No longer just about using your smartphone to make purchases, mobile payment options are now popping up in transit systems in metropolitan areas, as companies look to gauge consumers’ appetites for buying products while truly on the go.

EBay-owned PayPal has just launched a pilot in Singapore’s subway stations for commuters to buy goods while en route. The experiment, through which eight merchants will offer Valentine’s Day gifts at reduced prices, is being conducted across 15 subway stations across Singapore.

Commuters can make purchases by using their smartphone to scan a QR code on a billboard or poster, and can then pay through a PayPal account. (For those wondering how cell service might work while riding a subway, Singapore has long boasted complete underground coverage, in addition to being one of the most Wi-Fi-friendly cities in the world.)

Earlier this week, New Yorkers learned that they would be able to purchase beauty products while riding in some taxicabs, with just a swipe of their smartphones.

Launched by Glamour magazine as part of a Fashion Week experiment, 50 Manhattan cabs will be equipped with SnapTags from technology company SpyderLynk; according to a Wall Street Journal report, VeriFone, which handles payments for New York City cabs, will power the beauty product purchases, as well.

The experiment was inspired by the virtual stores launched in the Seoul subway system by the Tesco supermarket chain, the Journal says.

While mobile payments are becoming increasingly popular — even the Obama campaign has hopped on board — the companies pushing mobile payments forward are divided on their approach to the technology. Square, for example, uses a dongle that plugs into the iPhone to accept mobile credit card payments; it also offers an app that uses geo-fencing to allow a customer to pay when he or she is within a certain distance from a store. Google’s mobile payments app, Google Wallet, uses near field communication technology to transmit payments.

For PayPal, which recently doubled its mobile payments predictions for 2012 to $7 billion, the emphasis has been on options that don’t require near field communication; which, as my AllThingsD colleague Tricia Duryee points out, can be a limiting factor for adoption.

PayPal says that, aside from a smartphone and an app with bar-code scanning capability, no additional infrastructure — such as an NFC-equipped terminal — is required for merchants, retailers and consumers to participate in the Singapore pilot.

Late last year, PayPal began testing point-of-sale purchasing at Home Depot retail stores, in which a select group of PayPal employees can purchase items by using a PayPal-issued credit card or by entering an account number at the register.

According to sources close to the situation, Yahoo will announce the impending departure of four of its longtime board members, including chairman Roy Bostock.

The others headed out the door are Hewlett-Packard exec Vyomesh Joshi, Gary Wilson and Arthur Kern.

I had reported in several previous posts that this exact group of directors was leaving, and noted in one yesterday that it was about to happen, and that new board members were also on the way.

And, presto, it is so!

(Update: Yahoo confirmed all in a letter it just released from Bostock, which I have posted separately.)

Yahoo’s two new directors are former Rovi CEO Fred Amoroso and LiveOps Chairman (and former CEO) Maynard Webb, who was once COO of eBay (pictured, left to right).

Rovi does digital entertainment technology, while LiveOps offers cloud-based enterprise solutions.

The Silicon Valley Internet giant will also be adding three more board members, said sources, but those people are not confirmed as yet.

And it is not clear who will be chairman of Yahoo’s board, either. Intuit CEO Brad Smith has a full-time job, and the newly installed Weather Channel CEO David Kenny does, too.

Sources said the news is coming after the markets close, with other updates, including: The news-free status of its ongoing strategery (the Asian deal is coming along — blah, blah, blah — but you read that here yesterday in much more detail); ladling praise on new CEO Scott Thompson (also formerly of eBay); and giving props to co-founder Jerry Yang, who stepped away from the board and from the company several weeks ago.

The moves by Yahoo are designed to thwart a possible proxy fight that might be coming from activist shareholder Daniel Loeb, who has been working on a board slate of his own.

It’s been hard for him, and also for Yahoo, to attract significant names to the board. The two new additions are solid tech execs, although certainly not high-profile appointments.

Yahoo declined to comment.

Here are their bios from the Rovi and LiveOps Web sites, if you want to know more:

Fred Amoroso is a member of Rovi Corporation’s Board of Directors.

Fred Amoroso is a member of Rovi Corporation’s Board of Directors. Fred Amoroso previously served as Rovi’s president and chief executive officer from July 2005 to December 2011. Prior to joining Rovi, Mr. Amoroso served as an advisor to Warburg Pincus, an investment firm from September 2004 to June 2005. From July 2002 to August 2004, Mr. Amoroso served as the president, chief executive officer and vice chairman of Meta Group, an information technology research and advisory firm. From October 1999 until its merger with IBM in January 2002, Mr. Amoroso served as president, chief executive officer and a director of CrossWorlds Software, Inc. Prior to CrossWorlds, Amoroso was a member of the world-wide management committee of IBM, was general manager of IBM Global Services Asia Pacific and held various other executive positions at IBM. Before joining IBM, Amoroso held various positions at Price Waterhouse, now PricewaterhouseCoopers, including lead technology partner.

Mr. Amoroso holds a B.S. in systems engineering and M.S. in operations research from Polytechnic Institute of Brooklyn.

As Chairman, Maynard brings almost 30 years of experience developing and leading high-growth companies to his role at LiveOps. From December 20, 2006 to July 18, 2011, Maynard was also LiveOps CEO. He joined LiveOps from eBay where he served as Chief Operating Officer. At eBay, Maynard directed engineering and technology operations, product development, customer support, trust and safety, global billing, human resources, and legal functions. Prior to eBay, Maynard was Senior Vice President and Chief Information Officer for Gateway, Inc. He has also held management and leadership positions at Bay Networks, Quantum Corporation, Thomas-Conrad Corporation and IBM. A respected member of the Silicon Valley technology community, Maynard sits on the boards of several successful companies, including Salesforce.com, Admob and Baynote. Maynard holds a Bachelor of Arts degree from Florida Atlantic University.

But a month later, both PayPal and its parent company eBay say they have the depth of leadership necessary to execute its plan to enter the world of in-store payments.

In an interview, David Marcus, PayPal’s VP of mobile, made the case for why its mobile payments strategy will prevail in a market surrounded by incumbents like Visa, MasterCard and American Express, as well as new entrants like Google.

On the matter of Thompson’s departure, he downplayed the role of one executive.

“The strategy wasn’t one man’s thing,” he argued. “It was a shock for 24 to 48 hours, but we control our destiny, and it’s about execution now. So far, so good.”

In addition to speaking to Marcus and several other executives, AllThingsD got an exclusive look at the company’s newly constructed “Shopping Showcase,” which will be used to demonstrate to potential partners how it envisions next-generation payments will occur at the register.

From the ground floor of the company’s San Jose headquarters, it has built several realistic-looking facades, including a hardware store, a grocery store, a clothing store and cafe; users can walk from one experience to the next. I also tried out the experience of making a real purchase at Home Depot, where it is currently being piloted at many San Jose-area stores. (See the slideshow here.)

To be sure, Thompson’s departure was abrupt. He gave PayPal only 15 hours’ notice before the planned announcement that January morning by Yahoo.

But the company now maintains that its strategy for the next two years had long since been cemented, making it much easier to absorb the blow.

Over the next few years, PayPal will be trying to take its online relationship with 106 million consumers worldwide into the physical payments world, by extending its digital wallet services to cash registers at grocery stores, hardware stores and other retail locations.

It plans to do this through a series of different technologies, including PIN codes, credit cards and other services.

Meanwhile, other providers are trying to attack the market using near field communication, where users will tap their mobile phone at the register in order to pay.

Google, Visa, MasterCard and a consortium of wireless carriers, including AT&T, Verizon Wireless and T-Mobile, are all working on similar solutions, which will require retailers and consumers to upgrade their point-of-sale technology and mobile phones, respectively.

“Yes, NFC will be useful, and we’ll be there, but today we are trying to do more than replace swiping with tapping,” Marcus said.

He envisions shopping becoming a more fluid experience. Today, you pick out the items you want, place them in your shopping cart and then stand in line at the checkout.

But in the future, he asks, why couldn’t that change? What if you paid for items in the store’s aisles, or purchased them online before picking them up in the store?

NFC can be restrictive, because you have to be at a physical location in order to tap a terminal and pay.

The scenarios are possible, given how fast things are already changing.

Last year, PayPal exceeded its own expectations, reaching $4 billion in mobile payment volume. This year, it expects to increase that to $7 billion. One of those purchases last year was a $40,000 backhoe, which someone bought using PayPal on their phone.

“By the time NFC catches up, we will be in a world that will move away from the point-of-sales terminal,” he predicts.

