo and SoftBank are much diminished in the new deal, according to sources, to under 50 percent.

Translation: Alibaba CEO Jack Ma is now in the driver’s seat completely.

Once close, the pair have been wrangling over the large Yahoo ownership, which Ma has been trying to dislodge in a variety of nice and not-so-nice ways. It has resulted in a number of very public disagreements.

That included a nasty back-and-forth over its Alipay unit with now-fired CEO Carol Bartz, threats of takeover of Yahoo with private equity firms and, more recently, making friendly with its just-ousted CEO, Scott Thompson.

Those talks with him in recent weeks, which included a visit to China by Thompson, led to the new deal, which was negotiated primarily between Yahoo’s CFO Tim Morse and legal head Mike Callahan and Ma and Alibaba’s Joe Tsai.

The talks continued even as Thompson was suddenly engulfed in a controversy over a fake computer science degree on his resume that quickly led to his departure from Yahoo.

Ironically, the error was first discovered by activist shareholder Daniel Loeb, who is now voting on the deal as a newly named director of Yahoo, after successfully helping to oust Thompson.

He owns almost 6 percent of Yahoo.

The final decision to approve the deal was in the hands of a very new board of Yahoo, which has been drastically reshaped in recent weeks. It met to decide on the deal this weekend.

While the deal with Alibaba is finally nearing an end, Yahoo’s talks to sell its 33 percent stake in Yahoo! Japan is not part of this agreement. That’s due to what Thompson had called a “valuation gap,” which sources said is still an outstanding issue.

New interim CEO Ross Levinsohn has not been involved in the Alibaba deal in any significant way. But he certainly will benefit from its halo effect, if approved, especially given that it will likely boost Yahoo shares.

It also puts Yahoo in a unique situation, in which it must sink or swim more largely based on the value of its troubled core business.

That could mean a lot of things, including the eventual sale of the company, whose most lucrative asset recently — its Alibaba holding — will matter much less.

As soon as I get the press release, I will post it here, but no one is commenting, despite the inevitable happy ending to this long-running story.

And here’s the press release, finally:

Exclusive: Yahoo Finally Set to Strike Alibaba Share Deal -- Half Now, Then Half of What's Left After Eventual IPO

Kara Swisher — Fri, 18 May 2012 06:39:00 +0000

Yahoo is in the final stages of selling a large chunk of its stake in the Alibaba Group back to the company — in a complex deal that is set to include a multibillion-dollar share buyback to investors of the Silicon Valley Internet giant and an eventual IPO of the Chinese company — according to multiple sources close to the situation.

The deal has yet to be officially approved by the boards of both companies, but sources said it is likely to be, and could be announced as early as Monday.

This all could change, of course, since negotiations between Alibaba and Yahoo have taken place in a variety of ways in recent years, without success and with much acrimony. Talks over a tax-free deal — also involving Yahoo’s Japanese partner, SoftBank — collapsed in February, for example.

But the 324th time is apparently the charm — so here are the details of what looks to be a nearly complete agreement that I have ferreted out thus far from lots of relieved sources familiar with the situation:

Yahoo will sell half of its roughly 40 percent stake in Alibaba, in a taxable deal. The transaction is likely to value that portion of Yahoo’s holdings at about $7 billion — or 20 percent of Alibaba’s $35 billion enterprise valuation. Alibaba is in the midst of raising capital to fund the sale.

After taxes of upward of 35 percent are paid on the long-term gains — remember that Yahoo bought the now-lucrative Alibaba stake for a fraction of that, many years ago — the company will likely use the funds to buy back its own shares. That stock has been caught in the mid-teens doldrums for quite a while.

A shareholder dividend is also being considered. It’s not clear if some of the cash will be held back for acquisitions by Yahoo, sources added, but it is unlikely.

As part of the deal, sources said, incentives have been put in place for Alibaba to move forward with a public offering, which sources stressed is without the contractual obligation or a time frame. Alibaba execs have already been publicly indicating such a direction recently, but this will put them more firmly on that path.

In return, Yahoo has agreed to sell the remaining quarter of its current holdings when that IPO does occur. It would then have an only 10 percent stake of Alibaba, which it could sell at any time after the IPO.

If finally struck, the transaction will finally bring to an end one of the more protracted and disputed relationships in the Internet world.

Once close, the pair have been wrangling over the large Yahoo ownership, which Alibaba CEO Jack Ma has been trying to dislodge in a variety of nice and not-so-nice ways. It has resulted in a number of very public disagreements.

The talks continued even as Thompson was suddenly engulfed in a controversy over a fake computer science degree on his resume that quickly led to his departure from Yahoo on Sunday.

Ironically, the error was first discovered by activist shareholder Daniel Loeb, who will now vote on the deal as a newly named director of Yahoo, after successfully helping to oust Thompson.

He owns almost 6 percent of Yahoo, and is expected to approve the transaction.

But the final decision to approve the deal will be in the hands of a very new board of Yahoo, which has been drastically reshaped in recent weeks. It is meeting tomorrow and perhaps over the weekend to vote on it.

While the deal with Alibaba looks to be nearing an end, Yahoo’s talks to sell its 33 percent stake in Yahoo Japan is not part of this agreement. That’s due to what Thompson had called a “valuation gap,” which sources said is still an outstanding issue.

Next up for Levinsohn, who has just rejiggered Yahoo management again, other sources said, is an effort to settle the patent-infringement lawsuit with Facebook, and also to renegotiate its search deal with Microsoft.

And, oh yes, fix Yahoo’s rocky core-advertising business, which is still in distress and needs a major overhaul to push it back to growth.

But that, as they say, is yet another episode of Yahoo’s ongoing reality show.

Yahoo’s Roller Coaster Impacts More Than Shareholders

Rusty Rueff — Tue, 15 May 2012 15:00:00 +0000

Getty Images News | Justin Sullivan

Here we go again. After just four months, Yahoo has taken the CEO reins from Scott Thompson and passed them to interim CEO Ross Levinsohn, marking the fifth change in the company’s top job in the past four years. During this time, the company’s market cap has deteriorated from $28.53 billion at the end of June 2008 to $19.04 billion today, clearly indicating what the revolving CEO suite and associated roller coaster has done to shareholder confidence. But what about the impact on the 13,300 people employed by Yahoo?¹ Clearly, this is something the Yahoo board of directors and Levinsohn — however interim he is — must address, if they hope to achieve a turnaround.

Think about it: Yahoo employees who have weathered multiple rounds of layoffs have also had to adapt to the frequently changing leadership tides created by the revolving door at the top of the company: Jerry Yang, Carol Bartz, Timothy Morse, Scott Thompson, and now Ross Levinsohn. Not surprisingly, this has impacted Yahoo employees’ faith in senior leadership over time.

According to social jobs and career site Glassdoor, morale at Yahoo has softly teetered from quarter to quarter. On a five-point scale, employees have given the company a high rating of 4.3 (satisfied) in the first quarter of 2008 to a low of 3.0 in the second quarter of 2009; however, the rating has settled around 3.4 (okay), for the most part.

However, the employee sentiment surrounding how well each Yahoo CEO has led the company has had a much more turbulent path. When Carol Bartz started off, she had a 91 percent approval rating in her first quarter, but by her last quarter on the job, it sank to just 33 percent. For Thompson, it was too short to tell if his 48 percent approval was a starting-off point based on employee satisfaction, or if it was his personal high note.

Evidence of this employee turmoil, along with a desire for more direction and stability, can be found in many of the anonymous reviews left by Yahoo employees on Glassdoor in recent months:

As one Yahoo senior financial analyst comments, “Develop a clear strategy, and stick to it! Way too much disparity in communicating what it is the company stands for.”

A Yahoo principal engineer adds, “The lack of vision is really astounding … Executive management should try better communicating with senior management and solicit their input when making such major personnel changes. There should be clear strategic goals conveying what is trying to be accomplished.”

Another Yahoo employee notes that Yahoo “lacks a clear vision of what the company is all about. The sooner they figure this out, the sooner they can focus their resources in the right direction.”

Employees know the company best. As a leader, you may think you know, hear and understand your company’s challenges, but if you fail to listen to your employees and therefore fail to address those challenges, you will likely find the road to growth and change within the company tougher than expected.

Now, perhaps more than ever, Yahoo’s executives and board should listen to and focus on what’s at the heart of the company: Its employees. Some proven strategies that can support stabilization and rebuilding the business include:

Leadership must extend beyond one title or one person. There are a lot of executives on the Yahoo management team beyond interim head Levinsohn, some of whom have extensive tenure with the company, including co-founder David Filo. This team needs to quickly build consensus on strategic priorities and collectively own responsibility to make sure this is communicated and understood by the entire Yahoo employee population. The new permanent CEO should build on this foundational direction, not deviate from it or completely change it.

Define your vision, stick with it and repeat. Where the company is headed should be articulated in one clear, crisp statement, and as CEO or as a senior leader, it should be used and touched on routinely in all communications, both internally and externally. There is a lot to get done as a leader; there is a lot to convey. But without purpose and vision, efforts to move a business forward will fall flat.

Don’t mistake perks for culture. In the Valley, where talent wars are fierce, we often regard perks as synonymous with culture. While a hefty paycheck, bonuses and other perks like free food, on-site dry cleaning or on-campus childcare may help recruit top talent, they don’t do much to retain talent the way a solid and positive culture does. A good culture takes time, and emanates from a work environment that provides room for — and rewards — creative thinking, and allows opinions to be heard and to be challenged.

