Today, Yahoo leaders — all of them in two different memos — took to the keyboards to fill their 14,000 employees in on what’s up.

Reading them, Yahoos must now be more confused than ever.

To summarize: Yahoo is for sale, sort of. But we’re taking it slow, because we always like to drag out the uncertainty here at Sunnyvale HQ. Hey, keep working hard and innovating, despite the still-matrixed system. But don’t fret that your job and career hang in the balance. And have a good weekend!

In the first email, Yahoo Chairman Roy Bostock and co-founders David Filo and Jerry Yang — also a director — penned a rambling missive, which finally admitted the company was indeed, as was first reported here, for sale.

Yahoo said hired-gun investment advisor, Allen & Co., was “fielding inquiries from multiple parties that have already expressed interest in a number of potential options.”

Not to be a niggler, but didn’t Yang tell the troops at an all-hands meeting recently that Yahoo was not for sale?

Details! Thus, said the memo, until the company sorts out all the offers just pouring in — not so much, but when you’re selling a house, you put on the dog — Yahoos had to keep working hard.

Therefore: “What Yahoo! needs to do better — and we’ve talked about this — is accelerate innovation, reignite inspiration, and give our users what they want now — great content that is engaging and easy-to-use on any device and provides an experience in which they can participate and contribute. Perhaps most importantly, we need to anticipate what they will want next.”

You’ve. Talked. About. This. You mean to try to make cool stuff like every other tech company — Apple, Facebook, Google — already does? Mind-blowing.

After a little throat-clearing on its fake search for a new permanent CEO and some media-bashing (yes, this all my fault!), the memo noted that all this fancy strategery is going to take “months, not weeks.”

(Is it just me or does it feel as though former CEO Carol Bartz was fired a badillion years ago, instead of just weeks ago? Plus, I actually believe I officially now miss her kooky-but-genuine Friday staff emails.)

The Gang of Three email was followed by one from the incredible shrinking interim CEO Tim Morse, who said Yahoo was not in “limbo,” due to all this obvious limboness about the strategy.

“That means we will not be sitting still over the next few months,” Morse wrote. “We are actively making decisions and taking action.”

In other words, nothing to see here. Except everything.

Oh, I give up — just read for yourselves:

Dear Yahoos:

In our recent all hands meeting, we talked about the Board’s strategic review to help return the Company to a path of robust growth and industry-leading innovation. While our teams are working to evaluate the many opportunities by which Yahoo! can continue building on our success, all kinds of people have been — and will continue — speculating in the media about where that work is headed, so we thought it best to provide you with some additional context directly from those of us who are closest to it. We don’t have specific news to share with you today, but we are committed to communicating with you directly from time to time — especially given the level of external swirl — so that you know where we are in the process. You can expect periodic updates from us and we encourage you to communicate with us as well.

At the heart of what we are doing is our belief that Yahoo!’s core strengths are not only relevant to where users are going today, but can serve as a foundation for the next phase of our company’s growth. Consider our strengths: we have 680 million users worldwide. We have nine of the #1 properties in the U.S., and we are a leader in display advertising. Our brand is iconic — we are not the only ones who bleed purple. By whatever measure you want to use — engagement, quality of products and services, our value to our advertisers — we all feel that we have what it takes to succeed. Also, our Asia assets remain one of our top priorities and we continue to work well with the teams there. As you may have seen, Alibaba Group has just announced a liquidity event for its employees that reflects a continued appreciation in its value, and therefore of the value of our stake.

What Yahoo! needs to do better — and we’ve talked about this — is accelerate innovation, reignite inspiration, and give our users what they want now — great content that is engaging and easy-to-use on any device and provides an experience in which they can participate and contribute. Perhaps most importantly, we need to anticipate what they will want next. That is the path to enhancing the value of Yahoo! for all of its stakeholders, including its users, customers, shareholders, partners and Yahoos everywhere. Our strategic review is designed to help us map out the best way to achieve that.

At this point, we cannot offer many specifics about the Board’s review; we’ve just gotten started. You should know that the entire Board and management team are fully aligned and unanimous in their views regarding the scope of this work. Allen & Company was a logical choice to help us in this review, because they have been one of our advisers for some time, and this is familiar territory for them. Achieving success in our sector is intrinsic to what they do for a living, and they will be constructive partners.

Our advisers are working with us to develop ideas that we will pursue proactively. At the same time, they are fielding inquiries from multiple parties that have already expressed interest in a number of potential options. We will take the time we need to select and structure the best approach for the company, its shareholders and employees.

In addition, as we announced previously, the Board has commenced a search for a permanent Chief Executive Officer. That process also continues.

When we have updates that we can share we will do so. There will be plenty of rumors and speculation as different parties try to advance their agendas in the media — but it is important that we not be distracted by the rumors and speculation.

You are instrumental to the success of our business — we can’t do it without you. While we will move with a sense of urgency, this process will take time. Months, not weeks. We know that’s a lot of potential distraction, but we believe it will be worth the wait. We are forging a path to a next phase of growth for Yahoo! that feels like our best days: fun, full of possibility, and always in search of how to deliver the new thing people want from us. Together, we can write the next great chapter in the Yahoo! story and secure our place as one of those rarities: an internet company that endures.

Jerry
Roy
David

Yahoos,

I’m sure by now you’ve all seen the note from Jerry, David and Roy. I want you to know that while the Board works through all of our options, CEO Staff and I have been charged to move the company forward.

That means we will not be sitting still over the next few months. We are actively making decisions and taking action.

In fact, for three days this week, CEO staff and I met to do just that. Our planning for 2012 is well underway, and we continue to execute on our current plans — such as our Social Chrome announcement this week. (I want to make sure to give a big shout out to the team behind it; it’s getting some great press.)

You see, the Board is confident we can execute our current game plan in the short term. We’ve done some truly great work on updating the foundation of Yahoo!, and we’ve got some good things in the immediate pipeline. So, the Board’s focus is where it should be — on our long-term outlook, and how we best position ourselves to be successful in 3-5 years.

We need a flexible, visionary plan. That’s why the Board is actively looking at all the options available to put Yahoo! on a strong trajectory.

That being said, while the Board makes this decision, it does not mean we are in limbo. We have to keep Yahoo! moving ahead. And to do that, there are three things I need Yahoos everywhere to focus on:

1. Speed: Emphasize quick execution and decision-making

2. Accountability: Do what you say you’re going to do — and take ownership for time to market, monetization, user engagement, quality, or whatever metric defines success for your team

3. Purpose: Rally behind our mission and purpose: creating deeply personal digital experiences.

In the meantime, we will keep you updated as much as we can. And we will earn your trust — we know we have to.

Have a good weekend.

Tim

A new $10 million micro-venture fund, led by former Yahoo top engineering exec Ash Patel–called Morado Ventures and funded by a group largely made up of ex-Yahoos–is about to launch, according to sources close to the situation.

Expected limited partners in Morado, which means “purple” in Spanish, include former Yahoo CEO Terry Semel, former COO Dan Rosensweig and former advertising sales head Greg Coleman. Ex-Yahoo President Sue Decker is also considering investing, said sources.

Purple, of course, is Yahoo’s color.

Interestingly enough, the fund–which has not officially closed yet–is also likely to include Yahoo’s two founders Jerry Yang and David Filo, both of whom are still at the company.

Both will be limited partners and will not make investment decisions. In addition, Morado has no affiliation with Yahoo.

(Still, BoomTown would love to have been the fly in the room when Yang and Filo told current Yahoo CEO Carol Bartz about it!)

Patel will also be joined at Morado by Mike Marquez of investment advisory firm, Code Advisors, although he will also remain at Code.

Sources said the small fund, which is similar to an angel group, will focus on early-stage start-ups in the Internet consumer arena, as well as in the platform space.

Patel (pictured here)–a 14-year Yahoo veteran whose last job at the company was as EVP for Product Architecture & Strategy–certainly has experience in these areas.

He took a sabbatical from the company last November, but never really returned.

Sources said Patel has been doing some of his own investing since then, but was eager to involve himself with start-ups.

While ironic in many ways–the kinds of innovative companies that Morado will likely be investing in are just those that have put the slower-moving Yahoo in just the situation it finds itself in today–it’s a great idea for a fund run by longtime operating execs.

And while many execs from a variety of Silicon Valley companies have become VCs, angel investors and such, this gathering of former execs from the same company is definitely one to watch.

(Plus, BoomTown is guessing the parties will be fun too.)

I am sure I will be chatting with Patel in the future, but here is a video interview I did with him in late 2008 about the launch of some open and social networking initiatives at Yahoo (Former SVP Tapan Bhat, who had once reported to Patel, is also in the video):

Last year, Yahoo EVP Hilary Schneider and then-Media Group head Scott Moore had a summery seaside dinner with Demand Media co-founder and CEO Richard Rosenblatt (pictured here) in Santa Monica, Calif., right around the corner from the online publishing company’s HQ.

While many speculated that Yahoo (YHOO) could be doing some friendly kibitzing to get a sense of where the eclectic network of general- and special-interest sites was headed, for a possible acquisition, nothing came of it.

That’s because at the time, Rosenblatt insisted that he was aiming to eventually take his company public and Yahoo was in the midst of ongoing corporate turmoil.

“There is a lot of potential here and I want to build a big company for the long-term,” said Rosenblatt in an interview with BoomTown last July (see video below).

But, as my post noted: “Still, at some point when Yahoo is not in the free fall it is currently in, Demand might make a great purchase for Yahoo.”

And now, a year later, as new Yahoo CEO Carol Bartz works to stop that slide, several sources close to the company tell me another look-see at Demand is likelier than ever.

That’s underscored with recent indications that a major strategy will finally follow through on making Yahoo’s massive but disparate service more social, especially its content offerings.

But would Bartz go as far as making a big buy now or would she be more likely to strike a massive partnership with Demand, from which Yahoo could learn a lot?

Such an acquisition could cost anywhere from $1.5 billion to–as was floated last year in better times–$3 billion. In addition, if Demand was to engage in more serious talks with Yahoo, there would likely be other suitors.