As with PayPal’s traditional business, it expects to make money on fees, also called the interchange rate, which the retailer is responsible for paying. Its goal is not to provide a cheaper solution than the incumbents. Rather, it wants to provide other perks that will help retailers and provide incentive for the retailers to want to work with PayPal.

Such perks could include platforms that will allow the retailers to offer loyalty programs, shopping lists, credit options or coupons.

“If you add a payment method that adds 30 to 40 percent more volume [in business to the retailer], then the interchange doesn’t matter,” Marcus said.

Completed two weeks ago, the showcase is designed to woo major retailers and other potential partners that may be considering adopting PayPal’s mobile payments services.

The room includes several realistic-looking facades, including a hardware store, a cafe, a grocery store and a clothing retailer.

In each scenario, it demonstrates how it uses a mix of new technologies, offers and loyalty programs to make it faster and easier to and pay and stay engaged with the retailer.

What you won’t see is demonstrations of near field communications, which is a technology being used by many of its competitors. (To learn why it is not using NFC, read an interview with PayPal’s VP of Mobile David Marcus, coming later today.)

I also visited Home Depot in San Jose to buy something using my PayPal account. The service is now live at many of the Bay Area hardware stores.

Today, PayPal is one of the leading online payments companies, with 106 million users worldwide; but this year, the eBay-owned company is attempting to move offline, by partnering with retailers like Home Depot and other major chains to be announced later this year.

Here are the photos from the Shopping Shopping Showcase and Home Depot shopping visits:

View the slideshow

On Monday, the company is officially taking the wraps off its plans. Nicira — which I’m told is pronounced like “nice era” — aims to be the vendor of a new networking technology that’s built specifically for the age of cloud computing.

One of the most important enabling technologies of the age of the cloud is something called “virtualization”: As computers have gotten more powerful, thanks mainly to the progress of Moore’s law and ever-better chips — a single computer can, with the aid of software like that created by VMware, act like it’s 10 or 20 or 40 different computers, all at once. Each “virtual machine” has, to its user, all the properties of a physical computer, and ensures that a single machine is used in the most efficient and cost-effective way possible. Customers who use cloud services can quickly “spin up” new virtual machines as needed to meet new demands, usually within minutes.

But generally speaking, networking hasn’t kept up. The pipes through which bits pour in and out of data centers have gotten faster, but they haven’t gotten much smarter. Where cloud servers are flexible, precise and easy to manage, networks are, by comparison, blunt instruments. Meeting new demand means adding new capacity, and that usually means adding new hardware to the mix, and that usually takes weeks, if not longer.

If you’ve ever wondered if it were possible to “spin up” a virtual network as readily as you do a virtual machine, wonder no more, for that is precisely what Nicira wants to offer you, without the addition of a single new piece of hardware, but rather only some software that runs on your existing server. You don’t even need to have especially advanced networking hardware.

Its the kind of thing that could give big enterprises some new flexibility in managing their network infrastructure, particularly as need and demand peaks and drops, whether by the day or because of a seasonal change that happens just once a year.

The company already has customers: AT&T, eBay, Fidelity Investments, Rackspace and the Japanese telecom giant NTT are all using Nicira, the company says.

Nicira calls its product an NVP, or network virtualization platform, and it is being described as the sort of advance that comes along perhaps once every quarter-century. That’s a bold claim, but the argument on which the company is making it holds water. On a day-to-day basis, where you deploy an application in a data center is as much a function of how much networking capacity you have available as it is one of computing capacity.

Virtualization on servers allows you to spread a single app over as many physical machines as needed, but the network connecting those machines is what it is, and if it isn’t up to snuff, you can either enhance it by adding new routers and switches, or live with it. The result is that you can’t be as flexible with deploying apps as you’d like, and that certain machines end up being underutilized by as much as one-third, which is costly over time. You end up having to buy more servers, then pay to run them and cool them.

The Nicira NVP, as CEO Stephen Mullaney told me, “decouples” a virtual network from the physical network hardware. “All of the intelligence, all of the control, all of the services now get done in the virtual space.” The result, what was once a dumb networking pipe carrying bits into two different virtual machines running on the same one, can now be programmed to act in vastly different manners, according to rules in the virtual realm. In much the same way a single computer gets turned into a dozen, a single network can be subdivided and act like a dozen individual networks. Or the reverse: Several networks can be cobbled together to act like one. And a virtual network can be created on the fly in minutes, just like a virtual machine.

A network you can deploy in minutes saves a lot of money, because it allows you to move quickly as your networking needs change. Most big companies who demand the heaviest network loads have agreements with their service providers — usually big telecom companies — that a request for new capacity requires a week or more, because it requires the physical presence of technicians who have to install and provision new gear. But what if you can reconfigure your network in 30 seconds to meet the needs of some new application? That’s exactly what eBay’s Cloud Architect JC Martin found he could do after installing Nicira’s software on the company’s servers. EBay is a Nicira reference customer.

Other reference customers had other interesting experiences and uses to report. Japan’s NTT uses cloud data centers to run some 10,000 virtual desktops — think PCs that are all virtual machines — and found that it was easier to quickly switch between data centers during the rolling blackouts that have become the norm since that country’s earthquake last year.

There is, of course, a great deal more technical detail, but the point you have to get is that this company is out to disrupt the networking industry in a way that it hasn’t been disrupted in a long time. The traditional solution to networking problems is more, better, faster hardware, and companies like Cisco, Juniper, and Hewlett-Packard, among others, are constantly on the lookout for opportunities to sell more of that hardware.

But what if you could look a sales rep from one of those companies in the eye, and tell them that their latest million-dollar router or switch isn’t needed? Once upon a time, before the days of virtualization, if you needed a new server, you had to buy one and have it installed somewhere. Now you can, in most cases, rent space on one within minutes, or literally provision another with a few clicks of a mouse. It changed the expectation and much of the calculus of the IT industry. Many companies never buy their own servers at all, and rent space from cloud providers like Amazon, Rackspace and Joyent.

Exactly what a similar disruption might mean for networking vendors is a little hard to imagine, but if the folks at Nicira are right about the potential this technology of theirs has, it looks like that disruption is coming, one way or another.

In what is probably the most anticipated document ever received by the U.S. Securities and Exchange Commission, Facebook has filed to take its company public in a $5 billion initial public offering later this year.

Having endured lots of speculation around who owns exactly how much, there are now some hard numbers from the S-1 filing that hit the SEC Web site today.

Here are some details of the cap table, which is made up of both Class A and Class B shares, which carry different voting powers. Class B are the common shares.

Not surprisingly, co-founder and CEO Mark Zuckerberg owns the most equity of any single person. His 1.1 billion Class B shares give him almost a 57 percent stake — about half of which he owns and half of which are owned by others but over which he exercises proxy voting authority.

The 27-year-old entrepreneur also holds 42.2 million Class A shares, which represents a 36.1 percent stake of that group.

Facebook’s filing said he will sell some shares in the IPO, although it doesn’t specify how many. However, it noted that most of the proceeds from the sale will go toward paying taxes on his purchase of 120 million options of Class B common stock he also has.

Peter Thiel, the PayPal founder and CEO who sold that company to eBay, owns a 2.5 percent stake, which has decreased over time from the more than 10 percent he owned as Facebook’s first angel investor. Not bad for a $500,000 investment made in 2004.

Jim Breyer of Accel Partners controls more than 201 million Class B shares, amounting to a little more than 11 percent of Facebook’s equity, having led Accel’s participation in Facebook’s $25 million Series A way back in 2006. Breyer is also a personal investor; 11.7 million shares are his, and about 190 million shares are Accel’s.

Digital Sky Technologies, the Russian investment firm, has 5.4 percent of the Class B equity, or 94.6 million shares, owing to its $200 million investment in 2009, plus an additional $500 million in 2011. DST has also been buying Facebook shares from existing shareholders, allowing some to cash out their equity. It also has 36.7 million Class A shares, or 31.4 percent.

Goldman Sachs has a sizable 66-million share slice of Class A shares, or 56.3 percent. Last year, it was involved in the $1.5 billion round that included DST.

There’s also a batch of individuals with single-digit stakes and smaller ones of note.

Dustin Moskovitz: The Facebook co-founder owns 7.6 percent of the company or 133.8 million Class B shares.

