Yahoo beat Wall Street estimates in its first-quarter earnings report today, with revenue of $1.08 billion and earnings of 23 cents. That’s a gain of 28 percent from a year ago in net earnings and 38 percent per diluted share.

Analysts had been expecting Yahoo to report revenue of $1.06 billion and earnings of 17 cents a share. But, as I reported earlier today, sources had indicated that the results would be on the upside.

Still, revenue was only up year over year by 1 percent — not exactly a great achievement, given exploding growth across the Internet industry. The real drag was the Europe, Middle East and Africa regions, whose revenue was down 9 percent — which Yahoo attributed to the weak economy there — with its “contribution” down 27 percent. That region has been run by Rich Riley, who is now Yahoo’s sales lead in the U.S.

One interesting note: While display revenue was down, search revenue was up. And unique visitors to Yahoo were up 7 percent, which was lower growth than in previous quarters. The reason was declines in search and communications, with media up strongly.

Now, investors are hoping to get more clarity from new CEO Scott Thompson in a call at 2 pm PT about the overall strategy for the troubled Silicon Valley Internet giant, which just restructured its management again and also had layoffs of 2,000 employees.

Thompson has yet to articulate a specific plan beyond the broad strokes of media, commerce and data/platforms as Yahoo’s aim.

But there is a lot more to deal with and in detail, including figuring out its troubled advertising search partnership with Microsoft, the talks around selling off parts of the company’s lucrative Asian assets, Yahoo’s patent lawsuit against Facebook, how Yahoo is going to deal with activist shareholder Third Point’s possible proxy challenge and whether more layoffs beyond recent firings will be needed.

“In the first quarter, Yahoo!’s results came in at the high end of our guidance range and beat consensus on revenue and profits,” Thompson said in a statement. “We also made changes to resize the organization and establish a new leadership structure to quickly deliver the best user and advertiser experiences at scale.”

Until Thompson gives more deets on the earnings call, which I will be liveblogging, here’s Yahoo’s official press release and cool charts on the subject:

YHOO News 2012-4-17 General

YHOO_Q112EarningsPresentation

In a move that AllThingsD had previously reported was coming, Yahoo said it had laid off 2,000 employees, or 14 percent of the workforce.

“Today’s actions are an important next step toward a bold, new Yahoo! — smaller, nimbler, more profitable and better equipped to innovate as fast as our customers and our industry require,” said Yahoo CEO Scott Thompson in a statement. “Unfortunately, reaching that goal requires the tough decision to eliminate positions.”

While Yahoo has had periodic layoffs over the years, this one is its most significant in its history, and will also result in another large-scale restructuring of the management organization. More cuts are also likely to follow in the months ahead, due to the reshaping of Yahoo.

The latest employee action is being pushed by Thompson, who joined the Silicon Valley Internet giant in January from eBay’s PayPal unit.

“Change is never easy,” he wrote in an internal email to Yahoo employees (it is below in its entirety), in a well-worn cliché I am dead certain few appreciated hearing today from the top leader.

At an internal meeting with top staff last night, Thompson — who has gotten what seems to be a well-deserved reputation for chewing folks out at Yahoo — was more direct with the execs gathered, berating them extensively for not delivering and getting the company to this sorry point.

Ouch, Scott! It’s Easter, so it might be time for some forgiveness. (And no more ranting about my reporting to those inside Yahoo, since I have been 100 percent accurate so far. FYI, will aim for 110 percent next week!)

Yahoo said it will save about $375 million with the cuts, incurring a $125 to $145 million pretax cash charge for employee severance in its second quarter. Before the cuts, Yahoo had 14,000 staffers and has many thousands more hired as contractors.

The layoffs touch all units of the company, but the hardest hit is the product division, which is headed by Blake Irving, as well as its marketing, research and international units. Yahoo gave no details on the layoffs other than the number.