As costly as that is, some sort of link-up with Demand is an interesting idea, especially since Yahoo could use a bold and definitive move to signal social goals that play to its strengths and are not a copycat of more powerful social-networking sites now in place.

At a Morgan Stanley (MS) conference last month, Bartz said, for example, that “I do not believe we can invent the next Facebook,” while noting Yahoo still needed to be more social throughout the service, especially in its content.

And, just yesterday, a Reuters article about that focus was titled: “Yahoo’s Plan: Create Community from Isolated Sites.”

Said the article: “If [Yahoo co-founder David] Filo and new CEO Carol Bartz have their way, the kinds of social networking features available on Facebook will become part of many Yahoo websites and allow their users to network with each other without using Facebook. The company hopes the strategy will help link its disparate properties, bringing more advertising dollars and growth.”

And that’s just at the heart of Demand Media, which dubs itself the “leader in social media.”

Demand was founded in 2006 by Rosenblatt and Shawn Colo, who raised a giant pool of funding–$355 million–from gold-plated investors like Goldman Sachs (GS), Oak Investment Partners and even a private investment from major Yahoo investor Gordon Crawford.

Getting that kind of backing was due to Rosenblatt’s entrepreneurial track record.

As founder, chairman and CEO, he sold iMALL to Excite@Home for $425 million in a 1999 stock swap.

And, perhaps most famously, as CEO of Intermix Media, Rosenblatt sold it with the company’s crown jewel, MySpace, to News Corp. (NWS) for $580 million in cash.

Then, Rosenblatt started Demand, which takes user-generated content of all kinds and on all kinds of topics–especially via video–from an army of freelancers and leverages it into massive traffic that it monetizes.

Demand is also the one of the bigger suppliers of video to YouTube, which it also monetizes.

And, through the acquisition of Pluck, the company also laces social-networking tools throughout the sites, as well as for many well-known third parties.

All this has given Demand upward of 70 million unique visitors per month, at sites like eHow and GolfLink.com, with about $150 million in annual revenue.

And–drum roll please–it is reportedly profitable, although how much is not clear.

While he has long maintained a public offering was on the horizon, despite the weak economy, Rosenblatt has also been interested in the idea of how to revive major players like Yahoo and Time Warner (TWX) online unit AOL.

Both have been struggling, but still have massive traffic and brand recognition, along with large advertising businesses.

And in many ways, the energetic Rosenblatt is just the kind of product-centric and visionary exec Yahoo lacks, despite Bartz’s clear ability to get the company’s management ducks in order.

What could be even more interesting, said one source, would be to marry Yahoo and Demand with a lot of what is going on with the publishing of niche sites at AOL’s MediaGlow content unit, in a giant publishing network.

Ironically, AOL was another acquisition target of Yahoo, in yet another deal that did not pan out last year.

Here’s the interview with Rosenblatt at Demand Media HQ last year:

On Friday, BoomTown first reported that new Yahoo CEO Carol Bartz is likely to be announcing a sweeping new management structure soon, which can only mean the possibility that some existing top execs are likely to be broomed out, even as some new ones are ushered in.

“This is going to be a full-scale peanut butter recall,” joked one exec, referring to the infamous “Peanut Butter Manifesto,” which was sent around the company several years ago by former exec Brad Garlinghouse. It laid bare the problems at Yahoo (YHOO), most especially a decided lack of decision-making and lugubrious levels of managers.

But the reorganization of Yahoo’s top-heavy management structures–I once dubbed it the “attack of the Yahoo vice presidents”–will be a bit sticky, given all the (slow-)moving parts at Yahoo (YHOO).

Nonetheless, Bartz signaled a “big week” ahead in one internal memo I obtained, which was sent out Friday.

So what’s to come?

Here’s a rough primer, based on talking to numerous sources inside and outside of Yahoo:

The Basics:

In order to start to revive Yahoo, Bartz is likely to impose a more top-down management style on the hopelessly confusing “matrix” organization now in place at the company.

She has spent the last six weeks touring Yahoo, getting to see a lot of presentations on its many, many products and conducting a whirlwind of meetings with execs.

Broadly, most expect Bartz to severely roll back a variety of previous reorganizations done by former CEO Jerry Yang and outgoing President Sue Decker, in order to impose more centralized control over the place and focus it more narrowly.

Presumably, lattes–paid for by Yang and co-founder David Filo–will remain free.

Out With the Old:

There’s no question that Yahoo is going to see the departure of several top execs, along with the elevation of others.

Among those who are more likely to be definitely in, though, is CTO Ari Balogh (pictured here), a relatively recent hire who has been a popular exec within Yahoo.

The Wall Street Journal first noted the possible rise of Balogh in a follow-up piece to this column’s story on the overall reorg over the weekend, noting that he would become head of product.

Presumably, Balogh will be one of the point men on what to do about search, in the should-I-stay-or-should-I-sell-now debate that never seems to end at Yahoo.

One interesting idea floating around Yahoo is that he becomes head of all its products, as well as continuing to run its tech arm.

That’s a good idea, since Yahoo has desperately needed an empowered leader under Bartz, who focuses like a laser beam on products.

“It all starts with that,” said one former exec. “One single person has to be the champion of what Yahoo makes.”

But what does that mean for Ash Patel, EVP of Yahoo’s Audience Product Division? Well, the longtime Yahoo veteran could now report to Balogh (he had previously reported to Decker directly) or, presumably, leave.

Patel’s fate, of course, impacts that of many others, such as Front Doors head Tapan Bhat, who is in charge of a major homepage redesign that Bartz just delayed the launch of to make it better.

Venkat Panchapakesan, EVP of the Audience Technology Group, seems safer, given that he reports to Balogh already and is responsible for the company’s overall product technology and platform strategy, such as its open efforts.

Also safer than not is General Counsel Michael Callahan, as well as U.S. EVP Hilary Schneider.

But Schneider’s purview might change a bit if U.S. advertising sales head Joanne Bradford–who now reports to her–is elevated to a higher position or if sales is taken out from under Schneider.

It’s not a stretch to imagine Bartz wanting more control of the part of Yahoo that brings in the bucks.

The fate of Connected Life Division EVP Marco Boerries is dicier–think Yahoo mobile and other devices–as it is for CFO Blake Jorgensen and David Windley, who heads human resources.

Both Jorgensen and Windley were favored by Decker, which does not necessarily make them goners. But both are in jobs on which Bartz will have to rely much more, so she might want her own choices in place.

Boerries (pictured here), a talented but more freewheeling exec under Yang, is another question all together. Already wealthy from selling several companies, the entrepreneurial exec is most often mentioned by sources as someone unlikely to stick around, especially if Bartz tries to rein him in more. (In addition, Boerries has family issues requiring that he spend a lot of time in his native Germany.)

As to the many Yahoo SVPs and VPs? Let’s just say it is likely there will be many fewer of them, as Bartz cuts, consolidates, simplifies and centralizes divisions more.

In With the New:

One hire that is definitely coming is a new chief of marketing to take over Yahoo’s brand, as well as its PR function. Yahoo has not had that kind of powerful exec in a long time, and it is more likely Bartz will go for an outside star here.

One outside name skittering around Yahoo for the role is John Vail (pictured here), director of interactive marketing for Pepsi-Cola North America, who knows Yahoo well.

(An obvious internal candidate for the job would be Yahoo’s Global Brand Marketing SVP, Allen Olivo, who could hit the road if not selected.)

Also a possibility is adding a COO with more Web experience to come in to help Bartz. There are plenty of candidates for that job all over the Internet sector.

But Bartz seems to be the kind of exec who favors flying solo and having key execs report to her to keep a finger on the pulse of a company. She is most definitely not going to have an entourage around her.

In fact, said one person familiar with the situation: “It’s long past time for new plumbing, and [Bartz] seems ready to flush a lot out that has long needed to go.”

With so many more ex-Yahoos out there now that the most recent layoffs have taken place, BoomTown put out feelers to a range of them to ask whom they would like to run the company they no longer work for.

After all, who better than to pick a new CEO than an ex?

The response I got was swift and varied wildly, depending on which way the ex-Yahoo felt the company should go, including quite a few who thought Yahoo needed to sell itself off completely.

Some considered Yahoo (YHOO) a media and advertising company, for example, while others thought of it as a more Web tools outfit. Still, others considered it a turnaround situation, requiring a wholly different kind of CEO.

Perhaps therein lies the problem–it is still hard to define precisely what Yahoo is and is not, even for its ex-employees.

In any case, here are some of the best suggestions:

1. The Media Mogul

“I think they need to sell to a media company,” said one ex-Yahoo, who posits the move needs to be drastic enough to truly reset Yahoo.

In this scenario, search gets sold to Microsoft (MSFT) and Yahoo’s online content is combined with media assets of a big entertainment and news conglomerate.

That would make the leader of Yahoo one of the following: Bob Iger of Disney (DIS); Rupert Murdoch/Peter Chernin of News Corp. (NWS); Jeff Zucker of General Electric (GE) unit NBC Universal; or Les Moonves of CBS (CBS). (News Corp. is the owner of this Web site.)

2. The Insider

A lot of votes here for former Yahoo COO Dan Rosensweig and not so many for current President Sue Decker.

Why? Several ex-Yahoos mentioned a need to refocus intently on products and the need for a product-obsessed leader, but one who also knew Yahoo well and could get things moving without needing a lengthy learning curve.

“Since Dan R. left, I think there’s been a definite void (at the senior exec level) on the product/consumer expertise and advocate front,” said another ex-Yahoo.

Other execs mentioned are former Yahoos Jeff Weiner and Jeff Mallett.

But several also pointed to board member John Chapple, who is the one most insiders say they are guessing will be the next CEO, especially since he has been reaching out to Yahoos on many levels and asking questions.

3. The Microsoftie or Googler

The new top name here is obviously recently departed online ad exec Brian McAndrews, former CEO of aQuantive, whom many think would be a strong pick and would focus the company on advertising.