Get personal. I suspect that the trust level of senior management has been seriously compromised, and this last blow regarding Thompson’s degree has hurt whatever trust was left. It’s going to be a tough road ahead for Levinsohn and his succession when it comes to winning the hearts of employees. But Yahoo’s senior leadership can make it right, if they make it personal and swing for the fences in communication by hosting small group meetings and by truly showing that management is listening to the wishes, desires and dreams that employees have for the company and for themselves.

This is another critical juncture for Yahoo. With the board and management team in transition, it is especially important that time and resources be dedicated to rebuilding a new social contract with Yahoo employees around the world. Employees come to work every day and vote with their feet for the company to succeed, and it’s the responsibility of senior leadership to work on bringing together the troops to get the company back on track.

Rusty Rueff is a corporate and philanthropic board director, career and workplace expert consultant and writer, as well as start-up company adviser and investor. He currently serves on the corporate boards of Glassdoor, the leading social jobs and career community, and HireVue.com, a video interviewing platform designed to improve the recruiting process. Rusty is also the co-author of “Talent Force: A New Manifesto for the Human Side of Business” (Prentice Hall, 2006).

¹ Yahoo employee counts based on information provided at end of Q1 2012 in Yahoo Investor FAQs.

Leave the Gun. Take the Cannoli: It's Ring-Kissing Time for Ross at Yahoo's All-Hands Meeting.

Kara Swisher — Tue, 15 May 2012 02:12:22 +0000

At today’s all-hands meeting for Yahoo employees — in the wake of the dramatic ouster of its former CEO Scott Thompson — what pop culture icon did new interim CEO Ross Levinson use to loosen up the crowd?

Why, a little Al Pacino from the movie classic “The Godfather,” of course — the go-to guy solution menu for all troubles in the world.

Comparing the battered Silicon Valley Internet giant to Don Corleone after a gun ambush, Levinsohn said to the crowd gathered at URL’s Cafe on the Sunnyvale, Calif., HQ campus: “This weekend was like that scene from ‘The Godfather’ — ‘They hit ’im with five shots, and he’s still alive!’”

And also, trying to make Yahoos feel as if there were forward momentum: “There are things being negotiated now that are gonna solve all your problems and answer all your questions.”

Well, let’s hope so, and that it does not end for Yahoo — and Levinsohn — like it did for Luca Brasi (who sleeps with the fishes, in case you didn’t know).

So far, in his first impress-the-employees outing, the reviews for Levinsohn were largely positive on its internal message boards and from numerous sources I talked to.

What they liked: Acknowledgement of the tough past week, but not dwelling on the past, either; a theme of revival and spirit; no PowerPoint slides; and zero direct mention of Thompson.

What they really liked: The whole pile of compliments that Levinsohn doled out to the troops.

No tough-love dude he — unlike Thompson and his predecessor Carol Bartz, who liked to verbally smack around the troops a little more in a mobster kind of way.

Instead, said one person in attendance, “he was appealing to Yahoo pride, which is pretty much in the doldrums.”

Still, one questioner worried about the future and whether the company was going to still be stuck in a leadership vacuum, especially since Levinsohn was not named as the permanent CEO.

Fred Amoroso — who was just named Yahoo’s new chairman and was the only person who appeared with Levinsohn on the stage — tried to assuage that concern by saying he wanted Levinsohn to eventually become the head of the family for good.

While there will likely be a search for other CEO candidates, it is as close to a ring-kiss as Levinsohn is going to get for now.

That is, unless he does not produce some quick results on a variety of Yahoo’s thorniest issues, such as an Asian asset sale and a settlement of the patent lawsuit fight with social networking giant Facebook.

But the over/under on him and Amoroso together was good.

One person said it was important when Amoroso talked about coding and technology and products, which is not advertising- and media-focused Levinsohn’s expertise.

“It was nice to see a board member who cared about products and innovation,” said one person. “Or at least said he did.”

We’ll see how this pair works out together, but always remember this, Yahoos:

Just when you thought you were out, they pull you back in.

Until we know how the movie ends, here is a scary video of me talking about the last week’s events at Yahoo on a local ABC television news station — I look a fright since I’m so tired from covering it all:

Six Ways Yahoo Can Get Cool Again (Comic)

Voices — Mon, 14 May 2012 22:21:46 +0000

Here is the latest comic from our Joy of Tech friends at Geek Culture, Nitrozac and Snaggy. Joy of Tech appears three times a week in the Voices section of this site.

Ross Levinsohn's Yahoo Plan: Back to the Future

Peter Kafka — Sun, 13 May 2012 23:08:16 +0000

Ross Levinsohn wants to be known as more than a deal guy. Now he gets his chance.

Assuming Yahoo gives its interim CEO real power — either by making him its actual CEO, or at least letting him behave as if he has the job — then he’ll finally have full control of a giant media company. That’s something he’s been working toward for a long time, despite his rep as a guy who enjoys buying companies more than running them.

Just like his predecessors, Levinsohn will have to untie Yahoo’s knotty Asian problem. He’ll also have to spend time repairing relationships with Facebook and figuring out what to do with a Microsoft search deal that hasn’t been a huge success.

But if Levinsohn gets to run Yahoo the way he wants to run Yahoo, he’ll focus on getting the most out of its media business, because that’s his strength.

Bear in mind that this is still a huge business — the portal attracts some 700 million visitors a month, which helped it generate nearly $1 billion in ad sales last quarter. But that business is listing and under attack from Google, Facebook, and a swarm of nimble start-ups pulling eyeballs and dollars away.

If you want to get a sense of what Levinsohn may try to do next, it’s good to review what he did last year, when he had control of the company’s U.S. operations — and what he tried to do but couldn’t get done.

Ads: Yahoo used to have one of the Web’s best sales operations, but those days are long gone. Levisonsohn spent much of 2011 trying to fix that. Part of that involved restaffing his team, and part of it was a strategy that was supposed to cut out some of the ad tech middlemen and allow the company to increase its yield on the ads it sold. Those moves, which included a would-be alliance between Yahoo, AOL and Microsoft, all went into a holding pattern when Scott Thompson took over in January. Levinsohn will try restarting that again now.
M&A: Levinsohn has a reputation as a dealmaker because he’s made some pretty big deals. Most notably, he brought Myspace to News Corp. in 2005, then helped the company secure a $900 million ad deal with Google (News Corp. also owns this Web site). Last year, he tried to land another big fish, when he pushed to pursue Hulu. But Levinsohn couldn’t get buy-in from then-CEO Carol Bartz, and Hulu’s owners decided not to sell after all. I think Levinsohn would still be interested in the site under certain conditions, but he’d need more cash than he has on hand to do it. Selling off his Asian assets might make that possible. If he can’t land Hulu, I don’t see him chasing after Instagram-like companies with big price tags and no near-term revenue plans. I do see him making some plays on cheaper start-ups, as well as some technology plays, to shore up/replace the company’s very old infrastructure/platforms.

Meet the Man I Call "The Hair": The Video Stylings of Yahoo's Newest CEO Ross Levinsohn

Kara Swisher — Sun, 13 May 2012 19:03:01 +0000

Over the many years I have covered Yahoo’s expected new interim CEO Ross Levinsohn, I have done several video interviews with him.

And, for my own amusement, I also have nicknamed him “The Hair,” due to his very impressive mane.

We’ll see how impressive the longtime digital media exec will be now that Levinsohn has become the latest head of the Silicon Valley Internet giant.

His job is only interim for now, but in selecting him, the Yahoo board is opting for a more media-centric approach.

Among his claims to fame: He was president of News Corp.’s Fox Interactive Media, where he bought the then-soaring Myspace social networking site. Levinsohn managed to get Google to fork over more than double its price in advertising guarantees and luckily left the company before it went off the rails.

He was also an exec at AltaVista, an early search pioneer, and was head of content and development at CBS Sportsline. Levinsohn also dabbled in investing at Fuse Capital, with current News Corp. digital head Jon Miller focused on digital media and communications companies.

When he was at Fuse, ironically, Levinsohn and Miller were also raised as possible board members by Carl Icahn, who has conducting a different proxy fight against Yahoo.

In the latest fighting, at least, Levinsohn appears the victor.

To assess him, here are two videos I did with him — one in 2007 when he was at Fuse and one from last year at our D: All Things Digital conference (I ask about his hair-care product at the very end).

I also added a recent mockumentary video that Levinsohn for Yahoo’s recent Newfront media presentations in New York, which is pretty funny (and, in Carol Bartz channeling, Levinson curses at the end!):

[ See post to watch video ]

Heidrick & Struggles Slaps Back at Thompson's Yahoo in Blame Game Over ResuMess

Kara Swisher — Sat, 12 May 2012 01:39:30 +0000

And it just gets worse in the controversy over Yahoo CEO Scott Thompson and the circumstances around how a fake computer science degree could get onto his bio.

Heidrick & Struggles is smacking back at him for insinuating that the well-known headhunting firm had messed up his resume.

In meetings with employees to attempt to explain the situation yesterday, multiple sources said that Thompson claimed that a mistake made by a headhunting firm in mid-2000, when he was moving to a job at eBay, was the way the inaccuracy got into his bio.

Thompson did not name the firm, but he was clearly referring to Heidrick & Struggles, which handled that placement. It was also working on the Yahoo CEO search, after the Silicon Valley Internet giant fired its former CEO Carol Bartz last fall.