But the fate of two key parts of the soon-to-be-blown-apart unit — Yahoo’s advertising technology businesses, Right Media and APT, and its search business — is still being contemplated, as I have previously reported. Possible scenarios include a sale or a joint venture transaction for both, which employ thousands of Yahoo staffers.

The layoffs tomorrow are not the end of the road in cutting costs. Along with the likely shedding of its ad tech and search businesses, Yahoo leadership is also looking at future cuts as it evaluates current businesses, which could lop even more employees off its roster.

That said, Yahoo will be doubling down in some older and new arenas, so there would also be simultaneous hiring in the months ahead.

As wrenching as they will be today at Yahoo, the layoffs come as no surprise. Thompson had told employees in memos and also in recent meetings that “real change” was coming to the company.

Along with the trauma of the layoffs, Yahoo is also facing two other tense face-offs externally. In one, activist shareholder Third Point is waging a proxy fight for board seats and stepped up the public pressure this week; and Facebook struck back hard at Yahoo’s patent lawsuit with a counterclaim of its own.

After the layoffs tomorrow, sources say Yahoo will be announcing a new organization by next week. Thompson, along with outside consultants he has hired from the Boston Consulting Group, are making what appear to be profound changes.

Sources said that Yahoo will most likely be comprised of a global media division, one that encompasses Yahoo’s consumer products businesses and one focused on global and regional sales. There could also be a small organization of about 50 employees aimed at future innovation.

Americas head Ross Levinsohn is pegged to run the media arm, which will also include its leads/commerce businesses, such as autos; Shashi Seth — who now heads search and marketplaces — is likely to run consumer products, which will include Yahoo’s communications and search businesses.

Yahoo has already been conducting a search for a new worldwide sales head, who will also be boss of the U.S., Asia and Europe, Middle East and Africa sales regions. Rich Riley, who was recently running EMEA, is reportedly the pick for U.S. sales; Rose Tsou, who is running Asia, would presumably stay put; Yahoo is looking for an EMEA sales lead.

Some current operational execs — such as service engineering and ops head David Dibble, CFO Tim Morse, and top lawyer Mike Callahan — are likely to continue to operate as before.

One big question mark is how Chief Product Officer Irving fits in the possible new org, in which the new units get control of their product development. Irving has reportedly had several incoming job offers, although it is not clear if he has responded to that interest.

But today, the focus is on the layoffs and letting go all those employees, many of whom have worked at Yahoo for years. Even if it will result in a stronger Yahoo, as Thompson promises, it is still a very sad day in Sunnyvale.

Here is a video on the topic that I did with the WSJ.com “Digits” show today, after the cuts were announced early this morning:

Here’s the entire terse statement from Yahoo:

Yahoo! Statement

SUNNYVALE, Calif. — (BUSINESS WIRE) — Yahoo! today confirmed that it is taking important next steps to reshape the company for the future.

“Today’s actions are an important next step toward a bold, new Yahoo! — smaller, nimbler, more profitable and better equipped to innovate as fast as our customers and our industry require. We are intensifying our efforts on our core businesses and redeploying resources to our most urgent priorities. Our goal is to get back to our core purpose — putting our users and advertisers first — and we are moving aggressively to achieve that goal,” said Scott Thompson, CEO of Yahoo!. “Unfortunately, reaching that goal requires the tough decision to eliminate positions. We deeply value our people and all they’ve contributed to Yahoo!.”

Yahoo! has a solid foundation — nearly 700 million users and thousands of advertisers that engage with Yahoo! properties regularly and trust the company with their data and their business. Through its restructuring efforts, Yahoo! intends to grow by responding more quickly to customer needs and competing more effectively in areas where it can win. Yahoo! has identified key parts of the business — a select group of core businesses, the platforms that support those core businesses, and the data that drives deep personalization for users and ROI for advertisers — where the company will intensify efforts and redeploy resources globally, all focused on increasing shareholder value. With a clear focus on profitability and growth, the company will be disciplined in its investments and radically simplify how it builds, launches and maintains many of its properties and products.