Zuckerberg’s father, Edward Zuckerberg, a dentist, was rewarded with two million Class B shares in consideration for his providing early start-up capital to his son in 2004 and 2005. He was given an option to purchase the shares, but the option expired a year after it was given to him, without his exercising it. The board of directors — minus Mark Zuckerberg — issued the 2 million shares to Glate LLC, a company controlled by the elder Zuckerberg.

There are also a few names of note who don’t appear in the filing:

Microsoft had bought a stake amounting to 1.6 percent, stemming from its $240 million investment in 2007, which included a strategic alliance for advertising. Its stake, now likely less, is not mentioned in the filing.

Eduardo Saverin, the Brazilian co-founder, also has a stake worth a few points, but he is not mentioned in its cap tables.

And other VC investors, Greylock Partners and Meritech Capital Partners, are barely mentioned as well. T. Rowe Price owns 6 million Class A shares, or 5.2 percent, as well as 12.1 million Class B shares.

The filing shows that the top five highest compensated employees are:

Mark Zuckerberg’s base salary is $500,000 a year. Effective January 1, 2013, his salary will be reduced to $1 per year. He has options to buy 120 million additional shares of the class B common stock at a strike price of six cents a share, which expires in November of 2015.

COO Sheryl Sandberg made $382,000 in salary and bonuses in 2011 and received $30.5 million in stock awards. She has options to buy 4.7 million shares, of which 3.5 million have a strike price of $10.39, and 1.2 million a strike price of $15. Sandberg already holds 1.9 million shares of Class B common shares and holds 39.3 million restricted stock units, too.

David Ebersman, the quiet CFO whom AllThingsD profiled yesterday, made $382,000 in salary and bonuses and has 2.2 million Class B shares and 7.5 million RSUs.

Mike Schroepfer, vice president of engineering, made $334,000 in salary and bonuses last year. He holds 2.1 million in Class B shares and 6.1 million RSUs.

VP and general counsel Theodore W. Ullyot also makes $275,000 per year and is eligible for a $400,000 annual retention bonus during the first five years of his employment, through 2013. He has about 1.9 million shares and exercisable options and holds 3.8 million RSUs.

Then, there are Facebook’s outside directors: Venture capitalist Marc Andreessen; Erskine Bowles, the former White House Chief of Staff under Bill Clinton; Breyer; Washington Post CEO Don Graham; Netflix CEO Reed Hastings; and Thiel. Each were paid $16,700 in fees for sitting on the board. Bowles got 601,400 shares, while Hastings got 593,400 shares.

Andreessen also has 5.3 millon RSUs that vest over four years. Graham has one million RSUs. Bowles and Hastings also each have 20,000 RSUs.

MORE ON THE FACEBOOK IPO:

• Facebook’s Ad Business Is a $3 Billion Mystery
• Viral Video: Farewell to the No-IPO Mark Zuckerberg
• Zuckerberg Is the Billion-Share Man: Who Owns What, Who Makes What in the Facebook IPO
• Zuckerberg Tells Investors, “We Don’t Build Services to Make Money”
• Mobile Highlighted as Key Risk Factor (and Opportunity) in Facebook Filing
• Stop All That Poking: Facebook Filing Temporarily Crashes SEC Web Site
• Zynga Accounted for 12 Percent of Facebook’s Revenue in 2011
• Facebook Has 845 Million Users
• On Its Eighth Birthday, Facebook Files to Raise $5 Billion in Massive IPO (Get Your S-1 Here!)
• Go the F**k Back to Sleep, Silicon Valley: Facebook IPO Likely to File Later Today at Earliest
• Dude, Where’s My Facebook IPO Filing? (Ashton’s on Hold!)
• The Quiet Man: Meet the Less-Known Face of the Facebook IPO, CFO David Ebersman
• Facebook Board Meeting Today for Final IPO Okays
• Facebook (Eye)PO: Tracking the Truth of the Biggest Deal of Web 2.0
• Viral Graphic: Visualizing the Facebook IPO
• Is Facebook IPO on Track for Late May?
• IPO Watch: Facebook Hiring Brunswick to Help With Comms for Expected Public Offering
• Complete Facebook coverage

Rakuten is set on challenging Amazon’s global dominance by appealing to the third-party merchants Amazon works with today and by growing it’s digital content business to compete with the Kindle.

We recently learned about the company’s strategy through the eyes of Neel Grover, the CEO of Buy.com, Rakuten’s online shopping subsidiary in the U.S.

For now, Rakuten is admittedly Amazon’s much smaller competitor, though it is dominant in Japan.

The publicly held company is worth $14.5 billion compared to Amazon’s $85 billion market capitalization, and it pales in comparison to Amazon’s mass in the U.S. Buy.com is ranked 410th here versus Amazon’s sixth-place standing, according to Compete.

But Grover said Rakuten has a two-part plan for going up against Amazon.

First, it will target and partner with third-party resellers and merchants.

Amazon does this, too, but often ends up competing with the merchants because it has its own warehouses and products that it is selling, he said.

“Oftentimes Amazon will compete with the retailer. [Third-party merchants] teach Amazon what to buy and sell, which is ultimately not good for the merchant,” he said.

Rakuten, on the other hand, does not own any warehouses or any inventory itself and instead gives retailers — brick and mortar or e-commerce — the tools and traffic to support their own businesses.

In May 2010, Rakuten acquired Buy.com.

“I sought out Rakuten. … I thought their model was one that would give us a unique differentiator in the U.S. and we could learn and bring their model to our site and customers,” Grover said. “We are still in the final stages of transforming, and it’s taken a bit of time to get it transformed.”

But, he confidently added, “It will win out in the long-term.”

A similar approach is being taken by eBay, another e-commerce giant in the U.S.

The second part of Rakuten’s plan is to go after Amazon’s growing digital business, spanning music, e-books and other content.

In November, the Japanese company purchased Kobo, a runner-up in the e-reader race behind the Kindle and Barnes & Noble’s Nook. It paid $315 million in cash for the Canadian company.

Rakuten is banking on the Kobo in assisting with its move into providing downloadable media to consumers, starting with e-books.

At the time of the acquisition, Kobo CEO Michael Serbinis told All Things D that Rakuten will give Kobo the financial backing to grow internationally, as well as compete in the U.S.

“The U.S. is absolutely important. It’s fundamental. We have millions of U.S. users today, and we plan to grow that substantially, and internationally it represents a big opportunity as well,” he said.

Earlier this month, Buy.com started linking to Kobo from its site, so that consumers have the option of buying a physical copy of a book or a digital version. Other integration efforts are also under way.

It also wants to get into other digital content, like music. Back in 1999, Buy.com was one of the original sites to have a digital music store, but Grover said it was a pretty poor experience because of all the restrictions that record labels were mandating. A lot of that has now changed.

“We are definitely looking as a group at all digital content. … We are looking at different solutions, but today we have not continued on with our initial music store,” he said.

As with Kobo and Buy.com, acquisitions are always an option, he said.

“We’ll continue to look at everything that would make our business better. It hasn’t been shy over the past two years. We have a global vision to create an e-commerce marketplace offering all goods, and we continue to see that grow.”

And going up against Amazon, some serious growth is what Rakuten and Buy.com will need.

In November and December, the number of online transactions increased by 37 percent, and overall sales jumped by 25 percent. But the average ticket size declined by 9 percent, according to Chase Paymentech, which analyzes information across the top 50 e-commerce retailers.

As it turns out, more consumers are turning to e-commerce for more of their everyday spending, rather than reserving online purchases for big-ticket items.

Here are Chase’s three reasons for the decline:

• More consumers are purchasing digital media, which has a lower price point than most physical goods — MP3s cost less than CDs, e-books cost less than paperbacks, and apps cost less than game cartridges.
• Prices for popular electronics, such as tablets, e-readers and TVs, are falling.
• More retailers are offering free shipping, which eliminates the incentive to fill carts to reach a free-shipping threshold.

EBay, which is the first major e-commerce provider to report Q4 results, confirmed it was also seeing the trend. The company’s payments division, PayPal, reported smaller transactions during the fourth quarter across the merchants it serves.

John Donahoe, eBay’s CEO, explained in an interview that the biggest driver of that trend was eBay’s acquisition of Zong, a mobile payments provider that powers the sale of digital goods. In addition, Donahoe said retailers, including eBay, heavily discounted products in order to drive more purchases this holiday.

Amazon, which is the leading e-commerce provider, also said that it is selling a lot of low-priced digital goods, ranging from e-books to MP3s.

Historically, the company has said that Christmas is the largest day of digital sales on Amazon.com, followed by Dec. 26. In 2010, from Christmas Eve through Dec. 30, Amazon customers purchased three times more digital content — including Kindle books, magazines, movies, TV shows, music and digital games — compared to the weekly average for the year.