In addition, most of those leaving–including several technical people–all seem to agree that Yahoo needs to get out of the search business, and pronto.

Said one engineer: “I hate to say this, but as good as we can be, we cannot compete in the war that is breaking out between Google and Microsoft. And it will only get uglier.”

Other names mentioned in this category include Yusuf Mehdi and Kevin Johnson of Microsoft, as well as Tim Armstrong of Google (GOOG).

4. The Fixer

While there are a lot of different opinions out there among the ex-Yahoos I spoke to, all agree that the company is in need of a sharp operator and someone who can do what it takes to turn the company around quickly.

That means someone like former Vodafone CEO Arun Sarin, whose name has popped up recently, or even nontechie execs known for operational skills.

“We need a decisive leader, given how slowly it takes for things to change at Yahoo, who has a real sense of urgency from the minute he or she gets the job,” said one ex-employee.

Another former exec described it as a “two-step process.” First, the turnaround CEO needs to come in and reorient, focus, and get the company going in the right direction, then a more product-oriented person can be installed under that CEO later.

5. The Holy Grail-Steve Jobs Option

I think the most interesting idea I got from all the many former Yahoos I spoke to was that Apple (AAPL) CEO Steve Jobs swoop in and buy Yahoo.

When I laughed out loud at this notion at first, the exec insisted that it was a feasible idea, given that Apple was interested in expanding its platform beyond its now-popular devices.

It’s an interesting bit of wishful thinking, of course, to imagine a “great leader” to calmly guide the company back to its roots.

Jobs, in fact, memorably addressed a meeting of Yahoo VPs in the fall of 2007. As I wrote then: “Jobs basic message [to Yahoo]: You have great assets–just like Apple did–and now it is all about execution.”

Yes, that tiny little detail.

6. Raise the Yangtanic

Interestingly, pretty much all the ex-Yahoos I talked to–as angry as some are at him for his tenure as a CEO less successful at execution and the ensuing loss of market value at Yahoo–said they did feel there was a need for Co-Founder Jerry Yang to stay around in a significant way.

“Jerry has been a really bad CEO,” said one former employee. “But he could still be an important leader at Yahoo and give the company the kind of inspiration it so desperately needs.”

Not everyone is on board with that.

“I completely disagree that Jerry should stay around. Jerry is one of the main issues at Yahoo and he and [David] Filo must go, as well as most of the board,” said one former Yahoo. “There needs to be free rein for the new CEO to make changes and that won’t be possible if Jerry is still there. Jerry is a nice guy and his heart is in the right place but he has failed as both board leader and CEO and the company needs to start fresh if it is to have a chance.”

Adds the ex-Yahoo: “Steve Jobs would be great, but I think he is busy.”

Today, a panoply of prominent tech and Internet leaders is taking a very public stand against a controversial initiative before California voters, which would eliminate the current legal right of same-sex couples to marry.

Forming a group and taking out a full-page ad in the San Jose Mercury News tomorrow, the execs hope to convince voters to reject Proposition 8, which is titled “Eliminates Right of Same-Sex Couples to Marry.”

Silicon Valley has had a long history of supporting gay rights. And recently, Google (GOOG) Co-Founder Sergey Brin has made a strong statement opposing Proposition 8, while Apple (AAPL) gave $100,000 to help defeat it.

The honorary co-chairs of “Silicon Valley Leaders Say NO on Proposition 8″ include: Brin; Bill Campbell, Chairman, Intuit; David Filo, Founder, Yahoo; Chuck Geschke, Founder and Chairman, Adobe Systems; John Morgridge, Former CEO and Chairman, Cisco Systems; Pierre Omidyar, Founder and Chairman, eBay; Sheryl Sandberg, COO, Facebook; Eric Schmidt, CEO, Google; and Jerry Yang, Founder, Yahoo.

In a statement in a press release set to go out this morning, Yang said: “Silicon Valley has always been an example for the rest of the country of how diversity and openness help to drive innovation and value creation. This divisive measure is the antithesis of those values that make Silicon Valley so unique.”

An ad the group–which also includes star venture capitalist Mike Moritz of Sequoia Capital, as well as Palm Founders Donna Dubinsky and Jeff Hawkins, and many others–is putting out tomorrow in the Mercury News reads:

Silicon Valley Leaders Urge You to Stand for Equality.
Vote No on Proposition 8.

As Silicon Valley leaders, we are committed to equality and fairness. We are opposed to Proposition 8 because it would change our state constitution to take away rights from one group of people. It would set our state, and our country, back in the fight for fundamental fairness and equal rights.

Please join us by reaching out to friends and neighbors and asking them to stand for fairness: Vote No on Proposition 8 on November 4th.”

(The ad and a longer list of tech leaders opposing Proposition 8 is below.)

If passed by a majority of voters, the California Constitution would be amended to include a new section stating “only marriage between a man and a woman is valid or recognized in California.”

Earlier this year, the California Supreme Court held that same-sex couples have a constitutional right to marry under the state’s constitution.

Former California State Controller and former exec at eBay Steve Westly noted that his own interracial marriage was once illegal, which is one of the reasons he was opposing Propostition 8.

“It really is the civil rights issue of the day … people stood up and fought for people like me and now it is time to stand up for others,” said Westly, who was an early supporter of gay marriage and is said to be eyeing a run for governor of the state. “While this is a polarizing issue, it is mind-boggling to me not to support the right of any two adults who love each other to marry.”

One thing is certain–the issue is indeed polarizing. Currently, the vote on Proposition 8 is very close, and a huge amount of money–more than $60 million–has been spent by both sides in the battle, which is considered one of the most contentious and high-profile in the nation.

Here is the ad (click on the image to make it larger):

LEADERS (partial list):
Deborah Barber, Principal, Jackson Hole Group
John Battelle, Chairman and CEO, Federated Media
Larry Birenbaum, Former Senior Vice President, Cisco Systems
Lorna Borenstein, President, Move
Larry Brilliant, Executive Director, Google.org
Owen Byrd, President, Byrd Development
John Chisholm, Chairman and CEO, CustomerSat
Barry Cinnamon, CEO, Akeena Solar
Tod Cohen, Director of Government Affairs, eBay
LaDoris Cordell, Administrator, Stanford University
Sue Decker, President, Yahoo!
Jack Dorsey, Chairman, Twitter
David Drummond, SVP, Corporate Development & Chief Legal Officer, Google
Donna Dubinsky, CEO, Numenta
Alan Eustace, SVP, Engineering and Research, Google
Naomi Fine, President & CEO, Pro-Tec Data
Rachel Glaser COO/CFO, Reunion.com
Carl Guardino, President and CEO, Silicon Valley Leadership Group
Andre Haddad, CEO, Shopping.com
Jeff Hawkins, co-Founder Palm, Handspring, and Numenta
David Karnstedt, Investor
Scott Kaspick, Managing Director, Kaspick & Co.
Steve Kirsch, Serial Entrepreneur
John Koza, CEO, Third Millennium
Ross LaJeunesse, Head of State Policy Western US, Google
Gary Lauder, Managing Partner, Lauder Partners Venture Capital
Laura Lauder, General Partner, Lauder Partners Venture Capital
Len Lehman, Investor
John Luongo, Former CEO, Vantive Corporation
Roger McNamee, Managing Director & co-Founder, Elevation Partners
Ken McNeely, President, AT&T California
Michael Moritz, Partner, Sequoia Capital
Susan Packard Orr, CEO, Telosa Software
Randy Pond, Executive Vice President, Cisco Systems
Amy Rao, Founder & CEO, Integrated Archive Systems
Jana Rich, Managing Director, Russell Reynolds
Miriam Rivera, Former Vice President and Deputy General Counsel, Google
Dan Rosensweig, Investor
Dan Rubin, Partner, Alloy Ventures
Hilary Schneider, Executive Vice President US Region, Yahoo
Len Shustek, Chairman, Computer History Museum
Jeff Skoll, Former President, eBay Inc.
Stephanie Tilenius, SVP, eBay North America
Joy Weiss, President and CEO, Dust Networks
Steve Westly, former California State Controller & former SVP eBay
Evan Williams, CEO, Twitter

[UPDATED on 11/05/08] In the interest of full disclosure, I am obviously not a supporter of Proposition 8. And, after I wrote this piece and hours before it passed last night, I got married in California under its recent same-sex marriage law, which the initiative has now overturned. It is still legally unclear what that will mean for people like me who married before Proposition 8 was passed, as it is not retroactive; as of now, the marriages remain valid. In any case, please see this disclosure related to me here.

It used to be, many years ago, that longtime Silicon Valley tech exec Eric Schmidt could work up a very significant head of steam when talking about the thuggish monopolistic practices of Microsoft and its negative impact on the tech industry.

And, for the most part, Schmidt was dead right–Microsoft’s overwhelming power then had a malevolent impact, both directly and indirectly, on innovation and openness in the digital sector.

Thus, BoomTown is both gobsmacked and a bit in awe that Schmidt–now sitting atop the high-tech pig pile as CEO of the powerful search giant, Google–can, with a straight face, make the argument that everyone is wrong to be nervous about its deal with Yahoo to serve some of its search and text advertising, even though the pair control more than 80 percent of the search market.

Because while Google displays none of the bullying tactics of Microsoft in its glory days–think of it more like a giant that could accidentally squash all us little people with its big dumb feet–the worries about it amassing too much power are well-founded.

Along with customers, competitors and anyone who fears a concentration of power in the hands of one player, I have been a critic of the deal since it was announced in the spring as a Hail Mary play to get Yahoo out of the clutches of Microsoft.

In addition, the Justice Department has hired an outside litigator to decide whether to proceed with an antitrust investigation of the deal and possibly look into Google’s business more deeply.

And just today, comScore released new stats for search market share for August; Google’s rose once again to 63 percent, up from 61.9 percent.

Both Yahoo (YHOO) and Microsoft (MSFT)–the distant No. 2 and No. 3–lost share, logging in at 19.6 percent and 8.3 percent, respectively.