But, because it had originally placed Thompson at eBay, the firm did not work on his hiring at Yahoo.

So, Heidrick was not going to take Thompson’s blame for the botched bio.

“While we were not involved in this placement, there have been both direct and indirect mentions of this relationship in several news articles. Furthermore, if recent media reports are accurate, the CEO of Yahoo! has made potentially damaging allegations about our firm that are simply not true and cannot be allowed to stand in the public record,” wrote CEO Kevin Kelly to staff. “The media articles in question have indicated that the Yahoo! CEO told members of his senior staff that, many years ago, a junior member of our firm invented an academic credential for him in the course of preparing standard profile materials. Based on information in our possession, this allegation is verifiably not true and we have notified Yahoo! to that effect.”

This letter is just another brick in what is looking like an insurmountable wall for Thompson to keep his job at Yahoo. Sources said that the board of Yahoo had been sent a letter from Heidrick on the matter earlier today.

And, let me just say, this latest eruption is simply not good for Thompson’s chances to remain CEO for much longer.

Yahoo declined to comment, but here is the full letter from Kelly to its staff:

Is He In or Is He Out? Crunchtime for Scott Thompson at Yahoo.

Kara Swisher — Fri, 11 May 2012 15:15:28 +0000

While he has only been CEO of Yahoo for less than five months, in the next several days Yahoo CEO Scott Thompson is facing perhaps the most critical moment of his short tenure.

According to sources with knowledge of the situation, the board of Yahoo is not likely to take long in assessing whether he will stay or if he will be let go, due to a controversy around how a non-existent computer science degree got on his bio and also in Yahoo regulatory filings.

A special committee of independent directors is now investigating the matter, including trying to assess the damage has had on Thompson’s ability to lead the Silicon Valley Internet giant.

How quickly the board moves is likely to be a sign of their intent. If within the next days, it is likely to let the former president of eBay’s PayPal payments unit go and replace him with a current company exec; if it waits longer and shows some public support of him — which the board has not done since the scandal erupted — Thompson’s chances are better that he will only be given some sort of censure.

One important task is also closely considering the impact of possible legal problems related to Thompson and others signing documents with the Securities and Exchange Commission that were not accurate.

One thing is clear from interviews with multiple sources, many members of the board have not been happy with how Thompson has handled the matter since activist shareholder Daniel Loeb of Third Point uncovered the problem a week ago.

While first tossing the borked bio as an “inadvertent error,” Thompson was then largely silent about the issue with staff, despite being in close meetings with them, which caused stress among key execs.

Then, he made a public announcement in which he apologized for only the “distraction” caused by the incident and not the error itself as some had hoped he would.

Yesterday, apparently feeling it was time to try to explain things face-to-face, Thompson made another attempt to explain what happened in two separate meetings with his direct reports and then his senior staff, apparently trying to get through to employees that he did not fake his resume nor did he give an inaccurate bio to Yahoo when he was being hired for the job earlier this year.

Thompson thought it was time — now that the board investigation was underway — to answer questions directly, said a source.

Among other things, Thompson gave a somewhat convoluted explanation that it appeared in his bio due to a misunderstanding during an interview with a headhunting firm. And that he never noticed it once it proliferated And that when an NPR interviewer asked him directly about his CS degree, he did not want to correct her in mid-discussion — although others report he said he did not hear the question fully.

Sources said Thompson — who is on the midst of initiating changes across a large and troubled organization, after laying off 2,000 employees — thought the sessions went well, that he clearly communicated that he was taking blame for the problem and its repercussions. Those sources also noted that he received support for doing so after the talks.

But, more than a dozen others I interviewed who were listening remotely — some of whom I sought out and some who contacted me directly — thought Thompson’s complex explanation was deeply problematic and that he tried to foist the blame on others rather than on himself.

Every one of these people expressed the need for him to step down to allow Yahoo to move forward.

What the board thought about the performance is still not clear, said sources, but things are coming down to two distinct scenarios.

The first is a quick parting of the ways with Thompson, within days, either for cause or via a negotiated settlement. Others at Yahoo involved with perpetuating the mistake in the bio are also at risk.

This option is perhaps the more likely at this moment, unless the scandal dissipates and employees continued rancor over the situation can be assuaged soon.

In this case, sources said, Thompson will be replaced by a current board member or a member of the top staff. When directors fired Carol Bartz last fall, CFO Tim Morse became interim CEO and he is one of the likely candidates for the job again.

The second scenario centers on needing Thompson to complete a number of complex transactions related to the sale of Yahoo’s Chinese assets and its re-negotiations with Microsoft over its troubled search partnership, among other things.

In that case, Thompson will be censured in some manner by the board and will also probably have to endure some punishment for allowing false regulatory documents to be filed by Yahoo. Others at Yahoo will also be subject to the same treatment in such an outcome.

How will it turn out?

Only board member Patti Hart has so far paid for her faulty vetting of Thompson, stepping down from the board earlier this week.

But whether she will be the only shoe to drop in what has turned out to be a bizarre wildfire that as raged across Yahoo’s troubled landscape remains to be seen.

Thus, most definitely watch this space this weekend.

Loeb Calls Again for Thompson Firing From Yahoo, as Former eBay Boss Supports Him

Kara Swisher — Wed, 09 May 2012 14:33:40 +0000

As expected, activist shareholder Daniel Loeb of Third Point released a new letter on the bio controversy he set off at Yahoo, again calling for the firing of its CEO, Scott Thompson.

“It seems farcical to us that the Board will most likely spend more time deliberating over whether Mr. Thompson should be fired than it did properly vetting whether he should have been hired,” read the letter in part. “The necessary investigation into whether certain senior executives and Board Members knew of Mr. Thompson’s deceptions before hiring him should not delay decisive action over his ethical breaches.”

Loeb, who is waging a proxy fight with Yahoo over board seats he wants, also offered to work with the Yahoo board to find a new CEO if it accepted his slate of directors. In the interim, he suggested Yahoo put either CFO Tim Morse or media head Ross Levinsohn in the job. Morse had taken that position temporarily after Yahoo fired its last CEO Carol Bartz last fall.

Confused yet?

Loeb set off a management crisis there last week with the revelation that Thompson had added a fake computer science degree to his bio.

The first casualty came yesterday with the stepping down of Yahoo director Patti Hart, who was charged with vetting Thompson for the job.

The Yahoo board also announced yesterday that it would be conducting a probe of the circumstances around the hiring, as well as how the faux academic credentials got in Thompson’s bio and also the company’s regulatory filings.

The new letter was a reaction to Thompson’s apology on Monday for the borked bio becoming a “distraction” (but not, oddly, for the mistake itself). Loeb had previously called for Thompson’s firing over the bio fibbing.

Loeb will be appearing at an investor conference in Las Vegas later today, where he will surely be asked about the situation.

In related news, eBay CEO John Donahoe, Thompson’s former boss, lent words of support, but also underscored that the online commerce company’s legal filings of his bio were always correct, even if its Web site and other PR documents handed out were not. Thompson came to Yahoo from a stint as president of eBay’s PayPal payments unit.

As reported by Bloomberg, Donahoe said:

“When Scott was hired at EBay Inc., all of EBay’s filings had the accurate information. Some of EBay’s PR materials had that bio. Our legal filings were taken care of by our legal department. Some of the PR materials had that info,” he said while in Tokyo of the correct bio versus the incorrect one.

Donahoe added: “I think Scott Thompson did a great job at PayPal. I think he’s a very talented leader and I believe he can help Yahoo. I hope they get through this and he can continue to do the very challenging job he’s got of helping to turn Yahoo around. I’m Scott’s biggest fan.”

This has been the first public support of Thompson by a prominent Internet figure, which might help lagging morale at the company.

Here’s the full version of the latest Loeb letter:

Third Point May 9 Letter Release

They Shoot Yahoo CEOs, Don't They? But Not Without a Really Smoking Gun and a Much Stronger Board.

Kara Swisher — Sat, 05 May 2012 16:33:02 +0000

Earlier today, Yahoo’s persistent thorn, activist shareholder Dan Loeb of Third Point poison-penned another letter to the board of the Silicon Valley Internet company, demanding that Yahoo fire its new CEO Scott Thompson, as well as director Patti Hart, over bizarre inaccuracies related to their academic achievements.

“Permitting Mr. Thompson and Ms. Hart to stay with the Company after apparently violating the Code of Ethics sends a message to all Yahoo! employees that a different set of rules applies at the top,” Loeb wrote.”[Yahoo must] terminate Mr. Thompson for cause immediately given his demonstrable unsuitability to remain Chief Executive Officer and a director of Yahoo! and accept the resignation of Ms. Hart for similar reasons.”

And while many across the blogosphere — including some very clever tweets — called for his head tout de suite, that’s just not going to happen.

At least for now, at this early point in a controversy over Yahoo filing legal documents that misrepresented Thompson’s long-ago degree from Stonehill College.

In a nutshell: Thompson does not have a computer science degree, as he had maintained he did in public bios for almost a decade, a falsehood that mysteriously seeped into documents Yahoo filed with the Securities and Exchange Commission.

That’s bad news for Yahoo, for sure, on many levels, but moving against Thompson at this moment is not likely to be the answer — for the short term, at least.

That’s due to many reasons, that I like to think of it as three hopelessly complex puzzles that need solving pronto.