Despite transactions declining overall, Chase identified two exceptions: Apparel and footwear rose 6 percent; toys rose 10 percent year over year.

(Amazon photo courtesy of thisisbossi)

The yellow-handled hammer, which the eBay CEO purchased at Home Depot using PayPal, signals that the company’s plans for entering the mobile payments business has entered the construction phase.

In an interview yesterday, Donahoe provided a few details about the company’s Home Depot trial and how it would expand from five to 51 stores across the country over the next week.

He also talked about his own experience of buying the tool earlier that morning. (Seen at right: Donahoe wielding his hammer.)

The company also announced fourth-quarter results yesterday, solidly beating both the company’s internal guidance and analyst expectations.

One of eBay’s big initiatives over the past year has been to find ways to work more closely with physical retailers by providing them with the technology they need to operate more efficiently online and offline. Over the past year, that has included buying 13 companies, for a total investment of $3.4 billion.

“We are right at the intersection of something that’s really cool,” Donahoe said. “This isn’t something that everyone sees, like social networking three years into it, when only the early people knew about it.”

What everyone is not seeing, he explains, is how retail and payments are two massive industries that are “at an inflection point where they will go through dramatic change.”

One major opportunity is payments being made at the cash register, and arguably many others see it, too, including Google, Visa, MasterCard and the wireless carriers, which are all working on their own solutions.

Interestingly, Donahoe was willing to put a price on it — and it’s huge.

If eBay is able to capture just 2 percent of the sales occurring at the point of sale, it will be able to double PayPal’s $70 billion business today. If they capture 4 percent, they’ll triple it.

Of course, that will take some time.

This year, eBay is focused on learning and testing out the technology in several trials; then, in 2013, it will begin to scale the business. In 2012, the company is not even factoring in a lift from point of sales in eBay’s revenue guidance.

The company’s big test will start later this week, when it expands its trial with Home Depot from five stores in the Bay Area to 51 stores in the Bay Area, Atlanta and Omaha.

Everything continues to be on track, despite the unexpected departure of PayPal President Scott Thompson. Thompson shocked Donahoe right after the New Year with the announcement that he was leaving to become CEO of Yahoo.

Donahoe declined to give an update on his plans to replace Thompson, saying that he was fine with serving the interim role in the meantime, and relying on the rest of the team PayPal has in place.

So far, Donahoe said, the mobile payments technology works flawlessly, based on his own experiences, but there’s still some additional scenarios they will have to consider.

Yesterday morning, he drove to a store in San Jose, where he consciously left his wallet and phone in the car.

He walked through the aisles to find a hammer and tape measure, and then went to check out, where the terminal gave him the option of checking out with PayPal. He entered his mobile phone number and PIN, and the transaction was completed, with the receipts sent to his phone and email.

“It was faster than swiping the card,” Donahoe said. “This is an advantage that PayPal has. No one else can do it with a mobile number and PIN. There was no fancy whiz-bang technology.”

Customers will also be given the option of paying with a PayPal credit card.

But not all the pieces are in place yet.

Coming soon: Users will be able to store their loyalty cards in their PayPal wallet, and will be able to receive personalized offers based on their shopping habits.

Also, it’s worth noting that while Donahoe checked out easily, there will be a learning curve for others. In advance of going to the store, users will have to associate a phone number and PIN with their account, and enable their account for in-store checkout.

Right now, there’s no contingency plans for if a person doesn’t have a PayPal account, or if it’s not set up. In fact, a very small percentage of the more than 100 million PayPal users have likely done that.

“That’s exactly why I say this is the year for trialing and learning,” Donahoe said, appropriately adjourning the interview with a bang of the hammer.

The results beat both the company’s own revenue forecast of $3.35 billion and analysts’ estimates of $3.32 billion.

In after-hours trading, the company’s stock was up 66 cents, or 2.2 percent, to trade at $31 a share.

The rebound is perhaps a relief since the company’s stock had been trading somewhat lower since it announced earlier this month that Scott Thompson, the president of PayPal, was leaving the company to become the CEO of Yahoo.

The company’s earnings also exceeded expectations. Its non-GAAP earnings of 60 cents a share, which excludes some non-cash items, beat analysts’ expectations of 57 cents a share. Internally, the company had forecast non-GAAP earnings between 55 and 58 cents a share.

On a GAAP basis, the company reported $2 billion, or $1.51 a share, in the fourth quarter, bolstered by a gain on the sale of the company’s investment in Skype.

Retailers during the holiday quarter can often report mixed results, depending on consumer demand during the business shopping season. EBay’s results are perhaps a good signal for the overall market since it is one of the first e-commerce providers to report year-end results.

Amazon, the e-commerce leader, will report Q4 results on Jan. 31.

For the full-year, eBay said revenue increased 27 percent to $11.7 billion and net income totaled $3.2 billion, up 79 percent over the prior year.

PayPal, one of eBay’s fastest-growing businesses, also reported a strong quarter.

The payments division said revenues in Q4 totaled $1.2 billion, up 28 percent from the year-ago period. A lot of that was driven by new accounts and the adoption of mobile payments.

As previously announced, the company said its mobile payment volume reached $4 billion in 2011, more than five times the mobile payment volume in the prior year. It also said that it added one million new accounts on average each month of the year.

EBay said its forecast for the first quarter will not be as robust, which typically happens as spending levels go back to normal. It expects revenues of up to $3.15 billion, with non-GAAP earnings per share of up to 51 cents a share.

Asa Mathat | AllThingsD.com

Stephanie Tilenius demonstrates Google Wallet at the D9 conference.

Over the past year, Tilenius has been visible for her role in Google Wallet, one of Google’s biggest bets in commerce to date.

In May, she was one of the main executives to unveil Google Wallet at an event in New York, and a week later, at our D event in California, demonstrated how easy it was to tap an Android phone at the register to check out.

In a statement, Google spokesman Nate Tyler said: “Stephanie is moving to a new role where she will oversee global strategy and work with key partners to expand our commerce efforts internationally.”

Tilenius will continue to report to Jeff Huber, SVP of Commerce & Local.

In her previous role, Tilenius was overseeing Google Checkout, which recently merged with Google Wallet so that users needed only one payment account to cover purchases across Android Market, YouTube, Google+ Games and other Google properties.

The former eBay executive also played a role in Google’s negotiations to buy Groupon, which ultimately failed. Instead, Google launched Google Offers to compete with Groupon head-on.

Presumably, Tilenius will continue to work on all of these products but in an international capacity.

Tilenius was also in the spotlight in May, on the same day as the New York Google Wallet launch, when PayPal filed suit against Google and two of its former executives – Tilenius and Osama Bedier, Google’s VP of payments and former PayPal executive. The lawsuit claimed that Google and the two employees misappropriated trade secrets and violated contracts involving recruiting agreements.

He is forecasting that mobile commerce — purchases made from apps or the browser on a phone or tablet — will hit $8 billion in mobile gross merchandise volume this year, up 60 percent from $5 billion in 2011.

Donahoe made the predictions last night in Las Vegas, where he gave the keynote at a technology dinner for leaders of the Consumer Electronics Association.

Additionally, the company predicted that PayPal will reach $7 billion in mobile total payment volume this year, increasing from $4 billion in 2011.

He made the bold predictions despite the recent unsettling departure of PayPal President Scott Thompson to join Yahoo as CEO, indicating that he is still confident about PayPal’s mobile future.

During the keynote, Donahoe also announced that Best Buy was its newest partner to use the RedLaser barcode scanning app to offer local in-store pick-up services. Other companies that offer it today include Toys “R” Us.

Other big data figures: 

• EBay Mobile currently has more than 65 million downloads of its mobile applications across all platforms.
• More than 890,000 new eBay shoppers made their first eBay purchase through the company’s mobile apps in 2011, a 113 percent increase year over year.
• PayPal’s original prediction for 2011 was that it would achieve $1.5 billion in mobile total payment volume for 2011. Instead, it hit $4 billion. A year earlier, it totaled only $750 million.