In addition, Google (GOOG) accounted for 77.4 percent of all search engine spending in the second quarter of 2008, according to Efficient Frontier.

And–oh, yes–Google-owned YouTube dominates online video rather significantly.

Translation: Scary, like that-bullying-banker-Mr. Potter-from-”It’s a Wonderful Life” scary.

Still, at a press conference yesterday– my invitation must have gotten lost in the email so I will have to rely on the quotes collected by others–Schmidt went on the offensive to defend the Yahoo deal, which is set to begin in a few weeks, in a most peculiar way.

“While we have been talking to regulators, we don’t know what their position is,” Schmidt said. “We don’t know if they think it’s a good deal or poor deal.”

But Schmidt and other Google execs–including co-founders Larry Page and Sergey Brin–said they would move forward with or without regulatory approval.

“Time is money in our business,” said Schmidt, who also noted the deal was “designed precisely to meet the terms of antitrust law in the United States.”

Well, I am not sure being within the letter of the law is quite the argument I would make. After all, one can be entirely correct–and Google does love to be mathematically accurate!–and still be completely wrong.

Yet Schmidt pressed on!

“You face a question as a large company trying to change things: How many initiatives do you want to take on that are unpopular or lead to criticism?,” he asked, pontificating as if he were fighting for better health care for the world’s poor instead of just being able to sell small text ads hawking things like Viagra and electronics.

Schmidt said the deal would have “strong user benefits” and not raise online ad prices, part of Google’s basic argument that its auction-style business model makes that impossible.

As a side note, Brin–who was, I think, being completely genuine–said Google also felt a debt to Yahoo co-founders Jerry Yang and David Filo for helping Google get started a decade ago.

(Ironically, being the search option on Yahoo’s homepage was the key way Google grew and Yahoo damaged its future prospects).

But, while the payback argument is very touching, it ignores the fact that–on its very face–the No. 1 and No. 2 search and search-ad companies should never be in business together.

That Google leadership does not seem to understand these fears is disturbing.

And with what can only be described as an oafishly arrogant style, they seem to be dismissing anyone who raises concerns as being uneducated or simply a front for Microsoft’s lobbying efforts.

“We are quite certain Microsoft is busy helping everyone get upset about things,” said Schmidt, who has long loved to slap Microsoft at any opportunity.

As if we are all in the thrall of Microsoft (whom I, for one, smack around daily for its dopey Web strategies).

Google, it seems, is in the thrall of no one.

While the deal has been voluntarily delayed by three months, the redacted agreement Yahoo released said it had 105 days from June 12 to start. That would be Sept. 25.

Under terms of the agreement, either Yahoo or Google could end the deal after 120 days from when it was struck, if it was not “commercially reasonable” for either to defend. That would be Oct. 11.

In addition, Yahoo or Google can end the deal if a court later enters an injunction.

But Google does not seem to care about a possible noisy government investigation, which it should.

While Google is in no way guilty of the kind of behavior that got Microsoft into hot water, not caring what anyone thinks was perhaps the most disastrous error of hubris that Microsoft’s Bill Gates (he is pictured on the stand here) made when the federal government came at him and took him to trial.

After a long and bruising court battle in which the judge ruled the company had violated antitrust laws, in which Gates came off very badly, Microsoft eventually settled via a consent decree to rein in some of its behaviors.

And I think we can all agree that Microsoft emerged from that encounter deeply wounded and with diminished momentum that continues to resonate today for it.

There was one thing that Schmidt said yesterday at the press conference that I do agree with: “There is a natural fear of things getting larger.”

Yes, Eric. And, naturally, more people than ever fear Google.

And while that fear has not seeped down to consumers and impacted Google’s terrific brand quite yet, it surely will, especially if Google keeps claiming that it is not all that powerful when anyone with eyes can plainly see that it is.

Just ask Microsoft.

Please see this disclosure related to me and Google.

“Is that all there is, is that all there is.
If that’s all there is my friends, then let’s keep dancing.
Let’s break out the booze and have a ball,
If that’s all there is.”

Peggy Lee sang it best about troubled times in the classic song “Is That All There Is?”

But, dancing and making a video about dancing is obviously something that elevates Yahoo (YHOO), which is no small thing in this tough period for the iconic Internet company.

In the video below, Yahoo’s Yodel Anecdotal Blog Editor Nicki Dugan (whom BoomTown is immediately offering a job as AllThingsD.com video chief) takes the well-known dancing-fool Internet celeb Matt Harding of the Where the Hell Is Matt? Web site and places him all over Yahoo for 33 dancing sessions.

The video was recently shown at the company’s all-hands meeting, and it is simply delightful to see Yahoos looking happy simply by tripping the light fantastic.

I think activist shareholder Carl Icahn should make Harding one of his picks for the Yahoo board. (Icahn was officially appointed to the board yesterday, and his two board picks will be revealed Aug. 15.)

Highlights of the video of Harding dancing at Yahoo include Co-Founder David Filo’s infamous mess of a cube, a video conference jig with the team in Burbank, doing a sitting-down boogie with President Sue Decker, having a tango with Yahoo’s Purple Cow and a hip-shaking visit to “Frenemy Territory” at Google.

Best of all, of course, is a do-si-do with Yahoo Co-Founder and CEO Jerry Yang, who seems to be channeling an odd combination of Tony Manero in “Saturday Night Fever” and Barney the purple–how perfect!–dinosaur in his dance stylings. (Enter a caption contest here related to the picture above.)

Happily, this is the kind of dancing it is enjoyable to see Yang doing, because the two-stepping, shuffling and tap-dancing he is going to have to do to stay in power–after the much less sanguine shareholder vote this past week–is going to be much less fun to watch.

Here’s the video from Yahoo (all credit to Dugan and Yahoo) and the wonderful “Dancing 2008″ video that Harding did all over the world (I dare you not to smile):

While looking for news, any news, at Yahoo’s annual meeting in San Jose this morning, who should tap BoomTown on the shoulder but a blast-from-the-past Yahoo, former CEO Tim Koogle.

Koogle still has about 10 shares of the stock apparently, and I am not entirely clear why he is here, though I will surely find out what’s what.

But Koogle looks fabulous.

Also in attendance, besides various members of the Yahoo (YHOO) board and, of course, CEO Jerry Yang (he also looks fabulous, but rejected my effort to put Yahoo crisis PR dandy Adam Miller’s silk pocket square in his blue blazer for a little panache).

Also: Yahoo’s other Co-Founder, David Filo, President Sue Decker and 3,367 PR staffers (presumably here to make sure the press does not rush the stage in order to make some news).

Like the zombies in “Night of the Living Dead” who will not die, the notion of a big, sloppy deal for Microsoft to buy Yahoo is revived yet again in an article in The Wall Street Journal today.

Unfortunately for both Yahoo (YHOO) and Microsoft (MSFT), it mostly serves to point out once again just how messy and pathetic the proceedings have been and continue to be.

But, as to the central idea, that Microsoft is aching to do a multi-part deal with various partners that would render Yahoo asunder, BoomTown is altogether dubious that this will ever come to pass.

Nonetheless, the very idea of something, anything happening served its main purpose–to buck up Yahoo’s sinking stock, which got a nice pop from the article, after falling below $20 a share on yesterday. (It is now back at $21.55!)

I have argued many times that Microsoft should just make an offer for Yahoo whole, because it has few other such powerful options in its quest to compete with Google (GOOG) in the search space, even given the checkered history and bruised feelings evidenced in the piece in the Journal.

Still, as was posted here earlier this week, Microsoft is considering sweetening a search-ad proposal, including buying a big chunk of Yahoo and improving terms, and News Corp. (NWS), Time Warner’s (TWX) AOL and even Comcast (CMCSA) might enter the picture.

But the idea of engineering a giant Internet group hug among and between these players is a daunting task.

In fact, that plan is an oldie (but maybe not such a goodie)–for Microsoft to buy the search and search-ad assets of Yahoo and for the rest to be spun off into some sort of online content/software/social-networking company and mashed up with assets from either News Corp.’s MySpace or Time Warner’s AOL.

That second company, in a previous scheme, was called “TrafficCo,” which News Corp. head Rupert Murdoch acknowledged in an interview Walt Mossberg and I did with him at the sixth D: All Things Digital in late May. (Murdoch actually says it outright in this video of the interview.)

Clearly, such a deal would be good for News Corp. (owner of this site) and Time Warner, as they try to figure out how to maximize their Internet assets.

And linking them with Yahoo–still, despite all, one of the most significant sites on the Web–might be just the ticket.

But getting there is the real problem, with a very inept board of Yahoo floundering about and with Microsoft CEO Steve Ballmer in a bit of a pique over the situation.

Yahoo’s regulatory filing related to its upcoming proxy fight with billionaire investor Carl Icahn, for example, in which the company slapped Microsoft’s behavior in the takeover battle and called it “unresponsive and inconsistent,” really irked the folks at Microsoft’s Redmond, Wash., HQ.

In fact, the level of dysfunction and crossed signals in the Yahoo-Microsoft relationship, as depicted once again in the article, should give anyone pause.

Case in point, as I noted here: That Yahoo thought it was a good thing to send Yahoo Co-Founder David Filo–think Silent Bob and then think even more silent and of someone very unlikely to support a sale–with Co-Founder and CEO Jerry Yang to the key meeting with Microsoft to negotiate over a possible takeover pretty much encapsulates it all for me.

And then, with Yang offering to sell for $37 a share–while also adding he and Filo wanted $38–even though Microsoft had never gotten past $33, the situation actually worsened, if possible.

That meeting was immediately–within hours–followed by a complete Microsoft pullout.

But, like someone who cannot seem to stop falling down an endless series of stairs, there were even more comical meetings after that, with Yang, Ballmer, as well as Yahoo Chairman Roy Bostock and board member Ron Burkle, in which Yahoo essentially prostrated itself and was rejected again.

And yet hope–which I might call something else–lives on.