The What-Did-Yahoo-Know-and-When-Did-It-Know-It Question

There is no question the first thing Yahoo’s board needs to do is a thorough investigation to determine how a borked bio could proliferate so widely and for so long.

Most importantly, Yahoo will have to reveal if Thompson actually gave them this incorrect information, as he aggressively lobbied for the then-open CEO job.

As I had previously reported several times, Thompson cold-emailed a Yahoo director — Intuit CEO Brad Smith, as it turns out — despite not being on the list of potential candidates. Thompson was then shuttled over to Hart, who was running the vetting process with the help of headhunting firm Heidrick & Struggles, and hired within weeks.

Oddly, sources said Thompson never filled out the required informational papers for the job, nor did Heidrick conduct the normal background check on him. Instead, another forensic firm Yahoo hired did the work.

If it turns out Thompson gave any of them the bad bio info, it would be quick curtains for him.

But if Yahoo’s board members obtained his info on their own, the next key query would be how no one at Yahoo — especially its legal and compliance staffers, as well as outside help — managed to catch the problem during the vetting of Thompson.

Here are some good questions to start with:

Who put a faux computer science degree on Thompson’s bio in the first place, why and when did it happen?

Where did Yahoo get the inaccurate information?

Who was in charge of checking Thompson’s academic record for Yahoo?

And, who checked the work of the checkers?

The problem is made more complicated, because correct information was easily available in the SEC filings of eBay for years, since Thompson was head of its PayPal payments unit.

While the resume information was indeed wrong on eBay’s Web site and on numerous bios of Thompson for years, how did eBay legally get it right while Yahoo did not?

That calls into question the expertise of the company, its directors and those they hired to make sure execs were completely on the up and up, a task they clearly failed at.

If rank incompetence is the reason, which it looks like it might be, expect certain board members and other Yahoo staffers to go, along with anyone who helped in the Thompson vetting, or lack thereof.

Unless, of course, the gang-that-couldn’t-shoot-straight actually did shoot straight and some one at Yahoo found out about the educational discrepancy before the new CEO was announced, but declined to fix it.

While sinister, such a scenario is not entirely implausible, given how much pressure Yahoo was under at the time to hire a CEO quickly, due to Loeb and his looming proxy fight.

If any evidence were to surface that this was so, it is curtains all around, which would rain the kind of disaster down on Yahoo’s Sunnyvale HQ that would make Loeb’s attacks look like a Nerf battle. Instead, it would be “The Hunger Games” — except that no one survives.

The Chaos-in-Sunnyvale Conundrum

Which brings us to the profound implications of Yahoo jacking its second CEO within six months.

While it’s easy to yell “Fire the CEO” on a crowded Twitter, it’s simply not so easy in practice.

How long did it take Yahoo’s lugubrious board to figure out Carol Bartz needed to go? A … long … time. (And, she had a CS degree!)

More to the point, Thompson — and his not-so-merry band of consultants from Boston Consulting Group and, this week, McKinsey & Company — has only just completed a massive layoff of 2,000 employees and a jarring restructuring of management.

He’s also in the early stages of rolling out a new and decidedly still-squishy strategic plan to top execs (also just this week), along with working on some other key initiatives.

That includes renegotiating its search partnership with Microsoft; noodling around on a possible deal with Google; contemplating the sale of a variety of assets; and — oh, yes — trying to take on social networking Godzilla Facebook over patent infringement.

Busy much?

But, most importantly, Thompson is now the umpteenth Yahoo CEO to be working on the never-ending talks with its Asian partners over selling back a piece of the company’s lucrative stake to them.

While Yahoo CFO Tim Morse and head lawyer Mike Callahan are the point men on the deal, the lack of CEO would be an issue in the now-proceeding again talks.

This is a sale that must — and I underscore must — get done and soon, giving Yahoo much-needed breathing room and a whole lot of cash to fork over to increasingly disgruntled shareholders.

So, expect Yahoo to try to milk that deal for all it’s worth in the coming week, in order to give the appearance, at least, of positive forward momentum.

And, like it or not, Thompson has to play a key role in it getting done.

Thus, the likelihood of wait-and-see over point-and-shoot on Thompson is higher than you might think.

That’s especially true given four members of the board are leaving within six weeks and have either or are in the process of being replaced by new members.

Then, Thompson will be their problem to solve.

Again, no small thing, since the old crew — led by feckless Chairman Roy Bostock — is not likely to want to end its appalling tenure with yet another disaster.

Such a move would further tarnish the legacy of its outgoing directors, although I am not sure how it could be any more sullied, given their consistent record of one bad decision after the next.

What do I really think? I think this cursed board will maintain its 100 percent score of doing the wrong thing at the right time.

It could be a different case with the new directors, of course, who all seem pretty sharp and not as easily impressed by a record of failure.

They will surely be monitoring Thompson carefully, as will employees, who have taken to internal message boards with a rage not seen in a while over the resume debacle.

Their morale might be one uncertainty impacting Thompson’s fate. If a lot of key employees continue to bolt Yahoo or those remaining more loudly express their disdain for the bio antics, the new directors might listen.

The Whatever-Loeb-Says-We-Won’t-Do-Till-Later Head-Scratcher

Which brings us back to Loeb, whose noisy campaign to grab seats on the Yahoo board has certainly hit home this week.

And, though Yahoo likes to ding him a lot, since he started his campaign of terribly entertaining investor terror, a lot of what he’s been calling for has happened.

That includes a major flushing of the board — with five longtime members, including co-founder Jerry Yang, going, going and gone.

In addition, Loeb brought pressure to slow down some questionable deals, from Yahoo’s PIPE dream to a tax-free spinoff in Asia in a deal only an accountant could love.

He’s also — though they try to deny it — got the Yahoo directors in the dangerous habit of reacting to him, rather than playing their own game.

While the Yahoo board has resisted any deal with Loeb (pictured here), blaming him for rejecting their kind offers of settlement, it is he who is setting the tone more than Yahoo.

And that tone is of alarm and trouble and chaos at Yahoo.

That’s not going to work to convince other Yahoo investors to back his cause — in fact, Loeb has a decidedly uphill battle to win his proxy challenge — he has still scored a direct win with the bio relevations.

So far, though, Loeb has not sunk Yahoo’s battleship, so it is unlikely the board will acquiesce to his latest demand of Thompson being fired by noon on Monday.

Maybe it will eventually, or maybe it will just scold Thompson or maybe it will do nothing at all.

All that is an unknown — a riddle, wrapped in a mystery, inside an enigma, with a lot of managerial incompetence thrown in. And that, most of all, is the sad definition of today’s Yahoo.

How Did a Phantom CS Degree Get on CEO's Bio in SEC Filings? Yahoo's Not Saying.

Kara Swisher — Thu, 03 May 2012 23:08:24 +0000

Back in early 2008 when Scott Thompson got the job as president of eBay’s PayPal, the regulatory filing accurately listed his educational pedigree:

“Mr. Thompson holds a B.S. degree in Accounting from Stonehill College.”

The eBay filings over the next several years — until he left the online commerce giant for a much bigger job as CEO of Yahoo in January of this year — remained consistent.

But, curiously, Thompson’s bio on eBay’s Web site added an additional degree to his curriculum vitae for more than a half-dozen years, different from its Securities and Exchange Commission documents:

“Scott received a bachelor’s in accounting and computer science from Stonehill College.”

As it turned out, according to the Boston-area school, he had not gotten a computer science degree at all and graduated with the Bachelor’s of Science in Business Administration (Accounting).

An eBay spokesman I called today had no explanation for the discrepancy, except to note that its legal filings were correct and that it was an error due to the lack of cross-checking the Web bio, which was apparently posted by Thompson’s staff at the time.

Also without explanation — and perhaps more seriously — is that the false computer science degree claim somehow then made it into Yahoo’s SEC filings, as well as his Web site bio, when Thompson took the helm. (The inaccurate line about his schooling is in its latest filing and all others.)

Without providing further explanation of how it got there, Yahoo today called the mistake an “inadvertent error” and said it had no bearing on his ability to lead the Silicon Valley Internet giant.

But the long troubled company might be speaking too soon, given that the revelation was uncovered this morning by activist shareholder Dan Loeb of Third Point. Loeb has called into question the vetting process that Yahoo’s directors did to hire Thompson, as part of a proxy fight he is waging to gain several board seats.

And, while such an allegation is normal for an increasingly nasty battle, Loeb has hit his mark with deadly accuracy this time, putting into question both Thompson’s credibility and Yahoo’s obvious botching in its vetting of him.

“If there is a good explanation for the apparent discrepancies regarding the academic records of Mr. Thompson and Ms. Hart, we are confident that it will be provided promptly,” wrote Loeb in a letter to Yahoo’s board today. “However, in the event that there is no good explanation, we expect the Board to take immediate action.”

The Ms. Hart that Loeb was referring to is Patti Hart, the board member who ran Yahoo’s process for hiring a new CEO after it fired Carol Bartz — who does have a CS degree — last year. (In his letter today, Loeb also correctly called into question how she portrayed her own college degree in a more impressive fashion than was accurate.)

The search for a new Yahoo CEO was conducted by headhunter Heidrick & Struggles, which did not have Thompson on its list of candidates, since it had placed him at eBay many years before.

In fact, according to numerous sources, without involvement by Heidrick, it was Thompson who cold-emailed key Yahoo board members, nominating himself for the CEO job. He was quickly brought in for interviews and, presumably, a thorough vetting.