Today, the company will begin the process of informing employees about these changes. As part of that effort, approximately 2,000 people will be notified of job elimination or phased transition.

Yahoo! expects to realize approximately $375 million of annualized savings upon completion of all employee transitions. The company currently expects to recognize the majority of an estimated $125 to $145 million pretax cash charge relating to employee severance in its second quarter financial results. The company may incur additional charges in connection with this action. More information will be provided about Yahoo!’s future direction in conjunction with the release of its first quarter financial results on April 17, 2012.

And here is Thompson’s memo to employees, stating the obvious and with nothing new from previous statements and internal memos:

Yahoos –-

Today we are restructuring Yahoo! to give ourselves the opportunity to compete and win in our core business. The changes we’re announcing today will put our customers first, allow us to move fast, and to get stuff done. The outcome of these changes will be a smaller, nimbler, more profitable Yahoo! better equipped to innovate as fast as our customers and our industry require.

Over the last 60 days, we’ve fundamentally re-thought every part of our business and we will continue to actively consider all options that allow Yahoo! to put maximum effort where we can succeed. As part of this process, I believe we have to focus to win in a select group of core businesses globally:

Core Media and Communications: Our content, media, and communications experiences must be best in class. That includes getting today’s core properties right and innovating on a next generation of great product experiences across all screens.∙

Platforms: We must make our core platforms and systems a genuine strength for Yahoo! — platforms that we can really leverage to support our massive scale, drive the deepest personalization, and boost speed to market.∙

Data: Our massive data sets must become a genuine competitive advantage for Yahoo!. We have to unlock the value in our data to allow us to really understand our 700 million users, encourage and win their engagement and trust, leverage everything they do with us to more fully personalize their experiences, and to give our advertisers the immediate insights they are rightfully demanding.

We are intensifying our efforts on our core businesses and redeploying resources to our most urgent priorities. Our goal is to get back to our core purpose — putting our users and advertisers first -– and we are moving aggressively to achieve that goal.

Unfortunately, reaching that goal requires the tough decision to eliminate jobs, which means losing colleagues and parting with friends. Today, we will begin the process of informing employees about these changes. As part of that effort, approximately 2,000 people will be notified of job elimination or a phased transition. We value our people and for those who will be leaving, we thank you for all you have contributed to Yahoo!. We will treat all of our people with dignity and respect, providing resources to help manage through their transition.

Change is never easy. But the time has come to move Yahoo! forward aggressively with increased focus and accountability. Our values have always been about treating all Yahoos with dignity and respect, and today is a day to embrace those values. This is an amazing company with exceptionally talented people and I know we will all do our best to encourage each other through this difficult period of transition.

Scott

According to sources close to the situation, Yahoo’s massive round of layoffs — which is likely to impact up to 2,000 employees — is just the tip of the proverbial iceberg that will hit the storied Silicon Valley Internet giant in the months to come.

Sources said Yahoo is currently planning to announce the cuts in staff in the early morning, just as the markets open. That could change, of course, but the cuts will definitely occur within the next two days.

The layoffs, which will touch all units of the company, are expected to hit hardest in the product division, which is headed by Blake Irving.

But the fate of two key parts of the soon-to-be-blown-apart unit — Yahoo’s advertising technology businesses, Right Media and APT, and its search business — is still being contemplated, as I have previously reported. Possible scenarios include a sale or a joint venture transaction for both, which employ thousands of Yahoo staffers.

Also set to be hard hit are Yahoo’s local businesses, as well as its marketing and research divisions. While still sustaining losses, its media units will not be as badly impacted. And it’s not clear how many employee terminations will be aimed at the company’s general and administrative staff.

The layoffs tomorrow are not the end of the road in cutting costs. Along with the likely shedding of its ad tech and search businesses, Yahoo leadership is also looking at future cuts as it evaluates current businesses, which could lop even more employees off its roster.

That said, Yahoo will be “doubling down” in some older and new arenas, so there would also be simultaneous hiring in the months ahead.