The last sentences of the Journal piece are particularly interesting in this regard:

“They believed that we needed them much more than they needed us,” one person close to Microsoft says. “Ultimately, we called their bluff.”

If that’s the case, people close to Yahoo say, they wonder why Microsoft continues to knock on their door.

Memo to Yahoo: Actually, it’s called Ding-Dong Ditch.

But that’s just a sidenote to the larger issues in the suit, which charges Yahoo’s directors with breach of fiduciary duty for not just rejecting Microsoft’s proposed deal, but also for going to great lengths to make it an unappealing acquisition target. “Due to their personal interests in maintaining Yahoo’s independence and their strong antipathy to Microsoft, [Yahoo co-founders Jerry Yang and David Filo] failed to consider and respond in good faith to the acquisition offers by Microsoft to the detriment of Yahoo and its shareholders,” the complaint argues. The two “used the threat of pursuing measures that make Yahoo an unattractive acquisition target, including the prospect of Yahoo abandoning its long-term business strategy in favor of a tie-up with Google that would make a Microsoft acquisition a regulatory and litigation quagmire, as an improper means to thwart Microsoft’s advances.” Moreover, “Yang convinced the board to adopt change-in-control employee severance plans that impose tremendous costs and risk for an acquirer, throwing sand in the gears of Microsoft’s plans for a smooth integration. These highly unusual plans reward employees with rich benefits if they quit and claim a constructive termination in the aftermath of a change in control.”

The plans at issue here, which would have cost Yahoo $1.5 billion, provided 100% equity acceleration for all employees. It is “a bizarre outcome if people who stick around make off worse financially than people who are laid off,” one Yahoo VP said of the plan. The company’s compensation consultant had a better word for it: “nuts.”

What was it Yang said during his interview at D6 last week? “I will probably never be a CEO again?“

Hey, he said it, not I.

Several major investors in Yahoo–who have been, how shall BoomTown put this delicately, freaked out by the sudden departure of Microsoft from the deal two weeks ago–have blamed the passive-aggressive style of Yahoo, and especially Yahoo CEO and Co-Founder Jerry Yang, on the collapse of those talks as a big problem.

They were also plenty irked that Yahoo then said big investors were with them on turning down the $33 price in its takeover bid.

But this time, according to several investors, Yahoo is making sure things go a little better, especially given the increasing anger on the part of its shareholders and the recent proxy attack from billionaire investor Carl Icahn.

Thus, Yahoo’s Chairman Roy Bostock himself has assured major investors that there are now others in the room–such as Yahoo’s independent directors, who are being called “adult supervision”–to make sure Yahoo’s (YHOO) latest revived talks with Microsoft (MSFT) go more smoothly.

“I would have been happy with a $33 price then and I would be happy with one now,” said one big investor to me this week. “But since that’s not happening now, I would like then to not screw up these new talks.”

The discussions in question, of course, first reported by BoomTown, are over the sale of Yahoo’s search-ad business and also search function to Microsoft–including a long-term and exclusive search-ad monetization deal.

It would be a complex transaction that also includes the sale of Yahoo’s Asian assets.

At this point, Yahoo is debating whether to also include search itself in the deal, which some at the company do not want to do, even though the company’s share is declining as Google’s rises.

Microsoft wants to own both Yahoo’s search and also search monetization. Yahoo is also seriously talking to Google (GOOG) about a search monetization outsourcing deal.

Thus, there is a lot of delicate negotiating to do and some are concerned that Yang cannot pull it off.

Many point to the meeting where the first talks all fell apart–Saturday, May 3.

There, Yang brought his Co-Founder David Filo with him to a meeting in Seattle with Microsoft CEO Steve Ballmer to try to come together on price.

It ended in disaster, of course, with Yang and Filo sticking to the $37-a-share price and Ballmer offering $33.

While Yahoo’s Yang and Filo left the meeting thinking it went well and more price-kibitzing would go on, Ballmer used it as an excuse to end the circus.

Frankly, I thought bringing Filo–a notoriously silent person, who was also key to stopping Yahoo’s merger with eBay in the Web 1.0 era, who is well known internally as someone who wants to keep Yahoo independent and who is, of course, a Google-deal fan–was a typical passive-aggressive way of flipping Ballmer off.

Now, according to investors briefed by Bostock, things will go a lot better with others involved in the talks with Microsoft.

“They are telling us it is ‘adult supervision,’” said the investor, “and that Jerry has more of a realistic attitude now too that some kind of transaction has to happen and Yahoo has few options.”

Apparently, Yang has gotten that religion himself and has been more realistic in meetings with top execs than he has ever been before.

Several execs at the company said the entry of corporate raider Carl Icahn into the mix (which investors compare to an effective red-hot Satan poker to get Yahoo moving) has gotten Yang to realize that Yahoo’s fate lies in some kind of dramatic transaction and soon.

“I think he realized it’s inevitable,” said one.

“Jerry is beloved at the company and he knows now that that’s at risk if he lets this spin out of control any more, so I think he’s wised up to the situation.”

Of course, there’s another way of saying that: Yang now has to take what’s going to happen to Yahoo like a man.

Off with the Yahoo CEO’s head!

OK, maybe not so much, at least today.

Indeed, according to many sources, Jerry Yang’s head still sits squarely on his neck.

And, moreover, his job as CEO has not been usurped by Yahoo (YHOO) Chairman Roy Bostock, who was allegedly–as one rumor went–authorized by Yahoo’s board, instead of Yang, to restart negotiations with Microsoft (MSFT).

(Which is kind of obvious when you actually think about it, given that Bostock is mired in this takeover collapse mess up to his own at-risk neck along with Yang. Bostock has been deeply involved all along and will likely continue to be.)

Thus, lots of smoke and little fire, contrary to rumor-based reports, like this one from TechCrunch–most of which seem to hang on the thinnest of threads (Where in the world is Yahoo board member Eric Hippeau?).

More importantly, even though they move share price, these rumors show almost no knowledge of how public company boards actually operate, which is to say with slug-like speed, even when under fire as Yahoo clearly is.

And if Yang were to go, I would guess it would be under his own steam or he’d be run out with Yahoo’s directors on a rail by angry shareholders.

Still, as a post yesterday of BoomTown’s book excerpt on the AOL Time Warner (TWX) debacle illustrates, even shoving aside a much-pilloried exec like former Chairman Steve Case, who presided over the merger disaster of all time, it took months and months and months and months and finally came well after the wheels fell off the bus there in a move made by Case and not his detractors.

And such a move to denude Yang, in the midst of the most trying time for the company, would make Yahoo’s board seem like particularly thickheaded morons–backing Yang strongly one day and throwing him overboard the next.

That is not to say Yang has not lost a mountain of credibility with Wall Street, investors, his own employees and in the industry in general, over the way he has handled the situation with Microsoft. The fallout from the debacle has damaged him badly.

The reviews are in and it is pretty much one million angry thumbs down.

Unfortunately, Yahoo’s leadership team has not exactly distinguished itself in the aftermath with their public statements, whether it be Bostock’s fanciful musings that Yahoo had the support of shareholders or President Sue Decker’s ungracious dissing of disgruntled Yahoo employees or pretty much the bulk of the backpedaling Yang has done.

And I don’t even know what to say about the excuse about the $33 offer not being written down as a problem by Yahoo execs, which makes them all move a little closer to Nearly Headless Nick in “Harry Potter,” in my estimation.

I do get their fervent need to explain themselves, especially in the face of such ferocious criticism.

But it has been so cringe-inducing to watch, that part of me wishes they would slink back into that cave Yang and his team have been living in all year long.

Obviously, Yang cannot and must now take the heat and find a way to clearly articulate a really good vision of what lies ahead for Yahoo.

That does not mean dangling the possibility of another deal with Microsoft to placate critics or pretending Yahoo wanted such a merger.

The very fact that Yang brought the painfully terse Yahoo Co-Founder and tech guru David Filo–who has fervently opposed a lot of Yahoo hookups in the past, like with eBay (EBAY) many years ago–with him to the key meeting last weekend with Microsoft CEO Steve Ballmer was all I needed to know to determine that the company did not want to sell.

So, Yang and the board got what they wanted–for now, at least–which is a very painful dose of independence.

If they want that to mean going back to talk with Microsoft, Yahoo should stop playing games and do so with a minimal amount of jockeying.

If it means making a series of bold moves to focus and define its business, then Yahoo should do that and quickly.

And if Yang can’t lead or is still lonely–he said last year of the CEO job, “It is a lonely job in the sense that you have to make some of the tough calls”–he needs to step aside for a new leader of Yahoo.

Because, even if Yang lives to fight another day, this much is clear: The clock is running down for him and his stewardship of Yahoo.

Yang is, as Dean Vernon Wormer of “Animal House” said so eloquently, on double secret probation.

So, if I were to predict, I would say six months without meaningful change is all he has.

And after that, I would imagine, is when the blade really starts really falling.

After today’s events, I guess you could say Yahoo (YHOO) and Microsoft (MSFT) tried, holding a series of meetings about a possible takeover that ended up proving exactly how incompatible the companies were.

Kind of like Oscar Madison and Felix Unger, but not funny in any way at all.

Consider a series of meetings, according to sources close to both companies, that took place over the last several weeks, which finally came after Microsoft CEO Steve Ballmer lobbed the Saturday stink-bomb letter to Yahoo in early April, saying he planned to go hostile.

That apparently prompted some movement out of Yahoo, which had been trying to avoid any kind of substantive discussions with Microsoft until then and had been spending its time looking for all sorts of semi-wacky alternatives.

Thus, according to sources close to Microsoft, a meeting on April 15 in Portland, Ore. (a state in which BoomTown said meetings were likely to take place last week).

At that meeting, Yahoo execs laid out the same case they had been doing for investors, a road-show presentation of the company’s growth plans to underscore its case for a higher valuation.

At the same time, Yahoo would not give a specific valuation for the company at that meeting, said sources.

But on a call with bankers and advisers from both sides on April 18, a big number was put forward by Yahoo of at least $40 a share. This was, of course, a nonstarter for Microsoft, which began plans for its hostile proxy fight.