Despite that and despite the fact that eBay’s SEC filings did not list a computer science degree, Hart or others seem to have totally missed the discrepancies and it was added to Thompson’s official Yahoo bio and legal filings.

It’s not clear what happens next or if there are any legal implications, beyond a needed correction by Yahoo with the SEC — which already took the entire line about Thompson’s education off his Web bio today.

Yahoo’s not talking either, with its spokesperson declining to provide any explanation for its lapse or who had maintained that Thompson had that degree when he did not.

It’s essentially a mistakes-were-made-let’s-move-on defense.

I think not, for my part, and a number of prominent Silicon Valley people I spoke to today agreed that these issues tend to spin out of control.

“This is going to get very messy, very quickly,” said one person in a common sentiment I heard.

Maybe, and it’s not clear if the company has to release any details of how this occurred or if its board needs to investigate the situation.

In addition, Thompson himself is probably not at risk unless it can be definitely proved he was the one who misrepresented having the degree in the first place. He can simply say he had no idea who added it to the eBay Web site and that he did not notice it there on on the Yahoo Web site and SEC filings.

While that makes him look careless, how big a deal it becomes with shareholders, as well as Yahoo employees, is also an unknown. While a computer science degree is not a requirement for a CEO of a tech company — both Facebook’s Mark Zuckerberg and Microsoft’s Bill Gates dropped out of college and did pretty well in computer science anyway — tech resume padding, even inadvertent, is not a characteristic that is going endear Thompson to anyone.

Plus, it just handed Loeb a very potent weapon in his fight against Yahoo, the very day after the company said the hedge fund manager’s expertise was not “relevant” to gaining a board seat.

One thing’s for sure: Loeb is most certainly very good at vetting.

She's Baaaack: Carol Bartz Opines at WSJ Women's Conference

Lauren Goode — Wed, 02 May 2012 04:43:45 +0000

Former Yahoo CEO Carol Bartz provided plenty of color for writers and bloggers during her tenure at the company, but during an interview session at The Wall Street Journal’s Women in the Economy Conference in Palm Beach this morning, she took a decidedly reflective — albeit still candid — tone.

WSJ Deputy Managing Editor Alan Murray asked Bartz about the earlier stages of her career, before turning the talk to Yahoo.

A video clip is below, but here are some key quotes:

On her time at Yahoo:

“Turnarounds take a long time, and that kind of turnaround — and when I say that kind, you have an integrated culture and we were trying to change it. And the thing is that anyone that’s running a company that is so attractive to the media — our life was in a glass house.”

On the Yahoo board:

“You have a lot of people helping you with what you should do. That’s what boards get to do. They get to hire and fire CEOs. And now I get to be a big girl and say, ‘I don’t think you should have done that, but …’”

On calling the Yahoo board members “doofuses” after they fired her:

“Do you know what that means? Clueless. That’s all it means, clueless. It’s just a nice word.”

On her penchant for cursing:

Bartz said if she could change things about her experience at Yahoo, she might have cussed less.

“You did say the F-word a lot,” Murray said.

“And Jack Welch didn’t?” Bartz shot back.

“The three things that, every time they said my name, they said, ‘Carol Bartz, 60,’” she added, referencing her age. “‘Carol Bartz, 60’ and ‘salty mouth.’ Somehow, these things just got attached to me …”

On life in the new-media fishbowl:

Bartz said that when she spoke, her employees were tweeting and video-recording her every move.

“The way you manage your company and the way you manage your people has to be totally different,” she noted.

On taking cues from Apple::

“The most successful company in Silicon Valley is Apple, and they’re the most secretive. Think about that.”

Bartz, of course, wasn’t completely curse-free during the session, saying that part of her motivation in becoming a CEO was that she “could actually impart my values if I was CEO. And I wouldn’t have to work with —holes any more.”

And during an audience Q&A yesterday evening, following the conference’s kick-off interview with General Motors CEO Dan Akerson, Bartz stood up and told Akerson, along with the rest of the crowd, that she didn’t believe enough women supported other women in business.

“There are so few positions for women available that they have to be über-competitive,” Bartz stated.

When I later ask Bartz what her thoughts were on new Yahoo CEO Scott Thompson’s performance so far, she replied: “No comment,” after saying she still “loves” Yahoo.

“I miss it,” Bartz said.

Here’s the video of Bartz being interviewed:

[ See post to watch video ]

New Yahoo Chief of Staff Comes In, While Previous One Goes to Facebook

Kara Swisher — Sun, 15 Apr 2012 08:45:59 +0000

New Yahoo CEO Scott Thompson has selected Marta Nichols, who was the Silicon Valley Internet giant’s VP of investor relations, as his new chief of staff. Interestingly, Joel Jones, the chief of staff under Thompson’s predecessor, has moved to Facebook. After CEO Carol Bartz was ousted in the fall, Jones moved to a job as VP of Americas Ad Marketplaces at Yahoo, but he’ll now be part of the business operations team focused on the advertising business at the social networking giant.

Carol Bartz Gives Some Straight-Talkin' Advice

Kara Swisher — Thu, 12 Apr 2012 19:00:00 +0000

Today, Bloomberg Businessweek is releasing its second “How To” issue, in which the magazine asked over 60 well-known people how to handle “real world problems big and small … from how to make coffee at home to how to save Greece, and even tell readers how to buy a supertanker and a dinosaur.”

Okey doke!

My favorite is one from Carol Bartz, titled “How to Speak Your Mind,” which made me dearly miss the mind-speaking stylings of the ousted Yahoo CEO. Well known for her ability to toss off a curse like it was breathing, she knows of what she speaks.

“Agreeing is easy,” she says. “Disagreeing takes more guts.”

Word. (That’s her above giving me the business at our seventh D: All Things Digital conference in 2009.

Here’s her priceless advice on the subject:

Exclusive: Yahoo's Chief Product Officer Blake Irving Resigns

Kara Swisher — Fri, 06 Apr 2012 01:28:26 +0000

According to sources close to the situation, Yahoo’s Chief Product Officer Blake Irving has turned in his resignation and it has been accepted by the company.

The process for Irving’s departure is a bit more formal since he is a top officer at the Silicon Valley Internet giant. But it is perhaps not that surprising, given that a brunt of the 2,000 employee layoffs at Yahoo yesterday were in his part of the organization.

Irving has not been at Yahoo this week during those wrenching cuts — that’s because the resignation has been in the works for some time.

In fact, in a restructuring to be announced next week, the central product organization at Yahoo he runs was essentially blown up, with the development moving back into media, sales and consumer products units being planned.

In addition, Yahoo’s new CEO Scott Thompson has been contemplating selling off large parts of the company’s advertising technology platforms, as well as its search business, also now under Irving.

Irving had largely opposed the strategy that Thompson has been aiming toward, said sources, and also strongly disagreed with laying off so many employees without a clear plan in place. Many inside and outside Yahoo agree.

He was also apparently concerned about the massive engineering and research talent exodus of late, especially in Yahoo’s vaunted Labs arm, which suffered major cuts in the layoffs.

The former Microsoft exec has no plans for another job, said sources, but has had a number of offers.

Yahoo confirmed the resignation when I called to ask about Irving’s goodbye. “Yahoo wishes him all the success in the future,” said the spokesperson.

Irving came to Yahoo in mid-2010 under former CEO Carol Bartz, who was fired last fall. Under his leadership, the product unit had focused a lot on creating a major publishing platform for Yahoo and other media companies. He debuted its Livestand content app earlier this year.

Here is a video interview I did with Irving in happier times, talking about Yahoo products, in which he sported a very handsome blue cashmere sweater:

[ See post to watch video ]

Exclusive: Yahoo Labs Head Raghavan Departing to Google

Kara Swisher — Sun, 04 Mar 2012 21:40:27 +0000

Prabhakar Raghavan, the well-respected head of Yahoo’s Labs unit and also recently its head of strategy, is leaving the company to take a job at Google.

The departure comes ahead of what will be very deep cuts in his division, which is in charge of long-term research at the Silicon Valley Internet giant, said sources, and is spread all over the country. More researchers at Yahoo — which is a very well-respected group — are also expected to go too and will be the subject of fervent recruiting interest by companies such as Google and Facebook.

Yahoo confirmed the move after I made an inquiry about it this morning.

In a statement, the company said:

“Yahoo! thanks Prabhakar Raghavan for his dedication and contributions to Yahoo! for the past 7 years. We wish him well in his next endeavor. Ash Munshi, CTO, will assume leadership for Y! Labs.”

It is unclear what Raghavan’s new role at Google is.

But, as head of Yahoo Labs, Raghavan’s research arena has been extensive, encompassing everything from data mining to algorithms to search.

He is also a consulting professor of computer science at Stanford University. According to his bio, Raghavan has “co-authored two textbooks, on randomized algorithms and on information retrieval.”

The Berkeley PhD had been CTO at Verity and had held a number of jobs at IBM Research.

More to the point, he was very well respected within the company, which seems to be curtailing its commitment to research as it attempts to turn itself around under the new leadership of CEO Scott Thompson.

Raghavan had been made head of strategy under former CEO Carol Bartz, who was fired.

He has been at Yahoo seven years.

Yahoo May Not Need a "Loebotomy," But It Definitely Can't Endure a Brain-Sapping Proxy Fight

Kara Swisher — Fri, 17 Feb 2012 18:35:46 +0000

Let’s put this in the simplest terms: Yahoo cannot spend the next half year in any kind of testy proxy battle with activist shareholder Daniel Loeb.