But not tomorrow, which will be one of the tougher days in Yahoo’s long history of periodic layoffs. Newly installed CEO Scott Thompson had told employees in memos and also in recent meetings that “real change” was coming to the company.

That is indeed the case, which is causing massive strain throughout the company, which now employs over 14,000 and has many thousands more hired as contractors.

Along with the trauma of the layoffs, Yahoo is also facing two other tense face-offs externally. In one, activist shareholder Third Point is waging a proxy fight for board seats and stepped up the public pressure this week; and Facebook struck back hard at Yahoo’s patent lawsuit with a counter-claim of its own.

After the layoffs tomorrow, sources say Yahoo will be announcing a new organization by next week, which will create several major, soup-to-nuts units at the company. Thompson, along with consultants he has hired from the Boston Consulting Group, are making what appear to be profound changes.

Sources said Yahoo will most likely be comprised of a global media division, one that encompasses Yahoo’s consumer products businesses and one focused on global and regional sales. There could also be a small organization of about 50 employees aimed at future innovation.

Americas head Ross Levinsohn is pegged to run the media arm, which will also include its leads/commerce businesses, such as autos; Shashi Seth — who now heads search and marketplaces — is likely to run consumer products, which will include Yahoo’s communications and search businesses.

Yahoo has already been conducting a search for a new worldwide sales head, who will also be boss of the U.S., Asia and Europe, Middle East and Africa sales regions. Rich Riley, who was recently running EMEA, is reportedly the pick for U.S. sales; Rose Tsou, who is running Asia, would presumably stay put; Yahoo is looking for an EMEA sales lead.

Some current operational execs — such as service engineering and ops head David Dibble, CFO Tim Morse, and top lawyer Mike Callahan — are likely to continue to operate as before.

One big question mark is how Chief Product Officer Irving fits in the possible new org, in which the new units get control of their product development. Irving has reportedly had several incoming job offers, although it is not clear if he has responded to that interest.

Let’s hope that Yahoos who will be let go tomorrow find themselves with many new employment choices after the ax falls.

Yahoo is preparing to begin layoffs of what could be thousands of employees starting next week, according to multiple sources, and is then expected to announce a new restructuring of the company the week after.

The swirl at the Silicon Valley Internet giant has grown more intense this week, as new CEO Scott Thompson has brought in top management for a series of meetings both Tuesday and Wednesday to outline the plans.

What has emerged — although sources noted that Thompson and others communicating the pending changes said nothing was yet set in stone — is the picture of a drastically slimmed-down organization with a focus on media, advertising and new but unclear “future” initiatives.

First the layoffs: Sources said the cuts will be deep and mostly aimed at the product, research and marketing units of Yahoo, which are likely to take place Wednesday. The ultimate goal, said multiple sources, is to cut many thousands from Yahoo’s staff of close to 14,000 employees, which is actually much larger, due to contract workers not officially in its roster.

The entire cut will not take place at once, said sources, since Thompson and others are still trying to figure out how to dispense with its ad technology org and, potentially, its search business. He has been in discussions with both Microsoft and Google about this, although there are other possibilities, too.

Both these parts of Yahoo together have about 2,500 staffers, whose fate is not yet sorted out.

Also still baking is the new structure, although sources said it is most likely to be comprised of a global media division, one that encompasses Yahoo’s communications and search businesses, and ones focused on global and also regional sales. There could also be a small organization of about 50 aimed at future innovation.

Americas head Ross Levinsohn is the likeliest exec to run the media arm, while Shashi Seth — who now heads search and marketplaces — would be the obvious candidate for the the communications/search one.

Thompson has already been conducting a search for a new worldwide sales head, although one possible internal exec for the job could be Rich Riley, who was recently running Yahoo’s Europe, Africa and Middle East region.

It is not clear how Chief Product Officer Blake Irving fits in the possible new org, since much of the development could now move to the decentralized units.