MORE CES NEWS:

• Complete coverage
• HP’s Former CTO: Ultrabooks Are Nothing New, webOS Still Has Life Yet
• Walt Shows Off CES Gadgets for Fox Business News (Video)
• What Kind of Web Video Plans Does Sony Have? (Video)
• Fujitsu Seeking Way Into Crowded U.S. Smartphone Market
• Why Rhapsody Is (Probably) Bigger Than Spotify — In the U.S.
• Microsoft Beefing Up CeBit Presence Even as It Pulls Back on CES
• Inside the CES Lost & Found
• FCC Chairman Has New Tablet, but Same Script: More Spectrum!
• Verizon Wireless: We Want to Connect Five Devices for Every Subscriber
• Ultrabooks From HP and Lenovo That Are (Kinda, Sorta) Different
• Walt and Katie Take a Tour of CES (Video)
• Schmidt-Storm Alert: The Google Chairman Didn’t Like Your Question
• T-Mobile Expands Bobsled Messaging Service
• Intel Shows Just How It Plans to Get Into Phones (Video)
• Motorola CEO: We’re Going to Release Fewer Phones This Year
• Kinect Helps Keep Aging Xbox at the Top of Its Game
• More From T-Mobile CEO: On Pricing, LTE and That Ever-Elusive iPhone
• Exclusive: New Boss Acknowledges Windows Phone Still Has “Awareness Problem”
• And You Thought Jawbone UP Was Going to Miss the CES Party!
• Interview: T-Mobile CEO Says No Second AT&T Deal Out There
• Grover Is at CES and I Am Missing It
• BlueStacks Bringing Android Apps to Windows 8
• Why the Future of TV Won’t Be Here Soon
• Nvidia’s Tegra 3 Tries to Save Battery in All Sorts of Different Ways
• Dynamic Dual Coverage: Ballmer’s Last Act in Vegas and the BCS Championship in 3-D
• Microsoft Phoning In Its Last CES Keynote
• Myspace — Yes, Myspace — Says It’s Going to Sell You Web TV
• Samsung Unveils “Super” 55-Inch OLED TV
• Nokia Unveils That LTE Windows Phone It’s Been Dying to Share
• Steve Ballmer Gives Ralph De La Vega a Very … Vigorous Greeting (Video)
• Interview: AT&T’s De La Vega on LTE, Tablets and Life After T-Mobile
• AT&T’s De La Vega: Shared Data Plans Still in the Works
• LG: 55-Inch Glasses-Free 3-D Screen Is on the Way
• LG Pushes 4G Smartphone Through Verizon: The LG Spectrum
• Live: AT&T’s Vegas Act Stars LTE and, Making Her Return to the Stage, Nokia
• CES Notebook: The Constant Search for Power and Vegas’ Worst-kept Secret
• Belkin Bringing Mobile TV to Lots of Cellphones, Will Anyone Tune In?
• Acer Introduces “World’s Thinnest” Ultrabook and a “Me-Too” Cloud Service
• There Better Be Some Cool Stuff at CES, Because CE Holiday Sales Data Bytes!
• CES 2012: Snooki and Bieber Are In, Gaga Is Out!
• Coming to a Smartphone Near You: Gorilla Glass 2
• RIM Hopes Next PlayBook OS Will Impress at CES
• Ultrabooks, the Ultra-Fancy New Name for Laptops
• At CES, Expect More Gadgets Telling You to Get Off the Couch
• Intel to Detail Its Phone Plans at CES Next Month
• Microsoft Pulling Out of CES After Upcoming Show
• Intel to Detail Its Phone Plans at CES Next Month
• Dell Will Drop the Flashy Vegas Act for CES This Year
• Ultrabook Conga Line Preps for CES 2012

The e-commerce giant (a term typically reserved for Amazon in these woods) is one of the larger examples companies from the Bay Area that are setting up shop here and looking to soak up some of the Northwest’s rich engineering talent.

Other companies with satellite offices in the Seattle area include Google, Facebook, Zynga and Salesforce.

“I’m surprised I ended up at eBay, but the story is compelling,” said Ken Moss, who was hired in November to be eBay’s VP of managed marketplaces technology; Moss is GM of the Redmond office.

A long-time Microsoft employee whose claim to fame includes inventing the Pivot table in Excel, Moss more recently co-founded CrowdEye, a start-up focused on search technology and later on stock market prediction.

He said eBay’s dedication to the region is one of the biggest selling points for recruitment.

Most of the 75 employees that currently work there were hired over the past few months, and a small team has been here for seven years. Among the newbies I met were a number of Microsoft veterans who had been there for 12 to 15 years.

Moss says he will report directly to eBay’s CTO Mark Carges, which is “a signal to the whole company that diversified development is for real.”

“We are first-class citizens,” Moss said, referring to sometimes strained relationship between remote workers and a company’s headquarters.

Eric Brill, VP of eBay’s research labs, is also based in the Redmond office, and has been working part-time there since joining the company in 2009.

Moss said eBay will be looking to hire a range of technologists, from college graduates to senior leaders, including developers, testers, researchers, data miners and other positions.

While I was at the office on Tuesday, the mountains were peeking out from the clouds and were easy to spot from the floor-to-ceiling windows on the fourth floor. It was easy enough for everyone to have a window seat in the open-floor plan.

Although the employees just moved in on Monday, a sign outside the building already announced eBay’s presence. Inside, workers were busy putting the final touches on the space to make it feel like eBay. Primary colors of red, blue, yellow and green highlighted the office walls; with a bit of Seattle flair, conference rooms were named after Northwest tribes such as Puyallup and Quinault (and other names that might be difficult for San Jose-based employees to pronounce).

But missing were some of the perks that some recruits expect these day — no shuttles to and from work or fancy cafeterias, for instance. 

In fact, eBay has a long way to go to compare with what Google has done here. Since entering the market seven years ago, Google has hired more than 900 employees, spread across two locations, a spokesperson confirmed.

One office is in Seattle’s Fremont neighborhood; the other is on the Eastside.

The two offices are geographically divided by Lake Washington, which can be crossed by one of two floating bridges — or by boat, if you are crafty enough. The traffic bottlenecks make for a horrendously notorious commute, so having two locations that straddle both sides is a huge perk — like having offices in both San Francisco and San Jose.

Because of Google’s size here, many of its perks are similar to its Mountain View headquarters, including free meals prepared by chefs, frozen-yogurt bars and other, mostly food-based, luxuries.

In eBay’s case, the new digs are located deep on the Eastside, a couple of miles past Microsoft in Redmond, and roughly 15 miles from Jeff Bezos’s empire in downtown Seattle. Recently, Amazon relocated its headquarters to a brand-new campus in South Lake Union, a neighborhood being revitalized by former Microsoft executive Paul Allen.

Other outside companies that have also established sizable tech centers here include Facebook and Zynga. A couple others have gained offices through acquisitions. Electronic Arts, for instance, now has a large office here, after acquiring PopCap; EMC now has big expansion plans here, after purchasing Isilon.

And Geekwire, a Seattle-based technology blog, is good at keeping an ongoing tally, including recent moves into the area by Jawbone and SweetLabs, a San Diego-based start-up, based by Intel Capital and Google Ventures.

Two years ago, Facebook opened an office in the heart of downtown Seattle. It plans to move soon to a 27,000-square-foot space that will have room for about 135 employees. The 70 or so engineers in the office today have worked on projects such as video calling, the Facebook iPad app and other big issues, such as security.

Last April, social game maker Zynga opened an office in Seattle’s historic Pioneer Square neighborhood, hoping to absorb some of the game talent here, spawned from Xbox and Nintendo, and cloud-computing knowledge from Amazon. It has 50 employees today, but declined to say how many it planned to hire in the near future.

As with most of these companies, eBay believes it can find a diversity of talent here that can’t always be easy to hire in the Bay Area.

As a Seattle native, and having covered tech here for the past 12 years, including an eight-year stint at the Seattle Times, I might not be the most unbiased on the subject. But I’ve seen first-hand the breadth of talent here, from Microsoft, Amazon, Expedia, T-Mobile and many others, including a strong start-up pool.

Despite that, the local tech community often suffers from an inferiority complex when it compares itself with the Bay Area, which is much larger. Still, it seems that Silicon Valley companies are finding a number of excuses to travel north to drink from the area’s plentiful tech waters.

Through many years of working together, first at eBay and then during the failed California governor’s race, Meg Whitman has relied heavily on Henry Gomez for communications advice.

Their close working relationship even earned them the mash-up nickname among those at eBay and elsewhere: Menry.

So when she got the CEO job at Hewlett-Packard, it was a bit of a surprise that Gomez — who has recently been living on the East Coast (see baseball cap above) — helped out a lot, but was not named to the top PR slot at the tech giant.

No longer, it seems, with Gomez being named EVP and Chief Communications Officer at HP today.