Not shouldn’t. Can’t.

Having closely covered the last goat rodeo in 2008 with corporate troublemaker Carl Icahn — which ended in big shareholders dinging the board badly and the controversial activist joining it — I can say definitively that the experience damaged the Silicon Valley Internet company in ways that are still resonating.

Angry shareholders (whose anti-Yahoo votes were initially miscounted in a stunning bumble), distracted management, media story after story about the fight, it eventually led to the departure of then CEO Jerry Yang by the holidays of that year, a rejiggered board and a new CEO, Carol Bartz, and fervent promises of change and turnaround.

Fast forward to today: Bartz was ousted in the fall of last year, a newish board is coming in, there’s another new CEO and, of course, more fervent promises of change and turnaround.

This is like the movie “Groundhog Day,” except not nearly as funny.

Speaking of funny, a Heard on the Street in The Wall Street Journal yesterday actually went fabulously snarktastic with its headline on Yahoo’s current tussle with Loeb of Third Point: “Is Yahoo Ready for a Loebotomy?”

Heh.

Opening with the line, “How many activists does it take to screw in Yahoo’s light bulb?,” the piece went on to ponder back and forth the impact of Loeb on the already dicey situation at Yahoo.

It concluded: “Yahoo investors shouldn’t expect a quick fix whoever the directors are. But, given how long Yahoo has been struggling to gain traction on its own, having a champion of shareholder value on the board can’t hurt.”

Nope, it can’t, as long as said investor wants to help find the successful fix previous Yahoo leaders have been heretofore unable to.

Another commentary in the Journal, “Dealpolitik: The Yahoo Paradox” took an opposite tack.

“Even giving Mr. Loeb a single seat could further weaken Yahoo. As a gadfly Mr. Loeb could challenge each board decision,” it read.

Actually, given this board changes direction more often than Republican presidential candidate Mitt Romney — witness the now non-talks with its Asian partners this past week and, before that, with private equity investors — I am not sure Loeb would change the status quo all that much if he threw one tantrum per meeting.

So, which is it? Will a settlement with Loeb lead to more trouble or will it create the kind of change that Yahoo has long needed and never gotten?

At this point, I have no idea — but I do know that a fight between Loeb and Yahoo is good for no one, except lawyers and perhaps page views on this site and others.

And, frankly, I don’t want them.

That’s because — even as the rest of Silicon Valley reinvents and innovates more aggressively than ever these days — Yahoo and its still deeply committed employees will be caught up in more fraught financial mishegas and machinations and will be unable to do anything to attract new talent and begin to truly fix itself and its products in the profound ways it needs to.

And new CEO Scott Thompson — who seems intent on setting a new course for Yahoo in a non-advertising arena — will be inevitably distracted, no matter the also inevitable protestations that he will not be.

And, it won’t just be Loeb who is hovering — there is no doubt a panoply of other interested outside investors still waiting in the wings to see what tasty bits of Yahoo might come available if the crisis deepens.

It’s certainly not come to roadkill yet by any measure. But it’s not a recipe for hitting the ground running, either.

Here is a video of me talking about the problematic situation on WSJ.com’s “Digits” online show:

New Yahoo CEO Scott Thompson Has Big Plans, but Can't Tell You About Them

Peter Kafka — Tue, 24 Jan 2012 23:11:34 +0000

You want news out of Scott Thompson? Then you’d be very disappointed with the Yahoo CEO today. Not surprisingly, the new boss — who wants us to remember that he’s really only officially been at work for two weeks — says it’s too early to talk about his plans.

But he does have some, he insists. For instance:

He has a plan to fix Yahoo’s big mess in Asia.
And he has a plan to help fix ad sales, which have been in turnaround for nine months and are still declining.
And he has a plan to buy some stuff to “fill in technology gaps” that will help with all of that.

But no details on any of that during the Q4 earnings call. Instead, Thompson repeated what he told Yahoo employees during his first address to them — Yahoo is both a media and technology company, and people should get their heads around that — and he laid out some big, pretty obvious ideas:

It’s important to pay attention to users and advertisers.
Yahoo should move fast, etc.
He’s going to double down on some existing Yahoo projects, and cut others.

Got it? Good. More details to come, Thompson says. And yes, for the record: That is a serious Massachusetts accent on the new guy.

—————–

EARLIER

Earlier this month, Yahoo CEO Scott Thompson got on the phone with Wall Street analysts, and refused to discuss the company or his plans for it in much detail.

Fair enough: He had just been hired that morning, and had barely met anyone in the company.

So now it’s been nearly three weeks. Think he’ll offer much more in the way specifics, in the wake of the company’s Q4 earnings report?

Me, neither. But Wall Street will still be hungry for any scraps it can get, whether it’s an update on the company’s Asia mess, a hint about future cost-cutting moves, or a general “here’s what I think we should be doing” state-of-the-state.

We will definitely get a chance to hear the Boston accent that seemed to charm everyone so much in early January. Time to see if it’s still as effective.

4:58 pm: Greetings! Just doing some finger exercises in advance of the call. Also looking for some Kara Swisher aviator glasses, since La Swish is in transit and cannot cover the call herself. I’d say I’ll do my best to channel her as I type, but I don’t think I could handle that.

5:00 pm: There’s time for a quick ticker check: Investors still yawning, and YHOO shares are nearly flat, after-hours. But Apple!

5:01 pm: And we’re off. On the call: Thompson and CFO Tim Morse.

5:03 pm: Thompson: Even though I’ve been here for three weeks, my official start date was only two weeks ago. Still! I had strong opinions before I arrived, and since then, I’ve been looking around: Big opportunity here.

Powerful brand, lots of visitors: 702 million globally! Advertisers like us, etc. “We’re going to work not just at scale, but with speed.” “I feel great about that, but I’m still very clear that we have a lot of work to do.”

You want details? Won’t give ’em. But I’ll talk about guiding principles:

For me, I insist “that we be balanced.” Have to think about customers, who we are, [something I missed] and how we allocate capital. I’ll come back to this in a bit.

And before we get to any of that, let’s talk about Q4 numbers and 2012 projections.

[At this point you can consult the numbers they've already put out]

Let me praise some people. And, “there’s no question” that we can do better. “And we will.” Need to get to market faster, monetize better.

5:07 pm: Here’s Tim Morse, with some numbers. [Again, you can read most of this, so I'll skip most until he gets to the "color" part.]

Challenging quarter, but I’m proud of the team. Etc.

And now, some 2011 numbers. [Again, I'll also skip this stuff.]

[Meanwhile, here's Citigroup analyst Mark Mahaney's take, fresh off the grill: "Fundamental trends remain nothing to email home about. The Display Advertising results were a clear negative, and the Search Advertising results continue to remain murky. Stock buybacks are (almost) always good … Scott Thompson has his work cut out for him …"]

Some details on our display missed. We missed by $15m; $10m of that is from Europe and macroeconomic stuff.

We’re nine months into salesforce revamp. We’re doing pretty good with that. “Several major advertisers” that had bailed or cut back on Yahoo spend have made “meaningful commitments for 2012.”

Some search notes. A reminder that we extended Microsoft search deal through 2013.

We’ll get to 2012 guidance in a minute. But first, a reminder that we’re still growing visitors and page views. More of that to come. U.S. elections and Olympics will be big for us.

“In short, we’ve made progress on many fronts, but that’s not the whole story.” Revenue isn’t growing, and “we expected better.”

5:18 pm: Guidance numbers, which you can also get from the release. But they are “not reflective” of our long-term goals. Because we want to grow.

And margins will get better, too.

And yes, we’re talking about fixing our Asia mess. But we won’t be able to go into details about that on this call.

5:21 pm: Back to Thompson. Okay. So here’s more on that “balance” stuff.

First: Customers. Both our users and our advertisers — we want them both to get real value from us, “and we will focus equally on both.”

We have to get people to use us more frequently. And we need advertisers to know we like them, we really like them.

5:22 pm: Two: “Balance in who we are.” We’re a media company and a tech company. We need to be great about both. “So we end the debate about which is more important … we must do both. End of discussion.”

Three: We gotta grow fast. “When it comes to making decisions, I make them quickly, and then push to move fast, fast, fast.”

Four: We gotta balance investment resources for today, tomorrow and long-term. Right allocation of capital is very important. Most resources have to go to “current core business.” But a lot also has to go to the products of tomorrow and the next 12 months. And also a “small but meaningful” amount into products that won’t show up for a year or more. We need a vibrant long-term product pipeline, and we have to consider businesses that don’t look anything like what we’re doing today.

But need to be very clear — not about restarting investment cycle. Refocusing, which means there are some things that we’re going to stop doing [that is, we'll have shutdowns and cuts].

I have some very clear ideas about the specifics of what we’ll do. But I won’t tell you about them.

Still, some big ideas: Customer experiences, and data.

5:26 pm: On customer experience: 702 million users a month. Did I mention that? Yes, I did. I’ll say it again. “But the sheer numbers of users will not get us to where we need to be.” We have to improve their experience while they’re here: Better interfaces, faster speed, deeper and “much more relevant content.”

And we need advertisers to get better results, and spend more money with Yahoo. [Don't do the opposite!]