Some current operational execs — such as service engineering and ops head David Dibble, CFO Tim Morse, and top lawyer Mike Callahan — are likely to continue to operate as before.

Thompson, along with consultants he has hired from the Boston Consulting Group, presented the possible plan in front of Yahoo’s senior execs on Tuesday. That was followed by more meetings with a wider range of top management yesterday, although Thompson was not as highly specific in these meetings.

In fact, according to a half-dozen sources, Thompson apparently grew somewhat testy in one of the gatherings, when asked if there was a strategy he was going to announce in more detail to the group.

(Dear Scott, these are very talented employees who love the company and who have been through the wringer and it’s not their fault that leadership has failed them, so it might be a good idea to treat them with as much respect as possible right now.)

More to come, obviously.

Earlier this week, Rich Riley — the nattily dressed SVP and managing director of Yahoo’s EMEA (Europe, Middle East and Africa) region — sent an email to his staff that he was stepping down from that top role at the company.

But, unlike other high-ranking execs who have departed the Silicon Valley Internet company of late, Riley wrote: “I sincerely hope to remain with Yahoo! once the transition is complete and am working with [CEO Scott Thompson] and team to find my next big challenge.”

Leave it to Rich to be novel! (My sincere hope is that he’ll be bringing those slim-cut Zegna blazers to Yahoo’s Sunnyvale HQ.)

Here’s the entire Riley goodbye-to-Europe email below:

Hey Team,

I wanted to quickly update you on my personal plans. After an amazing 4+ years in London and Geneva, my wife and I have decided that it’s time to bring our European adventure to a close and move on to our next phase back in the US. We plan to move by the end of the summer in time for the kids to start the school year. As a family, we can’t believe we are going to leave such an amazing place, but those timeless forces of being close to family have led us to the conclusion that it’s time for us to move back. Professionally, I will find it so hard to say goodbye to this amazing team and this impressive business that we’ve built together.

Over the past four years we’ve fundamentally turned around this region. We figured out how to grow revenue and be a leading seller of display advertising and are now taking share in nearly every market in which we operate. We figured out that we had to get onto global product platforms to compete and that transition is nearly complete and our audience metrics are at all-time highs and growing rapidly. We figured out that there were huge opportunities in expansion markets and the Middle East and have executed against them. But most impressively to me by far is the team that we have assembled. A team that from country to country is seen as among the strongest in the market and has the highest morale of any team at Yahoo! I am very proud of this team and will miss you most of all.

The reason for communicating this now is that we need to start the search for my successor. We will search internally and externally with a clear mandate to find an amazing leader that can take our great business to the next level and grow revenues to $1 billion and beyond … The future for the EMEA Region is going to be fantastic.

As for me, I sincerely hope to remain with Yahoo! once the transition is complete and am working with Scott and team to find my next big challenge.

Until then, I’m 100% focused as always and we’ll have plenty of chances to say goodbye. It has been a true honor to work with all of you.

Best,

Rich

Yahoo’s massive product unit is readying a major reorganization, which will include a new structure, a move that is being spearheaded by its Chief Product Officer, Blake Irving.

But the ground under Irving, as well as several of the Silicon Valley Internet giant’s top execs, is about to get shakier too, due to a wide range of changes now being plotted by newly installed CEO Scott Thompson.

While still in the early stages of formulation, sources said Thompson has been mulling bringing in a head of global advertising sales or revenue chief, as well as more top product execs, as he moves to initiate a plan to shake up Yahoo and also put his own stamp on the company.

Layoffs and possible wholesale abandonment of certain businesses Yahoo is currently in are likely to be parts of this larger plan.

Confused yet? So am I, but let’s sort through all the latest activity.

First, there’s the Yahoo product redo, which has been in the making for a while, well before Thompson arrived last month.

Under the new plan, which is described as “an evolution rather than blowing up the place,” Yahoo’s famously matrixed product unit could be split into three distinct areas: Monetization, which is expected to be headed by longtime exec Mark Morrissey; platform, with cloud dude Jay Rossiter in charge; and consumer-facing products, possibly in the hands of search kingpin Shashi Seth.