As the deadline loomed on April 29, Yahoo sources said execs there wanted to avoid such a battle.

So Yang and Yahoo Chairman Roy Bostock held phone calls with Ballmer two times that day to suggest ways to avoid a hostile bid and also a walk-away move by Microsoft.

They also suggested, said Microsoft sources, other kinds of deals short of a merger, including a search partnership. Ballmer suggested a face-to-face meeting the next day, on April 30.

At that meeting, which took place in Silicon Valley at Yahoo’s law firm, Yang suggested $38. He also continued to press on major issues like possibly problematic regulatory issues around the pair’s email domination and also suggested the idea of a search deal, like the one Yahoo had been discussing with Google (GOOG).

Finally, as a last-ditch effort, Yang and David Filo–who founded Yahoo with Yang while the pair were at Stanford University as grad students–flew to Microsoft’s home in the Seattle area today to meet at the airport with Ballmer and also Kevin Johnson, the main Microsoft exec who had been spearheading the deal.

It was, of course, the kind of meeting–just the key execs alone–that should have taken place months ago.

Ballmer suggested $33 and a plan to assuage Yahoo’s regulatory worries, while Yang countered with $37, a price the board had approved, even though both Filo and Yang wanted the higher prices.

Worst of all, Yang told Ballmer that, if Microsoft chose to conduct a proxy fight, he would not abandon pursuing the deal with Google to outsource Yahoo’s online ad business, which Yahoo could sign even if Microsoft made a hostile bid.

Such a deal with its archrival, Microsoft execs thought, was impossible to accept and could also be hard to unwind.

“There was not a lot more to say after that,” said a source close to Microsoft.

Yang and Filo left the meeting, but the die was cast. While they expected a counter, Ballmer instead lowered the boom in a phone call and sent a letter saying so in detail soon after.

Another Yahoo source who was told the details of the meeting agreed that even today’s meeting was probably a lost cause.

“There has never been a moment when there was agreement on anything,” said the source. “Can you just imagine how a merger would have been with this as a prelude?”

Indeed. Cats and dogs. AOL and Time Warner (TWX). Oil and Water. Obama and Hillary. You get the picture.

After a months-long standoff, Microsoft (MSFT) has abandoned its bid for Yahoo (YHOO), people involved in the discussions said today.

Microsoft confirmed to BoomTown that talks between the two companies, which have been taking place all week, collapsed Saturday when they could not agree on a price.

According to sources close to Microsoft, the talks broke down this afternoon after a face-to-face meeting in the Seattle area that included Microsoft CEO Steve Ballmer, Kevin Johnson, president of Microsoft’s Platforms & Services Division and Yahoo Co-Founders Jerry Yang and David Filo.

According to sources, Microsoft offered $33 a share, and Yahoo countered with $37 a share. The talks went nowhere from there.

Microsoft was also concerned with the lack of friendly integration and other major strategic problems, including the email monopoly that would arise from the merger of the two companies, as well as any outsourcing ad deal Yahoo might sign with Microsoft archrival Google (GOOG) before Microsoft completed an acquisition.

In addition, Microsoft sources said, Yahoo requested other unspecified costs that Microsoft was unwilling to accept.

As BoomTown has written recently, there have been ongoing meetings between the two companies recently in a bid to avoid a nasty takeover battle.

According to sources close to Microsoft, they include a meeting on April 15 in Portland, Ore. (as BoomTown said here), another by phone on April 18 and a meeting that included Ballmer and Yang in California on April 30.

At several points during the last few weeks, Yahoo execs had asked for over $40 a share to consummate the deal, a price Microsoft rejected. Yahoo’s Yang subsequently called Ballmer with the lower $37 price, which was discussed today.

In a letter to Jerry Yang, Steve Ballmer said that Microsoft will not move forward with a proxy fight and will instead pursue a more “organic” strategy in the online advertising market.

…It is clear to me that it is not sensible for Microsoft to take our offer directly to your shareholders. This approach would necessarily involve a protracted proxy contest and eventually an exchange offer. Our discussions with you have led us to conclude that, in the interim, you would take steps that would make Yahoo undesirable as an acquisition for Microsoft.”

A deal with Google is what Ballmer is specifically referring to in his last sentence.

That is not to say that Microsoft might not circle back and again attempt to acquire Yahoo at some point in the future, especially if the company’s stock tanks on Monday, as many expect it will.

That could be a problem for Yahoo in its quest to remain independent.

The options for Yahoo include a partnership with AOL (TWX) or News Corp. (NWS), an outsourcing deal with Google–which may present other antitrust problems–or actually improving its business.

That’s the one thing, of course, that’s been a problem for Yahoo managers and what landed them in this mess in the first place.

Yahoo (YHOO) has been accelerating its open activities of late, mostly related to its search and ad infrastructure.

But, in his appearance at the Web 2.0 Expo in San Francisco next Thursday morning at a keynote speech titled “Yahoo and Open Platforms,” sources said Yahoo CTO Ari Balogh (pictured here) will sketch out a more significant broadening out of its open platform plans, which would touch consumers more directly.

That could include opening up everything from communications tools like mail to content to all sorts of products Yahoo offers its users to third-party developers.

In addition, the company plans to make as much of those and its own offerings more distributed, sending it all back out to the Web.

This kind of conceptual shift is something many have felt Yahoo has needed to do in a bolder manner, as consumer interest in massive centralized portals like Yahoo has waned.

The move, in many ways, has shades of what Facebook did last year when it opened its platform up to third-party developers, but also includes a vision of a more widgetized and social Yahoo, and a Yahoo available everywhere.

While Yahoo will not specify a date when all this will roll out, sources said Yahoo had hoped to have much of it in place by the end of the year.

This increasingly massive job of opening up more and more of the Yahoo platform to third-party developers and make its own products, APIs, code and content more highly distributed is being led by Balogh.

Balogh came to Yahoo from VeriSign, just days before Microsoft (MSFT) leveled its unsolicited takeover bid at the company.

Working with Yahoo Co-Founder and tech guru David Filo, Balogh has been given high marks from many sources I talked to within the company for bringing a faster-paced style than under longtime Yahoo CTO Farzad Nazem, who retired a year ago.

At the time, many felt Yahoo’s technology efforts had drifted under Nazem, whose internal nickname was “Zod,” as BoomTown reported back in June of 2007.

Setbacks in its Panama project to rehaul its online search-ad technology and a slowness in focusing on Web 2.0 distributed technologies have clearly contributed to Yahoo’s current predicament, in which its long-suffering stock declined enough to give Microsoft an opportunity to make its move on Yahoo.

Under that backdrop, Balogh is under intense pressure to deliver on one of CEO and Co-Founder Jerry Yang’s key focuses for Yahoo that he reiterated in a letter he sent on Feb. 14 to shareholders after Yahoo rejected Microsoft’s offer.

Underscoring the need to make Yahoo a “starting point” and a “must-buy” ad platform, Yang noted: “These key strategies will be enhanced by our adoption of new, more open technology platforms that will encourage the development of new applications and the involvement of third-party developers–and help enrich the user experience.”

While it does not get the credit it probably deserves, Yahoo has been moved squarely into the open-source space and, in fact, has made a series of announcements since the Microsoft bid from its implementation of Apache’s Hadoop in its search product to its support of the Google-led OpenSocial initiative to its recently announced AMP!, an ad-management software shipping this summer.

AMP!, said Yahoo, would allow “ad networks, through an open set of APIs, to innovate on top of the transparent marketplace.”

Yahoo Technology Evangelist Jeremy Zawodny might have signaled even more announcements in his well-read blog in mid-March, in fact, when he noted that Yahoo was a longtime proponent of open platforms and open-source technology.

Wrote Zawodny, who declined to speak to me yesterday about any further open initiatives, due to its quiet period around earnings next week, wrote on March 14:

“We’ve been on the openness road for a long, long time at Yahoo. And we take it rather seriously. Sometimes it hasn’t been as visible as others, but believe me, the trend is quite clear when you look at all the data. The Open Source adoption and work. The APIs. The way we communicate with users and partners. The Blogs. The RSS feeds…You’ll be reading more and hearing more about openness at Yahoo from me and Yahoo’s much higher up the food chain in the coming months.

Anyone who knows me knows that I come from open source roots and am a big proponent of opening things up more and more. I’d have left Yahoo years ago if I didn’t see it happening.”

Added Zawodny with some mystery: “If you think the last few weeks are big, you haven’t seen anything yet! :-)”

How glad BoomTown was to finally see Jerry Yang up close and personal, after our valiant but futile efforts to get near the Yahoo co-founder and CEO in 2007.

No, we’re not stalking him in a restraining-order kind of way, although I did stake a claim to a front-row seat in the intimate theater at the Las Vegas Hilton for his keynote this morning at the Consumer Electronics Show, where Yang couldn’t help but see me.

Like he cared!

Not at all, as he was riveted to delivering his shtick about Yahoo’s mobile efforts (it’s a 3.0 version, according to Yang, which is a good move since Web 2.0–in general and in particular–has not been so kind to the Internet giant), as well as giving the audience a glimpse of some interesting new concepts related to its popular email program.

The front rows were so packed with top Yahoo execs–including President Sue Decker, as well as David Filo, Jeff Weiner, Brad Garlinghouse, Ash Patel, Dave Karnstedt, Bradley Horowitz, Hilary Schneider and even Chairman and former Yahoo CEO Terry Semel–that you had to wonder who was running the show back in Sunnyvale, Calif.

(I mean, say, if Google had decided to launch a sneak attack today with their bicycle brigade, it could have taken over Yahoo without a shot fired!)

Yang maintained a low-key tone throughout the presentation, as is his way (I kept imagining the performance being done by Microsoft’s Steve Ballmer, who would have sold it all hard until he popped a vein).

Nonetheless, Yang did get the message through that opening its platform up to third-party developers would be a big push in 2008 for Yahoo.