On to data: We can use data to make the experience better for users — tweak layout, content, flow of the page and advertisers. “Nobody has done that yet on the Web.” “I know lots of companies talk about using data.” But we mean it. Crucial for you to understand that data is core to our plans. It “will be the key component for driving innovation at Yahoo.”

5:30 pm: So there’s some insight for you. Now on to strategic-review update. Roy said on last call that BOD considered a lot of alternatives. “It’s important for you to know that the company remains open to anything that’s good for our shareholders.” but we’re “focusing on what appears most promising.” “The work is ongoing, and I won’t say more about that today,” but it’s going to be good for shareholders.

Here’s the takeaway: There’s plenty of opportunity here. “Much bigger than the outside world imagines for us today.”

I’m here because we can do more.

5:32 pm: Alrighty. Q&A time.

Q: Please talk about that Interclick deal. What will they contribute in revenue and earnings? Also, update on revenue per search, please.

Morse: $25M of cost in Q1 from ICLK. $10M in revenue. We expect revenue to ramp throughout the year. As far as RPS increase, Microsoft is doing a nice job, and so are our sales guys.

“We’re definitely closing the gap” when it comes to search. But a reminder that we have a guarantee though March 2013.

Q: On that balance thing: How important will Q&A be here? Big deals in the works? Also, what do you see in macro environment?

Thompson: I think there’s going to be some stuff that we need that we don’t have, and so we’ll probably have to be “aggressive” in the market. “I’m relatively certain that there will be things that interest us” to help us “fill in technology gaps.”

Morse: Europe wasn’t great last quarter, and early indications are the same now. Not expecting much change this quarter, anywhere.

Q: How about a dividend? Also, how do your big principles play into display ad turnaround?

Thompson: “Too early” to imagine dividends. On turning around display: I’ve tried to spend a lot of time trying to figure out our problems there. “We are after that with a very high sense of urgency.” Number-one priority for now.

Q: Also on display. Any sacred cows going forward? Also, on premium video — how are your original series performing?

Thompson: Not sure how to interpret that cow question. “We are understanding and evaluating all options … personally, I’m being very aggressive.”

Morse: Last month, we had nine out of the top 10 original shows in U.S. We don’t give out revenue and pageview and streaming numbers, but “assume healthy growth there.” But more work to be done.

Q: Tim: Please give us more detail on premium display pricing. Scott: You guys made a lot of buzz with that Tom Hanks show announcement. Please discuss economics. Also: Experiment, or prelude to more?

Morse: Like I said, premium display below where we wanted, but it was in the range. And Interclick will make that better.

Thompson: Yeah, that was great buzz at CES. “It was more than the event itself,” everyone had nice things to say. “I was pleasantly surprised.” Not going to share details on dollars. So far, “we’ve had reasonably good success” with the originals we’ve done past.

Q: You talked about doing things Yahoo hasn’t done before. Like what? Also, for Morse: Shouldn’t he be worried about Yahoo’s share on mobile devices?

Thompson: Too early for me talk about strategically what we’re doing.

Morse: On search — yeah, we want to grow our O&O. In terms of mobile share, it’s so early right now. “It’s very intriguing in terms of how we’re going to play.”

But new revenue streams from mobile are even more important than existing ones.

Thompson: Important to point out that “no winner” has shown up yet when it comes to mobility. [Really?]

Thompson: Did I mention data? Let me mention it again. We have tons of it. It’s going to be huge for us. Data and technology can help us predict what users want to do next; it’s a huge advantage for us.

Q: Carol called this a communications company. Terry Semel called it a media company. And you?

Thompson: I had this all-hands meeting, and I said it again today. There’s this long-standing debate here. But “we better be darn good at both. In fact, I think we ought to great.”

Morse: Discussion of financials. Gap between reporter and subject.

Q: You said you’d realign around key areas of focus. But what’s new about that? Are there new verticals? Also, since you’re talking about investing, how does that jibe with operating margin goals?

Thompson: We’re working really hard to evaluate options. “Providing more detail for you today … is just a little bit premature.” “I actually feel a little bit bad” that I can’t tell you more.

“Just a little bit longer, if you will, before we get really specific” on that.

Morse: Yes, we’re going to spend money. But we’re also going to stop those projects, so we can move money around.

Q: On display: Seems like big opportunity to monetize your leftover inventory. Talk about that, please.

Morse: Yep. That’s one reason why we bought Interclick. (Also, theoretically, the reason for this.)

Q: Talk more about Interclick. $10m revenue, $25M costs. But that doesn’t look like what they were doing before you bought them — they had $2M EBITDA per quarter. What’s going on?

Morse: A lot of what they were doing before was related to Yahoo, so we have to eliminate some of that for reporting. Also, we’re building out so we can do more with that. Also, we have to start amortizing intangibles. Also! “This is the first quarter, right out the gate.”

Q: For Scott: You talked about growth before. Can you talk about growth via acquisition, and new business versus growth of existing business? Also, please talk about mobile traffic.

Thompson: I’ve talked to customers. “The conversations were fascinating.” People want us to grow. They also told us “exactly what we have to do to get more of their spend, today.” We can do that. We don’t have to grow solely via M&A. “The really good news is, the customers are there, they’re cheering for us.”

As far as mobile, I haven’t really seen the data. But I’m sure it’s growing really fast. It did at the last business I was at.

Morse: Right.

That’s it, everyone. All done for today.

Yahoo's Q4 Limps In Close To Wall Street's Expectations

Peter Kafka — Tue, 24 Jan 2012 21:07:13 +0000

First look at Yahoo Q4 earnings: Earnings of $0.24 a share on revenues of $1.17 billion. Wall Street was looking for $0.23 and $1.19 billion.

For a look at what investors had been expecting, consult Kara Swisher’s preview from last night. Short version: Not a lot, which is why the CEO spot is now filled by Scott Thompson instead of Carol Bartz.

A few details:

Display revenue is down four percent, which isn’t a huge shock since Yahoo U.S. boss Ross Levinsohn is trying to rebuild the company’s sales force. Plus, he is making some structural changes along the way that might cost it a few sales dollars in the short term, at the very least. But still, it’s worth remembering that for just about everyone on the Web, with the possible exception of AOL, Web advertising is growth business.

Yahoo would also like you to know that its worldwide traffic was up 12 percent, and that page views for its media properties were up seven percent. That’s a good thing, because the core of Yahoo’s pitch to investors and advertisers is “we’re still really, really big, and that’s important.” So if it was shrinking that would be bad.

But unless Yahoo posted some very unusual numbers this afternoon, this report wouldn’t be crucial for Thompson — which is why shares are basically flat in after-hours trading.

Much more interesting will be his first earnings call, where he’ll have the chance to give people his first impressions of his new company: Just how bad are things? Or, if you want to be more positive: How long will it take to turn things around?

I’ll cover that call at 2 pm PT; head here for live coverage.

As Weak Q4 Earnings Loom, Yahoo Freezes Hiring and Also Contemplates Layoffs

Kara Swisher — Thu, 19 Jan 2012 13:10:51 +0000

According to sources close to the situation, Yahoo has instituted a hiring freeze across the company and is considering a reduction in force in support units of the company.

While the details of any layoffs — which are expected to be small and selective for now — are still being worked out, sources said that the stricture not to fill hundreds of open positions is the first step toward significant cost-cutting initiatives across the Silicon Valley Internet giant, in the wake of what it expects to be another weak quarterly report next week and a looming proxy fight.

Yahoo reports its fourth quarter earnings Tuesday. While the company has managed to improve the results in the last part of the quarter, sources said they will still show continued weakness in its key businesses and consumer usage.

That’s as competitors such as Google and Facebook have been showing significant growth, especially in the display advertising market.

Thus, new Yahoo CEO Scott Thompson appears to be zeroing in on costs and managing for margins, said multiple sources, much as his predecessor Carol Bartz did at the start of her tenure.

But many think Yahoo needs even more drastic changes, including massive cuts in staff and also product arenas, to give the company new life.

That includes shifts in leadership at the top levels too. In a major move this week, co-founder Jerry Yang stepped down from the company’s board and all roles there. More directors are expected to leave soon, too.

That will likely come after negotiations to sell part of its lucrative stakes in both the Alibaba Group and Yahoo Japan are successfully completed.

While not a certainty, Yahoo’s board hopes that will happen sometime before activist shareholder Daniel Loeb initiates a proxy battle against the company in the coming month.

Sound complex?

It is, and also troubling to Yahoo’s long beleaguered rank and file, who have been worried about more layoffs.

The Yahoo troops have been under intense pressure and have suffered from ongoing attrition. Just yesterday, for example, Yahoo lost one of its top advertising execs, Seth Dallaire, to Amazon.

The company can ill afford such departures of key talent, even as it seeks to pare employee numbers in other parts of its business.

At the end of its last quarter, Yahoo reported that it had 13,700 staffers, down from 14,100 in the previous year.

Yahoo, of course, declined comment.

Liveblogging the New Yahoo CEO Call: You Might Want to Refrain From Cussing, Scott!

Kara Swisher — Wed, 04 Jan 2012 15:01:23 +0000

This morning, Yahoo said it had hired PayPal President Scott Thompson as its newest victim, oops, CEO.

(You can read my interview with him too, here.)

AllThingsD.com had reported the pending development last night — which is how we roll here.

Now we will roll into the conference call on the matter, and are hoping that the head of the lucrative eBay payments unit will make an appearance, given that he does not start until next week.