The idea behind the latest setup, presumably, is to spur innovation and make it easier for Yahoo to spit out products more quickly. Its recent Livestand tablet app, for example, was late to the game and continues to struggle to gain any real ground, said sources.

Overall, Yahoo still continues to lag behind other Internet rivals in a number of product arenas, for reasons that Thompson is delving into.

The way products are made got a long look-see this past week, in a day-long meeting that Thompson had with Yahoo’s top team execs. Thompson reportedly quizzed the group on its plans, and pressed it to look less at short-term features and maintenance than on finding the next great thing.

“I think it’s fair to say that Scott is wondering why Yahoo did not come up with innovations like Pinterest and Instagram,” said one person about hot new start-ups that are in the sweet spot of Yahoo’s business. “Or, at the very least, why it did not even try to buy them.”

That’s why Thompson, with the help of board members, including David Kenny, has been on the hunt for new talent for Yahoo. That includes a search that is on for a new head of marketing, too.

Thompson has been doing the same kind of assessment with Yahoo’s media and advertising execs, who include Americas head Ross Levinsohn, as well as Asia’s Rose Tsou, and Rich Riley, who heads its efforts in Europe, Africa and the Middle East.

Sources said he believes that Yahoo might need a head of global sales or a chief of revenue to better organize and align its key advertising business. Ad revenues now make up a bulk of Yahoo’s business.

As Thompson has said numerous times publicly since he came on board, he is seeking to diversify that revenue, focusing on new businesses and also goosing non-ad ones already performing well. In Asia, for example, Yahoo has a robust online commerce business in comparison to other regions.

“Yahoo has to slim down and focus in some ways and bulk up in others,” said another source.

Of course, all of this might be moot, depending on how activist shareholder Daniel Loeb, who is prepping his own frontal attack on making changes at Yahoo, decides to move. According to sources, Loeb is assembling his own slate and trying to garner support from other shareholders, in hopes of further improving the value of his more than five percent stake.

What form that will take is unclear, but it’s not completely friendly at the moment.

In addition, Yahoo execs and its board are trying to wrap up a deal to sell off parts of its Asian assets in Alibaba Group and Yahoo Japan, part of a massive arrangement that could bring many billions of dollars of assets and cash into the core company that is left.

Which could then make Yahoo more able to compete, and give Thompson a war chest to do so — or make it an even tastier treat for a wide range of outside investors looking for a deal.

Like I said: Confused yet?

A Yahoo spokeswoman declined to comment.

Orange said it plans to roll out the free service over the course of 2012 to customers in 20 countries, with access in the first countries launching early this year. The service will be available on any phone with an Orange SIM card and the ability to view the mobile Web, with no data plan required.

“In countries where access to information is not always readily available, we are making it simple and easy for our customers to use the world’s most comprehensive online encyclopedia,” Orange Executive VP Marc Rennard said in a statement. “It is the first partnership of this kind in the world where we are enabling customers to access Wikipedia without incurring any data charges.”

Sue Gardner, the executive director of the Wikimedia Foundation, said the partnership with Orange will give Wikipedia access to millions who have not had it.

“Wikipedia is an important service, a public good, and so we want people to be able to access it for free, regardless of what device they’re using,” Gardner said.

In November 2010, he left Silicon Valley to launch the online flash-sales shopping club MarkaVIP in Jordan, and in March opened centers in Lebanon, Saudi Arabia and other Gulf countries. Shopping clubs require membership and offer sales at discounted prices for a limited period; flash sales are bargain offers that are available for a very limited time, sometimes only hours. By working with clothing companies that need to get rid of excess inventory, MarkaVIP offers thousands of designer-label fashions at bargain-basement prices.

Read the rest of this post on the original site »

The disruption, which occurred at about 6 am ET, was still affecting users nearly three hours later, with no time given for a resolution.