It’s a big job, given the hard work that Whitman faces reviving the iconic tech company, which has been beset by strategic and business challenges of all kinds, shapes and sizes in recent years.

While it might be seen as an adjunct to the business, the forward-facing parts of HP are in need of a powerful public relations initiative, which is presumably why Whitman wanted one of her most trusted and longtime staffers in the post.

According to HP, Gomez will become a member of the company’s executive council and report directly to Whitman.

Said HP in its press release, which you can also read below: “Gomez will be responsible for HP’s media and industry analyst relations, executive communications, employee communications, government affairs and global social innovation.”

As in, the voice of Menry is back!

Here’s the release:

HP Names Henry Gomez Executive Vice President and Chief Communications Officer

PALO ALTO, CA, Jan 10, 2012 – HP today announced that Henry Gomez will join the company as executive vice president and chief communications officer.

Gomez also will become a member of HP’s executive council, reporting to Meg Whitman, HP president and chief executive officer.

In this newly expanded role, Gomez will be responsible for HP’s media and industry analyst relations, executive communications, employee communications, government affairs and global social innovation.

Gomez, 48, comes to HP with 26 years of communications experience. He spent most of the last decade working at eBay, where he served in a variety of roles including senior vice president for Corporate Communications and president of Skype. Gomez played a crucial role in building eBay’s brand during the critical years following the company’s initial public offering.

Prior to joining eBay, Gomez was vice president of Corporate Affairs at HBO in New York. He started his communications career at Hill and Knowlton and has worked on a wide array of public relations and marketing communications challenges in numerous industries.

Most recently, Gomez ran his own consulting business, providing communications counsel to clients such as H&R Block. He was on the leadership team of Whitman’s 2010 campaign for governor of California and has been involved in government and political affairs throughout his career. In 2011, Gomez was appointed to the board of BJ’s Restaurants, Inc. He is a graduate of Boston College.

“Henry is an excellent manager and communications executive,” said Whitman. “People around the world care deeply about HP, and I believe we have an important obligation to clearly explain where we’re headed and why. Henry will work closely with the entire leadership team to make certain customers, partners, employees, and shareholders fully understand our vision and strategy.”

About HP HP creates new possibilities for technology to have a meaningful impact on people, businesses, governments and society. The world’s largest technology company, HP brings together a portfolio that spans printing, personal computing, software, services and IT infrastructure to solve customer problems. More information about HP is available at http://www.hp.com .

If you thought things were going to quiet down with Yahoo now that it has installed new CEO Scott Thompson in place, think again!

That’s because of a very unusual — well, to be fair, unusual for most companies, but not for perpetually storm-tossed Yahoo — confluence of important events about to take place all at once over the next six weeks.

And, like a very dicey game of corporate Jenga, each has the ability to upend and impact the other significantly, either for the good or, well, for the bad.

Here are the four horsemen of the possible Yahapocalypse, all riding into town very soon:

Q4 Results: Yahoo will report its fourth quarter earnings on January 24th, after the markets close. While sources said the company has managed to turn around what was looking like a first-class disaster, it’s still not going to be a pretty picture when it comes to advertising growth, consumer engagement and other key metrics.

Simply put, Yahoo needs to show investors a fast-growing business. Instead, sources said the Q4 results will likely come in at the bottom of the expected range, which should be unimpressive, even though this has been business as usual at Yahoo for some time.

If Google and others have strong reports, of course, it will make the situation worse.

Along with goosing its ad business again, Yahoo needs to spur innovation and intro some cool new products in new arenas to make Silicon Valley and others perk up.

Proxy Fight?: Weak results will give a nice lift to potential efforts by activist investor Daniel Loeb of Third Point — a major Yahoo shareholder — to wage a proxy fight for control of the company. He’s already here in Silicon Valley this week searching for possible board members for an alternate slate of directors.

As I wrote earlier today, the earliest nominations for directors can be submitted is February 24. Loeb then has a month after that to submit a competing roster.

Worse for Yahoo, many of Yahoo’s major investors are mulling backing Loeb if he initiates a battle for control of the company.

There’s no doubt that Loeb is and means to be a thorn in Yahoo’s side — he already made a lot of noise about its consideration of partial investments from private equity firms, due to low share prices — until major changes take place at the company.

And by major, Loeb’s intent seems to be along these baseball lines: Throw the bums out!

Board in Flux: Speaking of the board, it’s not the pretty picture of solidarity as you might think.

Actually, no one in their right mind thinks that. This board is about as dysfunctional as they come. (It’s like that group on “American Horror Story,” minus the bald dwarf in the basement.)

Right now, several sources report, various factions are jockeying over which board members go and which stay. The Wall Street Journal reported last week on a formal search for new board members to replace outgoing ones, but it’s much more complex than just that.

While some departures seem most obvious — longtime board members Vyomesh Joshi, Arthur Kern and Gary Wilson — the really interesting part will be the possible exit of Chairman Roy Bostock.

While it now is more of a when rather than an if, many sources report, how it goes down is the key part of the move. And who will be the chairman then will be the big conundrum — either an internal candidate, such as David Kenny, or a fresh-eyed outsider.

Another question mark: Whether co-founder Jerry Yang could also move along off the board with Bostock. While Internet company founders usually stick on boards, it’s not a given, especially with all the turmoil at Yahoo, some of which is related to Yang.

For now, make no mistake, Bostock is still in charge of the board and Yang is the only real power behind that power, despite the recent influence of director Brad Smith.

But, with all the pressure by shareholders, some sources suggest that it might finally be time for some significant change at the board level, starting with the pair most associated with all its troubles.

Or, um, not.

If there is going to be any action at all, expect it before February 24th — when Loeb can start making real trouble.

Asian Solution: A lot of the above hinges on whether Bostock and Yang can deliver the promise of a deal with its long disgruntled Asian partners, Alibaba Group and SoftBank.

The trio is now engaged on negotiations about a tax-free deal, in which Yahoo would sell back some of its stakes in its Asian properties and get money and other operating assets in return.

While it’s good news that the talks are finally proceeding with some level of normal functionality, it’s still a complex situation and one with a lot of outstanding questions.

Most important: Which operating assets will be bought in the deal to hand over to Yahoo? And also, what will the valuations be?

Sources close to the situation said that the talks remain slow-going and frustrating — “The stop-and-go of all time,” joked one person involved. But they are moving forward, which is no small thing when it comes to these three.

That’s critical for Yahoo, which can ill afford to disappoint shareholders if no lucrative, cash-rich deal happens in Asia. And, it needs to happen before Loeb can act on a proxy fight too, since a successful end to its Asian issues will negate his momentum dramatically.

Oh Yeah, Running the Core Business Stuff: As usual, a full and fraught month for Yahoo and its directors, who have other things to do, I assume.

But not me and not new CEO Thompson. By the way, the former eBay exec will presumably be very busy doing some significant rejiggering of the core Yahoo business in the meantime.

Could that mean a new product direction for Yahoo, for example, around data? Could it mean a passel of new execs? Could it mean layoffs?

Or, could it mean Thompson will finally solve the ultimate sword-in-the-stone question: What is Yahoo?

And that, in the end, will be the real victory.

When you own a large chunk of a major Silicon Valley Internet company, it’s probably not a surprise that you want to come to the center of the tech world to have a look around.

But Yahoo — of which Third Point’s Daniel Loeb owns over five percent — is unlikely to get a visit from the activist shareholder, who is in California this week.

Several sources said he has contacted many former Yahoos and other tech execs for meetings in the Internet heartland to chitchat about digital issues.

And, of course, search for possible board members for an alternate slate of directors, in case he decides to wage a proxy fight against Yahoo.

The earliest nominations for directors can be submitted is February 24 for those “shareholder proposals not intended for inclusion in proxy materials and for nomination of director candidates,” according to Yahoo’s corporate bylaws on such matters.

Loeb then has a month after that to submit a competing slate. In addition, many of Yahoo’s major investors are mulling backing Loeb if he initiates a battle for control of the company.

But it’s not a definite move as yet. The New York-based investor has not decided whether he will take on a proxy fight, sources said, given he has yet to assess Yahoo’s new CEO, former eBay exec Scott Thompson.

Thompson was president of the online commerce site’s PayPal payments division.

But while there is a formal process, you will hear a lot of noise coming long before that, unless Yahoo gives Loeb board seats to quiet him down — which is unlikely but possible.

Such an ugly fight is not one Yahoo can afford to have, and it has already shown some cloddish sensibilities in its response to a recent letters by Loeb asking for the ouster of its Chairman Roy Bostock and co-founder and director Jerry Yang.