One piece of advice I will extend Thompson: I would refrain from cursing, as previous Yahoo CEO Carol Bartz did on her first outing. (She was fired in September, although not precisely for the cussing she so enjoyed partaking in.)

Here we go!

7:02 am: It’s on, with Thompson present.

Yahoo Chairman Roy Bostock begins, and he is “very excited, very excited.”

I’d be very excited if Thompson talked and not Roy, who has been to this particular Yahoo CEO rodeo a few too many times before.

Bostock is making promises that this time it’s going to be different. Really!

He also notes that the company will continue its “strategic review” — but who knows what that means now.

And he thanks Tim Morse, the interim CEO who is moving back to the CFO job. (Agreed — nice work, Tim!)

7:06 am: Scott Thompson is on and is “just thrilled” to be the new Yahoo CEO.

I like his accent, which seems like he might be from Boston. He does look and sound like Cliff Clavin, the mailman guy at the Beantown bar from the television classic “Cheers.”

Except, given he has been the darkest of dark horses in this CEO race, nobody knew Thompson’s name.

Thompson is saying all the right stuff, about wanting to increase shareholder value and such.

He sounds so hopeful! Urgency! Thoughtfulness! A bright new morning at Yahoo!

I have been to this rodeo before too, but I am still hoping this time it’ll work.

Scott, if you let me down, I might cry, because you sound so nice.

7:09 am Q&A time already.

Congrats from the Wall Street analyst peanut gallery.

Then, it’s right into a question for Bostock, about the progress of the Asian assets deal.

Also, is Thompson too much of a technologist and not a media dude?

Bostock wants to talk about only Scott, but notes that there will be “no slowdown and no delay” in the Asian process. And Thompson will be all onboard when he comes on board, folks.

Bostock sounds tired, but starts to talk about how a “great customer experience” is the key to the advertising business. He notes that Thompson knows how to do this, hence he’ll be fantastic.

“I have every expectation he’ll be out there calling on advertisers,” says Bostock. I would hope so, given that is where Yahoo makes most of its lettuce.

Bostock is saying Yahoo has been “treading water” and now needs to swim fast. Treading water? I wonder who the top honcho at Yahoo has been while the company has been listlessly dangling its legs in the drink?

Roy — that’s who!

7:15 am: Another analyst asks about margins.

Thompson is not having any of it! He is polite when asking for time to get on the job to make proper statements.

But he does focus on the need to build “great, innovative” products. True, but Yahoo has been incredibly unable to do this of late.

Thompson gives no specifics, though. My big idea: I would steal the self-driving car from Google.

7:17 am: A question about what the core of Yahoo is, and about what lessons Thompson is bringing from his experience at PayPal.

Well, he has not met the team — literally. Yahoo’s board consulted almost no one in the top ranks of execs on this appointment.

But Thompson “suspects” there is talent there. Given the recent attrition, he’ll need a big Inspector Clouseau magnifying glass to find it!

From eBay’s PayPal, he says that the key was balancing the customer experience with network effect and, well, blah, blah, blah Internet-speak.

I am still thinking shoplifting the self-driving car is the bestest idea.

7:20 am: A question about Yahoo’s display business versus Google.

Thompson notes it is too early for him to say — though he had better say soon! — but notes that data is key. He is a well-known by-the-numbers guy, and that is clearly where we are going at Yahoo, now that he is the big dog.

Thus:

“The data these Internet businesses create, the ability to use analytical technology to build a better businesses for your customers … I feel certain that wealth of data is going to be exploitable for next generation products, next generation experiences … My instinct says down in that data we’re going to be able to find ways to compete and innovate that the world hasn’t seen yet.”

I am really liking this accent, which is almost lulling. And so polite! Sources tell me that being “collaborative” was a big goal in this hiring.

7:22 am: A question about the identity of Yahoo, and whether it should be public or private.

Thompson harps on the need for innovation, and hopes it will be the future.

“I would not be here if I didn’t think it was possible,” says Thompson.

Bostock takes the public/private question. Yahoo will be public, he declares! Mostly, because it would be too pricey to take private.

“It’s a moot point,” he says.

7:25 am: More questions about what Yahoo is.

Thompson declines to run off the rails on this dicey one, but he says he believes that Yahoo has great assets.

It does. It’s just that it has been crashed many times — by the people who just hired him — right into a wall.

Just sayin’ — a self-driving car would have done a better job.

7:27 am: A brain-drain question, and more on Asia and on mobile.

Bostock butts in again. He said that Thompson will not be distracted by that, and will concentrate on the core business. Hush up, Roy.

Thompson says that he looks forward to meeting the peeps of Yahoo. (’Cuz he has not, as yet!)

He also loves mobile — which Yahoo has largely borked.

7:32 am: A content strategy question. Early days, so Thompson is still keeping his yap shut.

In this, he’s like the anti-Bartz. Is this good? It’s certainly different.

He says again that, “I can’t wait to meet” everyone at Yahoo. Vice versa, because this dude came from left field.

Thompson promises that he will be a “sponge.”

He closes by noting that he is “genuinely excited,” and says he believes in Yahoo.

Indeed, when it comes to Yahoo, you definitely gotta have faith.

Confirmed: Yahoo Names PayPal Head Scott Thompson as New CEO

Kara Swisher — Wed, 04 Jan 2012 14:08:53 +0000

As I reported late last night, Yahoo said it had named PayPal President Scott Thompson as its new CEO. The exec is currently in charge of the large eBay online payments unit.

He’ll start next week, but there are staff conference calls today and also an all-hands meeting on Yahoo’s main Silicon Valley campus (meet at URLs, troops!) tomorrow.

Yahoo shares are down almost three percent on the news so far, as Wall Street has been hoping for a big sale of some sort and not another turnaround.

Yahoo will be holding a 7 am PT press conference about the move and presumably to swan around Thompson.

(Welcome, Scott! I hope you were informed — please do not listen to what co-founder Jerry Yang says on this important issue — that you are supposed to send all internal memos to me! Also, as one of my Twitter followers, Mike Dudas of Google just tweeted: “If Thompson leads companies as well as he grows a moustache, Yahoo made a great CEO choice!!” I concur.)

A Yahoo PR person confirmed the hire very cordially in a phone call early this morning and the Internet giant also put out a press release.

So did I, of a sort, last night. Given I am too tired to rewrite myself, here is what I had reported:

Again, Scott, thanks for the Facebook tip — I knew the social networking site could come in handy!

(Also, here is an interview I did with him post-announcement.)

And here is Yahoo’s official press release where Yahoo Chairman Roy Bostock says nice stuff about Thompson:

YHOO_News_2012_1_4_General

Exclusive: Yahoo Poised to Name CEO -- With eBay's PayPal Prez as Top Choice

Kara Swisher — Wed, 04 Jan 2012 07:29:18 +0000

According to sources close to the situation, Yahoo is poised to name a CEO, an announcement that could come as early as tomorrow.

Sources said the leading candidate likely to get the nod is a dark horse and someone who has not been named in previous reports (and not on my suggested lists!): PayPal President Scott Thompson, who runs eBay’s massive online payments unit.

While the situation could certainly change, the Yahoo board has definitely been moving aggressively of late to try to find a new leader for the Silicon Valley Internet giant.

The company fired its last CEO, Carol Bartz, in September; Yahoo has been run by the board and also by interim CEO Tim Morse, who had previously been its CFO.

After Bartz’s ouster, Yahoo said it was looking at a range of strategic options, including the possible sale of all or part of the company.

That was the focus at first, although Yahoo had simultaneously hired Heidrick & Struggles to look for a new CEO.

The company attracted two partial investment bids from private equity firms, Silver Lake and TPG Capital, but shareholders were unhappy with the low prices of these so-called PIPE — Private Investment in Public Equity — arrangements.

Yahoo then moved to try to strike a tax-advantaged deal with its long-disgruntled Asian partners, China’s Alibaba Group and Japan’s SoftBank, to sell back parts of the large stakes it has long owned in Alibaba and Yahoo! Japan.

Those complex negotiations are still ongoing and look promising, which could yield Yahoo billions of dollars in capital to be given to investors, for stock buybacks or to invest in new initiatives.

Since then, the board — long considered one of the more cloddish in tech — has turned its attention to hiring a new CEO, in the hopes of trying once again to revive its flagging fortunes.

Thus, it began looking to hire someone with deep tech experience at a large public consumer Internet company in Silicon Valley.

That narrowed the field, with Yahoo looking at a range of choices with expertise in advertising, technology platforms and more.

There is a lot of that on the deep bench that eBay CEO John Donahoe has assembled at the online commerce giant, including Thompson.

Plus, he is a genuine Internet geek.

According to his eBay bio, Thompson became president of PayPal in early 2008, after serving as its CTO in charge of information technology, product development and architecture.

Before eBay, he worked at Inovant, a subsidiary of Visa formed to oversee global technology for the organization. He was also CIO of Barclays Global Investors and has worked at Coopers and Lybrand on information technology.

And here’s a tasty new wrinkle: Thompson recently “liked” Yahoo on his Facebook page, along with the decidedly more interesting Kickstarter and Splunk.

(Dear Scott, Nice to meet you. And thanks for the tip! FYI, it’s a juicy giveaway like that which feeds my insatiable quest to find out All Things Yahoo!)

More to come soon, I expect.

Yahoo, as usual, never got back to me on my query, although the much more cordial people at eBay politely declined to comment.