“We are working to resolve an issue currently impacting some BlackBerry subscribers in Europe, Middle East and Africa,” Research In Motion said in a statement. “We’re investigating, and we apologise to our customers for any inconvenience caused while this is resolved.”

Another tough break for RIM, which endured a service disruption in Canada last month, and at least two fairly major outages in the U.K. and U.S. last year.

With its annual meeting this coming Thursday, you’d think Yahoo CEO Carol Bartz would be taking a rest.

Not so!

She has been a regular Carmen Sandiego, in fact, jetting to Yahoo hotspots around the globe from Dubai to Milan to New York and then back to Yahoo’s Sunnyvale, Calif., HQ.

As do Yahoos, I get most of the Friday emails she sends out, but I usually don’t bother to post them.

That said, I liked the can-do tone of this one, shades of Bartz early in her term, even in the face of a stock price that’s dropped almost eight percent this month to close at $14.69 on Friday.

(To be fair, the shares of Google are down by a little more in the same time, although its CEO Larry Page seems to prefer to remain holed up in his digital cave in Mountain View and lick his stock wounds.)

No matter, as Bartz writes, it’s nothing a little retail therapy can’t fix!

I myself am off on an international biking vacation in Ireland next week, so while I am gone, please enjoy Carol’s letter to Yahoos:

Last week was a crazy one -– Dubai and Milan in five days! You may not know it, but the Middle East and Italy are two of our hottest markets in the EMEA region (and I do mean hot — it was 114 Fahrenheit and very humid in Dubai — I thought I was going to melt!).

First on the itinerary was Dubai, where I met with government officials, advertisers, the media, and our awesome Yahoos there.

I kicked things off Monday with the Deputy Ruler of Dubai, Shaikh Maktoum Bin Mohammed Bin Rashid Al-Maktoum. Turns out he is a BIG Yahoo! fan. He told me that he’s on our sites every day to check the latest news and sports headlines. It makes sense — we’re huge in the Middle East and North Africa. Since we acquired Maktoob a year and a half ago, we’ve grown from 30 million to 53 million users. That’s impressive in a region with more than 70 million people online today.

We’re tops in entertainment with omg! Arabic, and with our women’s lifestyle site, Helwa. And we’re a strong #2 in News, thanks in part to our new Arabic homepage that launched six months ago. Already, it’s our fourth most popular homepage in the world — right behind the U.S., India and Taiwan. Meanwhile, Yahoo! is #1 in the Middle East and North Africa for display advertising with 40% market share.

Then on Wednesday it was off to Milan, where I visited with advertisers and our passionate Yahoos there. (I love that our Italian headquarters also happens to be located in one of the fashion capitals of the world — so convenient! An hour of retail therapy goes a long way).

We are winning it Italy. In a business review, our folks called themselves the Yahoo! “Italian Racing Team,” and I believe it. They’re firing on all cylinders. The country boasts some of the highest engagement numbers for us in the EU. We reach 66% of the online population in Italy. We’re top three in seven content categories, and #1 in four of them: Mail, News, Answers and Flickr. Plus, these #1 sites are growing faster than the market. And on the ad side, May was a record month for our display advertising in Italy — we’re taking share while growing revenue.

Throughout my trip to Italy and the Middle East, one thing came through loud and clear: Our local teams are able to execute and grow user engagement more quickly than ever before. This is thanks, in large part, to the great work of our Products org.

Take, for instance, our new Yahoo! Publishing Platform (aka LEGO). Our editors have put it to good use on our Italian Movies site. We’ve seen a 90% increase in page views, and a 60% increase in users. And that’s just in the first three weeks! This is exactly what we’ve been working so hard on for the past two years. We’ve completely re-architected our infrastructure, and it’s incredibly satisfying to see it pay off in so many parts of the world.

After all that fun, I headed back across the Atlantic and spent two good, solid days covering a lot of business in the Big Apple — press, investors, agencies and Yahoo! Sales leaders. Then it was back here to Sunnyvale for CEO staff meetings and a great “Coffee with Carol” with 30+ Yahoos.