But given how badly the last Yahoo shareholder tussle with Carl Icahn went, another proxy battle could be deadly, and might drag on through the first half of 2012. In his Yahoo tussle, Icahn ultimately got three seats on the Yahoo board, but eventually went away with everyone the poorer.

And no one wants a replay of that.

I love talking points as much as the next person, but there’s a striking similarity between recent statements by Yahoo’s co-founder and former CEO Jerry Yang and its new CEO Scott Thompson, who was just hired after a stint running eBay’s PayPal unit.

It seems from the pair that the exploitation of Yahoo’s troves of data might take center stage from the “premier digital media company” moniker that the Silicon Valley Internet giant has been using of late.

Premier consumer data mining and usage company just rolls off the tongue, doesn’t it? (And it’s also usually called Google!)

Here’s Yang from an interview with Walt Mossberg at our AsiaD conference in Hong Kong this past October (this is a liveblog with quotes and paraphrasing of quotes).

Q: As you look at what Yahoo could be, what are the one or two key areas that it could go after to truly transform itself?

Jerry: We’re really focused on trying to “turn Yahoo inside out.” We do a huge amount of services internally: Data, content, personalization. Lots of other people on the Web around the world could use that.

And, from my liveblogging, here’s Thompson last week on his aspirations, which were much less focused on Yahoo’s longtime — and, ahem, bill-paying — advertising business (which the new leader keeps saying he knows nothing about) than on exploiting its consumer data businesses (which he certainly does know about from running the online payments giant).

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

Data it is, then!

Here’s the deal for new Yahoo CEO Scott Thompson, who left a job running eBay’s PayPal:

Annual pay: $1 million.

Bonus (if he’s very, very good): $2 million.

Bonus (even if he’s not): $500,000

Stock grant: $11 million.

One-time inducement grant: $5 million.

Make-whole cash bonus: $1.5 million

Make-whole restricted stock units: $6.5 million.

Shareholder horror if it doesn’t work this time: Priceless!

Oh, just read it for yourself:

YHOO-20120106-8K-20120103

In a note sent to investors today, Gil Luria, an analyst at Wedbush Securities, was the first to disclose the relationship between the eBay-owned company and Home Depot.

“We speculate that Home Depot may be one of the first retailers to roll out PayPal at the point of sale,” Luria said.

In a statement, a PayPal spokesperson confirmed the partnership: “We frequently run trials with our retail partners. In this case, PayPal and The Home Depot are engaged in a limited pilot program for new POS technologies. The pilot is currently being run in five stores and involves a small number of PayPal employees.”

Home Depot is obviously a huge win for PayPal, which until now had only provided online payment solutions to customers.

The pilot, which went live in December, allows employees to pay for items at the register using a PayPal-issued credit card or by entering their mobile phone number into the point-of-sale device at the register. Neither solution uses near field communication, which can be a limiting factor for adoption.

More pilots are expected to take place early this year, but PayPal has been reluctant to name its partners, because it wants the retailers to be the ones to make the announcement when they are ready.

On Wednesday, Yahoo officially announced that it had hired PayPal President Scott Thompson as its new CEO, shocking executives at eBay, including CEO John Donahoe.

In an interview, Donahoe downplayed Thompson’s role in the company’s emerging mobile payments business by saying that the whole team participated heavily in the 2012 plan.

Wedbush’s Luria concurred: “We do not believe Scott Thompson was instrumental to the Mobile Payments vision. It is our impression that although ‘Paypal at the POS (point of sale)’ was led by PayPal management, the holistic mobile payments vision was driven at the eBay Inc. level.”

On Wednesday, eBay’s stock sank nearly 4 percent to close at $30.16. Today, it closed at $30.63.

Luria has an “outperform” rating on the eBay stock, and a 12-month price target of $48 a share.

Here’s the news that came out of a meeting that newborn Yahoo CEO Scott Thompson had yesterday afternoon with the VP-and-above staff of the Silicon Valley Internet giant:

No. 1: Yahoo is both a media and tech company.

No. 2: His focus for the next four weeks will be internal meetings and getting to know the staff.

No. 3: Thompson uses the following Yahoo products — email, finance and news.

No. 4: He is very good at explaining what eBay’s PayPal — where he just served as its president — is.

“If he can do that, maybe he can let us all finally know what Yahoo is, too,” joked one VP, referencing the well-known difficulty Yahoo’s CEOs have had with clearly defining the company’s mission.

But Thompson — whom every single person I spoke to called a “nice guy” — declined to say much about the stuff everyone really wanted to know, from the Asian assets (no comment!) to the possible investments by private equity firms (no comment!) and more (no comment!).

Most VPs I interviewed seemed to have a wait-and-see attitude about Thompson, who is not the kind of high-profile hire some had expected. Of prime worry: The steep learning curve he might have, in a time that requires urgency.

“He’s not the game-changer, but he seems very competent,” said another VP. “We’ll see.”

Indeed, we will. And, to start, Thompson is on display for the entire Yahoo staff at an all-hands employee meeting on Yahoo’s Sunnyvale campus, which is taking place right now.

More to come on that soon, as my embeds call in reports! (Was my invite lost in the mail? Not very nice!)

In an interview this afternoon, eBay CEO John Donahoe confirmed that it was indeed a “shock” — as he wrote to staff in a memo — after returning from a long New Year’s weekend, to learn that the head of one of the online commerce giant’s key divisions, PayPal President Scott Thompson, was leaving to be CEO of Yahoo.

With only 15 hours’ notice before the planned announcement this morning by Yahoo — and even earlier, given that AllThingsD.com scooped the news last night — Donahoe had no time to inform the company, especially those working at PayPal.

Still, he was as cordial as he could be, given the circumstances.

“Scott is a great guy, and he did a great job at PayPal, and I am one of his biggest supporters,” said Donahoe — known at the company for his even-handed demeanor — despite being blindsided by the longtime eBay exec and also Yahoo. “I told him, ‘I hope you are very successful at Yahoo.’”

But the eBay leader, who noted that he prefers to avoid corporate drama, shrugged off the suggestion that there would be any animosity going forward with Yahoo.

“It’s not the timing that I would have liked. It would have been nice for him to be able to tell the team, but that’s neither here nor there,” Donahoe said. “It’s no big deal.”

He also said he’s not holding a grudge against Thompson.

“Scott wanted to be a CEO, and that’s great. He felt the opportunity wasn’t going to come along again. He had the best non-CEO job in the world, but he wanted to be a CEO, and wanted to go for it,” said Donahoe. “I get that, and there’s not that many CEO jobs coming up.”

Still, after the news broke, one senior Yahoo leader joked to AllThingsD that he was afraid to call Donahoe.

Indeed, now that Yahoo has nabbed Thompson from its crosstown Internet peer, Donahoe will have to move fast to fill the exec shoes now abruptly left empty.

That’s especially true since Thompson’s departure is occurring at a most inopportune time.

First the good news: The digital payments division, which has been the bright spot at eBay, is on target to have a record 2011 performance, and is set to roll out several significant initiatives this year.

But the big item on PayPal’s agenda is daunting, too: To challenge both incumbent payment providers, along with new entrants, such as Google, by creating a digital wallet that can be used for physical payments at retail.

Nonetheless, the most pressing order of business, obviously, is that Thompson will have to be replaced.

And that’s no small task. The seven-year PayPal veteran has a deep knowledge of the digital payments market, and has a track record of success. PayPal has continued on a breakneck pace over the last couple of years, with the division’s revenue now on track to surpass that of eBay.

In addition, Thompson — often described as likable with an easy-going personality — was the company’s most visible cheerleader on payments, eagerly talking to major retailers and convincing them to get on board with its next generation of services.

Now, while PayPal has a plan and a budget for 2012, there is currently no sole person to implement the vision.

Donahoe, who will head up PayPal in the interim, said he addressed the PayPal executive team in a meeting this morning, in an effort to keep the momentum going.

“I got together with the team this morning and we spent a couple of hours together. Rest assured that they are driving ahead collectively to implement the plan that they helped put together over the last year,” Donahoe said. “They have a clear set of 2012 priorities, and they are excited.”

He added: “There was a shock in the morning, but by noontime, it was full speed ahead.”

As an example, Donahoe said eBay had already reassigned five of the company’s top 15 strategic accounts that Thompson was responsible for. Donahoe will take a couple of those, as will eBay CFO Bob Swan, and Devin Wenig, president of eBay’s Marketplaces unit.