So, the widgets in the excellent mobile product, called Yahoo! Go 3.0, are laudable and much more innovative than anything out there, even though Yahoo has been too quiet about marketing its Yahoo! Go product until now.

But at CES, Yang brought Yahoo Connected Life Executive Vice President Marco Boerries (pictured here) out to show off the mobile apps, including one from MTV (Viacom head Philippe Dauman and MTV Networks head Judith McGrath were in the audience) that seemed fun.

More interesting was Yang’s presenting new concepts for its Yahoo Mail product, which will be more social, relevant and integrated. A lot of this functionality is already being used by the open-source email company Zimbra, which Yahoo recently acquired (and whose head Satish Dharmaraj I interviewed last week).

As I wrote in that piece, I love the innovations, including ranking of those you email with most frequently and instant mapping from email, as well as a plethora of great features for email.

So, one vexing part of Yang’s presentation was that this concept needs to become a reality tomorrow. He brought out Co-Founder and interim CTO Filo to basically promise “soon,” but I say: Make it snappy!

I know, we’re pushy when it comes to Yahoo, but it’s because we care!

Well, care is not the right word exactly, but we are certain that a powerful and pioneering company like Yahoo can out-innovate these Web 2.0 newbies who get ridiculous funding to make goofy widgets and have the nerve to call it a business.

Thus, we took the chance and his prone position after the speech surrounded by well-wishers to go up and say hello in person to Yang, whom BoomTown has known for longer than either of us would care to say.

And, miracle of miracles, Yang said it had been far too long since we had gotten together and agreed to meet in 2008, a meeting for which we have been asking and egregiously posting about forever, to no avail.

How much does BoomTown love CES? Not so much.

But if it gets me lunch with Yang, I love it. So, Jerry, it’s officially 2008 and I am waiting by the phone for your call.

Here is my video of parts of Yang’s keynote:

We have almost nothing to report today on Yahoo, except to point out that there are only three more days until the official end of CEO Jerry Yang’s 100-day No-Sacred-Cows Vision Quest.

While we expect the day to pass quietly at Yahoo’s Sunnyvale campus, BoomTown will mark the moment while on the Big Island of Hawaii, where August Capital VC David Hornik is holding his first gathering called The Lobby. He’s billing it as a “new media salon,” but all I know is that there are a lot of Silicon Valley types I can annoy in paradise!

Speaking of annoying, the departure of Yahoo’s marketing chief Cammie Dunaway was more than a little confusing in that it was clearly done quickly and without a lot of preparation. That leaves yet another empty slot at the top of the company going unfilled with more changes in the organizational structure of Yahoo.

Essentially, President Sue Decker said in a memo that she was splitting up the Network Marketing Division from the Customer Experience Division, which were both under Dunaway. While there are interim people in place, it is obvious the job Dunaway had will be cut back in power.

While that might be a good thing, and change is often for the best at Yahoo these days, getting major execs to sit still for a while is also advisable. Of course, Yahoo does not always have complete control of this situation.

Right now, for example, there is no CTO in place at Yahoo, following the departure in June of longtime tech head Farzad Nazem.

I have been talking a lot to Yahoo techies about that situation, which remains in flux. According to them, they don’t expect a hire at all (which Yahoo had said it would undertake when Nazem left).

Instead, it is being managed by a troika of execs in three areas–Executive Vice President, Platforms and Infrastructure Division Ash Patel; Executive Vice President of Engineering Search and Search Marketing Qi Lu; and Dr. Usama Fayyad, Chief Data Officer and Executive Vice President, Research and Strategic Data Solutions.

Of course, co-founder David Filo, who has remained at Yahoo all this time (even still tinkering with its servers) hovers quietly above it all as the iconic techie of Yahoo.

So far, no dice!

I don’t know why, but it might have to do with Yang wanting to be sealed in a non-press bubble, while he does his 100-day evaluation of the company (although he has certainly gotten out and about in Silicon Valley, visiting everyone and their cousins in the tech sector of late).

Or maybe they don’t like the ongoing leaks to me and other reporters about the company’s doings from, well, everyone with an Internet connection at Yahoo (and that does not include the people who have left of late, of whom there are many).

So much is the displeasure that Yang made an impassioned plea to staunch the uncontrolled flow of tidbits about the company to the hundreds of VPs he gathered almost a week ago at what some who attended are now calling the “Kumbaya Summit.”

Though uninvited, I wrote a detailed account of the meeting, which included an appearance by Apple’s Steve “Oprah” Jobs, from such sources.

At the meeting, Yang argued that these alleged leakers, whom I would rather compare to whistle-blowers, were harming the company.

I don’t know about that, as I think most of them truly care about Yahoo, but feel frustrated with the leadership and want to do something to get things moving.

(And let’s hope execs there don’t get all vindictive and conduct a press-leaking witch hunt to find any of these employees, because I know that will only result in filling my inbox with even more juicy scoops for a long time to come.)

So it’s freeze time for BoomTown and we must remedy this sad state of affairs (see this nice picture above of Yang and other Yahoo co-founder David Filo at D3 with Walt and me in happier times).

But better yet: What if we could mend our relationship and also do good at the same time! And BoomTown readers can help.

In September, I wrote a post about a cool charity site called DonorsChoose.org, which funds classroom projects in high-need public schools, using the Web to match teacher project requests with donors.

The site allows teachers nationwide to upload proposals for resources and projects–from books to playgrounds–they need funding for and matches them with donors.

DonorsChoose then authenticates every project proposal before posting it, buys the resources when a project is funded and sends the goods off to teachers, with some donors also adding more money to pay for fulfillment costs.

Now, in the month of October, it has launched a “Blogger Challenge,” wrangling some bloggers to compete to raise money among our readers by picking favorite projects and setting a fund-raising goal.

Here is the AllThingsD page on the DonorsChoose site, and you can also access it using the nifty fund-raising thermometer on the left rail of this page.

I picked tech projects in both San Francisco (where I live) and Washington, D.C. (where Walt Mossberg lives) and we have set a goal of $25,000.

Some of the other bloggers involved, besides me, include Peter Rojas of Engadget, Michael Arrington of TechCrunch, Anil Dash of Six Apart, Fred Wilson of A VC, Lockhart Steele (formerly of Gawker) on his Curbed and Eater blogs, Apartment Therapy and Tomato Nation.

And Web companies are also participating: Google is giving an award for the bloggers who raise the most money, Six Apart an award for the bloggers who help the greatest number of students and Federated Media will award the bloggers who come up with the most creative incentives for readers to give.

We hope to win that too, via our dastardly master plan of winning the award Yahoo is giving. The company is sponsoring an award for the bloggers who inspire the most readers to give and the winner will get a free lunch with Jerry Yang!

That’s where you come in! I need numbers! Hundreds! Thousands! From Yahoo’s troops even!

Even Yang agrees!

“The DonorsChoose.org Blogger Challenge could inspire the blogosphere to help hundreds of thousands of students from low-income communities,” said Yang in the press release from DonorsChoose about the challenge. “This challenge represents a great union of citizen journalists and citizen philanthropists. Yahoo is excited to see which bloggers can engage the most readers in improving our public schools.”

In point of fact, Yahoo has been very generous to DonorsChoose, giving out donation certificates to its employees, helping in the charity’s tech build-out and being uniformly generous in making donations.

Sure, you can get riveted to TechMeme’s new Leaderboard (we’re No. 45! we’re No. 45!) if you want to know where you rank with a bunch of fellow bloggers or you can pick your little head up and look at the wide world out there in desperate need of some geek-fueled help.

Yes, we can! And, as a reward for your generosity to those in need, I will make a video for you of Yang munching on a grilled cheese sandwich!

Also below is a video I did of DonorsChoose Founder Charles Best, talking about the charity:

And here again is the AllThingsD page on the DonorsChoose site.

Digital Daily’s John Paczkowski is blogging from TechCrunch40 in San Francisco. Technical difficulties at the conference site prevent him from live-blogging, so he is summarizing with the following report on this keynote panel, dubbed “Humble Beginnings,” in which Sequoia Capital’s Michael Moritz (pictured far right, above) interviews Marc Andreessen (founder Netscape and Opsware, co-founder Ning), David Filo (co-founder Yahoo) and Chad Hurley (co-founder YouTube).

• Moritz asks Hurley (pictured right) to reminisce about his first business years ago in Pennsylvania. Apparently Hurley’s background is in art: He got his start when he discovered the intersection of art and business at age 5, trying to sell plywood paintings.
  (Plywood paintings? Cheaper than felt, I suppose.)



• Filo (pictured left) is asked how he got from Louisiana to California. Answer: Stanford.
  (No kidding! Half of Silicon Valley would likely answer that question the same way. Was Moritz expecting something different?)
• Andreessen (pictured below) is asked about his humble origins in Wisconsin. What brought him to California? Answer: “I wanted to get the hell out of Wisconsin,” (Half of Wisconsin would likely answer that question the
  same way. Kidding.) He adds that he was intrigued by the ideas then driving Silicon Valley.
• Filo asked about how he and Jerry Yang got the urge to bail on Stanford and venture out on their own. “When we first got started,” he replies, “we didn’t think of what we were doing as a business at all.” He notes they were forced to decide between Yahoo and a Ph.D.
• Way back in the beginning, Moritz asks, didn’t Filo and Andreessen have some sort of business relationship? Filo replies that Andreessen and Netscape folks gave early Yahoo a bit of rack space at their data center.



• Moritz then questions Andreessen (right):
  Q: At the beginning of Netscape did anyone have any sense what the
  subsequent 5 years would look like?
  A: No, of course not.
  Q: Were there key moves you made in the first 50 or 60 days that were instrumental to your success?
  A: Initially everyone thought we were going to charge for Netscape. But then we released it for free. That brought us a lot of buzz and a lot of traction as well.
• Moritz to Hurley: How did you conceive of YouTube?
  A: We wanted to solve a problem–online video. We didn’t see it as a business, either.
• Moritz: How often has business gone in a direction you never would have conceived of even in your wildest dreams?

  Filo: Well, Yahoo was one of the first businesses that had no revenue or even future prospects for revenue, so that was pretty unusual. Email, etc. were all relatively unexpected directions for Yahoo which was conceived as a directory. Apparently, every business Yahoo’s pursued has been one that Filo never would have imagined. (Good explanation for Terry Semel.)

  Andreessen: “CEOs are special people.” (Nice. Wonder if there’s an associated public-service campaign: “Hi, I’m Marc Andreessen for CEOASP— CEOs Are Special People.”)

• Moritz: Chad, were you surprised by the issues you encountered as YouTube CEO?
  A: Difficult to transition from developing the product to managing the business. Need to put the right people in place in order to survive.
  (I wonder if Hurley will save that little gem for play on famous
  business book by head of GM…)
  Moritz: Chad, do you remember a time when you worried that you’d lose the business?
  A: There was a time when we were growing far too quickly for the data centers that were hosting us. We were forced to go out and build in order to continue. There are a lot of media companies that feel threatened by us now. We just need to educate them about what we’re doing. There are a lot of media companies that feel threatened by us now. We just need to educate them about what we’re doing. (Bet Viacom CEO Philippe
  Dauman would get a good laugh out of that one.)
• Same question to Andreessen, who obviously has some meatier answers: Rambling history of OpsWare. Long story short, the market crashed, we were sitting there burning cash and so we did a “restart,” we essentially reconceived the company as a software outfit and packaged up and sold the portions that remained. Ironically, it was a great time to start a company, because it was a lousy environment and everyone else was afraid of doing it.
• Moritz poses the next question to the panelists: What are some of the worst decisions you’ve made?
  (Besides agreeing to participate in this panel?)

  Hurley: We didn’t hire fast enough.

  (BZZZT. Wrong.)

  Filo: We never understood the magnitude of the business opportunity ahead of us. We underestimated. That said, it’s not clear that if we had, things would have gone differently. We’ve made some bad short-term decisions that would have benefitted from a long-term view.

  Andreessen: He recalls a period when search engines were paying Netscape to advertise to the traffic that was coming to Netscape.com. “We viewed that as free money. But I always wonder what might have happened if we’d suddenly decided we weren’t a software company, but a content company and suddenly changed our business model.”
  (Netscape-Time Warner, obviously. Duh.)

• Another general question from Moritz: Who in tech do you admire the most these days?
  (Mike Moritz?)

  Filo: Steve Jobs. He cites Apple’s culture of innovation and design and marketing savvy.
  (Damn. Wrong again.)

  Hurley: Steve Jobs. Notes Jobs is a great speaker.

  And you, Marc? Jobs trifecta! Andreesen agrees, it’s Jobs.

  (Five dollars and my pass to this conference says everyone in the audience is silently wishing it was Jobs on stage right now, instead of these three.)

• Wrap-up question from Moritz: What’s the time you’ve enjoyed the most in your career?

  Filo cops out: “Every period, every year had its moments. You could pick any one.”
  (Precious and few are the moments we two can share, Jerry …)

  Hurley: “It’s great when you first start. It’s hard to replace the experience of that time when you didn’t quite know what would happen next.”

  Andreessen apparently opts to deliver his answer telepathically or Moritz skips him, because he’s not given a chance to reply.

• Audience Q&A:

  Tips for start-ups?
  Andreessen: 1. Have a founder who can be CEO. 2. Don’t hire too many people too quickly. Keep the team size small until you identify a product for which there is a market.
  Hurley: 1. Keep your team small. You can iterate faster. 2. Look at how you personally use your product and use that to guide your development.
  Filo: Hire passionate employees.

  Softball question to end all softball questions: What are your favorite Web sites?
  (Rotten.com? Diaper Pail Friends?)

  Filo: Sequoiacapital.com (laughter). TechCrunch.

  Hurley: Facebook.

And that’s the big finish. Off to find coffee.

Writing about however many millions of dollars go to however many frivolous widget companies is about as interesting as watching Robert Scoble’s blog video lectures. (Sorry, Bob!)

So it is nice to see a good (and good-for-you) charity site like DonorsChoose get some money and, hopefully, attention.

The site, which lets teachers upload proposals for resources and projects–from books to playgrounds–they need funding for and matches them with donors, has to be limited in geography. But today, it will open its services to every public school in the U.S. to allow teachers nationwide to get their wish lists fulfilled online.

With the national expansion, the nonprofit hopes be on track to becoming 100% self-sustaining, according to its founder, a former Bronx schoolteacher named Charles Best.

That’s due to $11 million in possible funding from a panoply of big Web players. EBay Founder Pierre Omidyar has promised to pony up $6 million, with Yahoo’s David Filo, longtime VC Vinod Khosla and Netflix’s Reed Hastings adding in the rest. (Khosla was an early supporter, allowing the site to expand to the San Francisco area from its New York base.)

The catch for the funding? Omidyar will release the bulk of his commitment only if DonorsChoose completes the round by Nov. 30.

It seems like a pretty good investment to me, using the Internet to clarify and amplify the donating process. Sort of like eBay meets Match.com meets Amazon. So far, the site has given away $14.5 million to projects.

Best says DonorsChoose authenticates every project proposal before posting it. Then it purchases the resources when a project is funded and sends the goods off to teachers, with some donors also adding in more money to pay for fulfillment costs.

That will now be a lot cheaper and more efficient due to a donation by Ariba of fulfillment software and services to DonorsChoose that the site values at over $2 million. That follows a donation by Filo, said Best, of five Yahoo engineers who were lent to DonorsChoose full-time for five months to rewrite its code base.

But Best is more articulate than I can be, so here is a video of him talking about his site:

One difference compared to the all-male revue at Facebook (I know there are some fine women execs at the social network, but they are not at the tippy-top), women play key roles at Yahoo.

So here’s the latest dream team head shots and a little background on each below the photos:

Yahoo co-founder and now CEO Jerry Yang is holed up on his 100-day vision quest, trying to channel some of the sass and energy of the early days of Yahoo, when life was a purple and yellow heaven of big, wet kisses from the press, a rocketing stock price and no irksome algorithm twins Larry and Sergey.

Those were the days, my friend, he thought they’d never end.

Well, they did–with a thump.

But Yang has been through a downturn before–remember 2001?–so it would be stupid to count him out.

Passionate, serious, often sarcastic (although I suspect that might just be to me and I deserve it), he is not the young fogey he appears to be. Plus, people at the company, for the most part, are rooting for him.

Second-in-command Sue Decker needs no introduction anymore at Yahoo, having engineered the latest management shuffle wherein most key elements–save tech–of the company report to her.

In other words, boys: That’s Ms. Decker to you!

The former analyst-turned-CFO-turned-capo-de-tutti-capi now seems assured of the CEO spot, but only if she can catch the falling knife of the stock and get things a little more stabilized. That means she will be under pressure for results as of yesterday.

Though plagued with the image of not having much operational experience, you might not want to bet against the Harvard Business School graduate.

She is also very aloof to the press–she has shunned interviews for the most part, so far, and we’re all starting to take it personally–and has the formal demeanor of someone much older.

But her pulled-together, plain-spoken, no-fancy-gimmicks style has gone over well with Wall Street and the Yahoos are warming up to it.

Hilary Schneider got out of the dying newspaper business at Knight Ridder, where she co-managed print operations as well as its digital division, just as all hell was breaking loose and joined Yahoo last fall.

Talk about jumping out of the frying pan into the fire!

But Schneider knows from trouble: She was president and CEO of the once high-flying Red Herring Communications, was president and CEO of Times Mirror Interactive and was at the Baltimore Sun–all of which faced significant challenges.

While some are worried about her lack of serious experience selling ads, most at Yahoo like her a lot, calling her a straight-shooter and easy to work with.

She is obviously a quick learner, although the curve just got awfully steep, even for yet another Harvard Business Schooler.

Wild card Jeff Weiner just got a lot more under his purview in the latest reorg or, more precisely, got back what was taken from him in a previous reorg.

While Schneider has got all the big money divisions compared to the smaller commerce and local stuff Weiner now has, he also has command over all the consumer-facing properties. Mail! Media! Search! All the stuff Yahoo is much better at than Google (except the search part)!

While some Yahoos insist that the protege of former CEO Terry Semel will eventually leave the company, Weiner appears to have a remarkable staying power.

And given that a lot of Yahoo’s future is riding on the mostly top-notch products his divisions create, stamina will be key here.

Blake Jorgensen is the CFO and he looks like one. I got not so much, as he just arrived at Yahoo, although I did interview him briefly here.

Was best man in Decker’s wedding. Harvard Business School, of course, in this excessively Ivy League group. Former big-wheel investment banker and manager at Thomas Weisel Partners and Montgomery Securities. Serious.

The rap: Never been a big-company CFO. Otherwise, seems to be a team player who will follow Decker’s orders. After all, she was his predecessor in the job.

Co-founder David Filo is often left out of the corporate tussle news at Yahoo, given his quiet and unassuming nature. (True story: I had to spend the Y2K New Year’s Eve night with Filo at Yahoo HQ for that idiotic story and he said about 37 words total all night. Fun!)

But make no mistake, Filo is no shrinking violet when he wants something and he remains the heart and soul of the tech part of the company and a critical symbol to his loyal engineers.

Thus, Filo will be key until Yahoo brings in a new top CTO. Plus, he represents the kind of stalwart continuity Yahoo needs right now amidst all the change.

The rest of the crew: Oh, there are a lot more, of course, but to name a few: mobile guru and resident obstreperous entrepreneur Marco Boerries; new shaking-things-up-a-lot-in-PR’s Jill Nash; controversial HR head Libby Sartain; politically aware Peanut-Butter-Manifesto guy Brad Garlinghouse; ivory tower thinker and funny guy Bradley Horowitz; former Doritos and Cheetos cheerleader and marketing head Cammie Dunaway; and super-duper-nice U.S. ad sales guy Dave Karnstedt, whom I interviewed here recently.