But make no mistake, there needs to be a Thompson replacement, and quickly.

PayPal does have a deep bench of executive talent, and any number of senior executives could step up to take the role, although it’s also likely that eBay will conduct an external search before coming to that conclusion.

“I won’t worry about what’s next until we’ve made it a couple weeks into the year and are hitting our milestones,” said Donahoe, who noted that the company’s vision was shared by the management team, and even though Thompson was the one communicating externally, “It was not a one-person plan whatsoever.”

Donahoe declined to elaborate any further on how eBay would conduct a search.

Thompson’s direct reports and key leaders include:

Ed Eger, SVP and GM of North America, core payments and emerging markets; John McCabe, SVP of worldwide operations and customer service; Patrick Dupuis, CFO; Gary Marino, SVP of credit products and risk, who joined through the acquisition of Bill Me Later; Mark Lavelle, VP of strategy and business development, also from Bill Me Later; Rupert Keeley, SVP of Asia Pacific; Sam Shrauger, VP of global product and experience; James Barrese, VP of product development; David Marcus, VP of mobile, who joined through the acquisition of Zong; and Ranjana Clark, SVP and chief customer and marketing officer.

And there is a fairly long list of companies for eBay to attempt to cherry-pick from.

One obvious company is Amazon, which has a competing payments division. If PayPal could legally pull it off, Matt Swann, VP and general manager of payments of Amazon, would be a prime candidate to run the company.

There are also other companies with payment talent — many of which are also situated near eBay in Silicon Valley — including Apple, Google, Facebook, VeriFone, Intuit and the traditional payments providers, such as Visa, MasterCard or American Express.

While analysts viewed Thompson’s departure as a negative, they were still largely optimistic about PayPal’s future.

Colin Sebastian of Baird Equity wrote in a note to investors that “the core PayPal consumer value proposition remains strong, in our view, and remains well positioned for long-term growth.”

Citi Analyst Mark Mahaney pointed out that Thompson’s departure comes on the heels of a number of PayPal executive departures, including Stephanie Tilenius and Osama Bedier, both of whom left for Google; and Lorrie Norrington, who left eBay for personal reasons.

Still, eBay’s stock dropped $1.18 a share, or nearly 4 percent, on the Thompson news, to close at $30.16.

It is interesting to note that eBay’s market cap hovers close to $40 billion, which is still twice Yahoo’s market valuation.

Yahoo actually let me talk with its new CEO Scott Thompson this morning, after the company announced it had hired him as its latest leader.

In an interview, the man who is leaving a job running eBay’s large and lucrative PayPal online payments unit was affable and — dare I say it — seemed very sweet, as well as gung ho on Yahoo’s prospects going forward.

Joking about how he took the job only because eBay and Yahoo are located close by each other in Silicon Valley and the commute was just as easy, Thompson opened by noting that those working at the online commerce giant have always had a “keen appreciation for what each other was doing.”

He said that when he was approached in November about the Yahoo job, although sources said it was just offered this week and took eBay by surprise.

Still, soon after being contacted by Yahoo’s exec recruiters, Thompson said he began “exploring in more detail what’s actually here.” As he did so, he added, he “became progressively more fascinated” that Yahoo had more promise than has been assumed in recent years.

“Its potential is still enormous, but the dialogue has not been about what the company is,” Thompson said. “I want to get this wonderful brand to where it could be again … so, as a starting point, this is a great starting point.”

Thompson’s premise is based on his belief that we are still in the early days of the Internet. And, because he is a Boston native — making him, of course, an ardent fan of its beloved Red Sox — he used baseball as a metaphor.

“It’s early innings, and there are the next eight innings in front of us,” he said, noting that he was in the stands with his father when catcher Carlton Fisk hit that famous game-winning home run in the 12th inning of the sixth game of the World Series in 1975.

Note to everyone who is not an obsessive fan like Thompson (and also, I might add, Walt Mossberg): It did take the Red Sox from 1918 to 2004 to actually finally win the Series again, so maybe Yahoo has a chance!

“This remains a great business, and I have no doubt its best days are ahead of Yahoo,” said Thompson, in that same hopeful spirit of this-year’s-gonna-be-the-one.

Thompson noted that he is fully cognizant of the major troubles at the company recently, and had a “real sense of urgency, but not by moving at breakneck speed, because you just do bad stuff faster.”

Instead, he said, he hopes to focus Yahoo the same way he did PayPal, by innovating, making commitments and keeping them, and overperforming.

None are easy tasks, and all have stymied Yahoo in the recent past. Thompson said that he thinks it might be because of not focusing equally on both consumers and Yahoo’s partners and advertisers.

He admitted that his lack of advertising experience was clear — it could be problematic, because it’s Yahoo’s biggest business — but said, “I readily admit what I don’t know, and am ready to learn and rely on Yahoo’s great team.”

While he would not go into deep specifics — Thompson does not start until next week — he said he planned to get some basic grounding, noting, “I have no preconceived notions.”

One thing is clear, said Thompson: “I can assure you I am going to be completely different.”

If that means doing what Fisk did, that would certainly be a home run for Yahoo.

Thompson, who is currently in charge of one of eBay’s fastest-growing divisions, PayPal, will start at Yahoo next week.

This morning, we got our hands on the internal memo that eBay’s CEO John Donahoe sent out to the troops.

In the letter, which is posted below, he called the move a “shock” to him and the company. But Donahoe has known about Thompson’s talks with Yahoo for a while, but was apparently surprised that he had been hired and only found out yesterday, as he noted in the letter below.

Thus, Donahoe will fill Thompson’s position temporarily, until a transition plan is in place.

Thompson’s departure is notable because he was arguably leading one of the more important initiatives inside San Jose-based PayPal.

In a recent interview with me, Thompson said: “We are doing something so big that it will change the face of payments.”

Well, apparently, he’s found something larger to bite off.

Thompson’s departure will likely be seen as a significant blow to eBay.

At the time of our conversation, Thompson had just addressed 150 merchants at a PayPal event in Los Angeles that included big names like Home Depot and Sports Authority. He spent the week convincing them that PayPal was their next big partner for online and in-store payments.

Over the past year, eBay has been restructuring its core shopping experience online, while nurturing its rapidly growing digital payments business. The timing couldn’t be worse. Right as mobile payments is destined to take off, PayPal has a magical combination of assets, consisting of contacts with the retailers, the technology, and an impressive base of customers already using its services.

At the same time, a host of other challenges are going after the space, like Google, the wireless carriers and the traditional payment companies.

PayPal has also struggled with retaining top talent, losing two executives to Google, so Thompson’s departure won’t help its reputation in that department.

Donahoe pledges that the impact of Thompson leaving will be limited: “We will not miss a beat. And we will continue driving the incredible momentum that each of you has helped to create.”

This morning, eBay’s stock is trading 3.4 percent lower at $30.23 a share.

Here’s Donahoe’s full letter:

To all PayPalians,

As you may already have seen, Yahoo! announced this morning that Scott Thompson is joining the company as CEO, effective immediately. Scott informed me Tuesday afternoon, saying that despite his passion for PayPal, this was an opportunity he felt he had to take. I know I speak for everyone in wishing Scott the best.

I will serve in the interim role as President and will be meeting with the PayPal leadership team this morning to plan a seamless transition. And while I’m sure Scott’s decision is a shock to many of you, as it was to me, there is one thing I am certain of: PayPal has an enormous opportunity in front of it and we will not slow down. We will not miss a beat. And we will continue driving the incredible momentum that each of you has helped to create.

PayPal had an outstanding 2011 and a strong close to the fourth quarter. PayPal’s vision is clear. Our strategies are set and we have a strong, focused leadership team in place. And across PayPal, we have you — an incredibly talented team, committed to creating the future of money and changing how the world shops and pays.

Let’s do it, and take this special business to the next level in 2012 and beyond.

John

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

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

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

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

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

Here we go!

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

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

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

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

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

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

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

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

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

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

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

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

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

7:09 am Q&A time already.

Congrats from the Wall Street analyst peanut gallery.

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

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

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

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

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

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

Roy — that’s who!

7:15 am: Another analyst asks about margins.

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

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

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

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

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

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

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

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

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

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

Thus:

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

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

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

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

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

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

“It’s a moot point,” he says.

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

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

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

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

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

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

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

He also loves mobile — which Yahoo has largely borked.

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

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

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

Thompson promises that he will be a “sponge.”

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Plus, he is a genuine Internet geek.

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

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

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

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

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

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

YHOO_News_2012_1_4_General