I’m off to have a good weekend, hope you do too — especially you Dads on Father’s Day!

Carol

McAfee Inc., acquired last month by Intel Corp., has provided content-filtering software used by Internet-service providers in Bahrain, Saudi Arabia and Kuwait, according to interviews with buyers and a regional reseller. Blue Coat Systems Inc. of Sunnyvale, Calif., has sold hardware and technology in Bahrain, the United Arab Emirates and Qatar that has been used in conjunction with McAfee’s Web-filtering software and sometimes to block websites on its own, according to interviews with people working at or with ISPs in the region.

A regulator in Bahrain, which uses McAfee’s SmartFilter product, says the government is planning to switch soon to technology from U.S.-based Palo Alto Networks Inc. It promises to give Bahrain more blocking options and make it harder for people to circumvent censoring.

Read the rest of this post on the original site

The new local versions are for Algeria, Egypt, Jordan, Morocco, Saudi Arabia, Tunisia and Yemen. There isn’t one for Libya, where YouTube has been blocked since January.

YouTube already offers an Arabic version and hosts lots of content from users in the Middle East, including news networks Al Arabia and Al Jazeera. And the site is mostly available to Internet users in the region, though it has been blocked by ISPs in Egypt, Tunisia and Libya at the request of local governments both as a domain and as part of general Internet shutoffs over the last few months.

The most important aspects of the local versions of YouTube are dedicated home pages that show the most popular and trending videos in each country. This makes local videos much easier to find, especially because some of the most interesting videos on YouTube come from people who were previously unknown.

Previously, would-be viewers might have had to do extensive searching on YouTube or rely on Facebook, Twitter and news outlets to find important new video posts from these countries.

To whatever extent citizens watch and share local videos, the Middle East pages could mean that YouTube is a bigger touchpoint for on-the-street accounts from protests and other timely content. It should also make it easier for the rest of the world to find such videos.

YouTube seems to be playing down the political implication of the Middle East pages, though it seems obvious given the timing. In an announcement written in Arabic on the Google Arabia Blog (and not yet cross-posted on YouTube’s main blog or its news and politics blog), the company highlighted Jordanian cartoonist DinaKaradsheh, popular Lebanese musician Nancy Ajram and professional news networks–rather than calling out the opportunities to more easily find citizen video.

The post, written by Associate Product Marketing Manager Najeeb Jarrar, ended with a sort of plea to keep the Middle East discourse open:

Of course, the YouTube community reflects the whole world, with its vast differences of ethnicity, religion, nationality, language, politics and more. Not everything on YouTube will please everyone, and we encourage people to actively participate, learn the rules and flag content that might violate them. In the end, YouTube is a place where people go to exchange all kinds of ideas, and we hope you will join the conversation.

Mrs. Clinton made her second major address on the Internet Tuesday and particularly cited the recent leaking of thousands of secret State Department cables by the Web site WikiLeaks as the type of abuses that need to be guarded against. She stressed that nations need to agree on common legal platforms to ensure the Internet isn’t used for theft, espionage and political repression.

But the former first lady hailed the role that social networking sites like Facebook and Twitter have played in organizing a recent wave of political protests that have targeted dictatorial regimes in the Middle East.

“Finding the proper measure for the Internet is critical because the qualities that make the Internet a force for unprecedented progress—its openness, its level effect, its reach and speed—also enable wrongdoing on an unprecedented scale,” Mrs. Clinton told a gathering at George Washington University.

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(Click on the “CC” button in the embedded video to see English subtitles, and if that doesn’t work try going directly to the YouTube page.)

Ghonim, who leads marketing for Google in the Middle East and North Africa, said in a later interview that he was the administrator of the Facebook page “We are all Khaled Said” (named after the young man killed by Egyptian police officers last year) that helped organize Egyptian youth.

Ghonim said he was blindfolded throughout his imprisonment but was not tortured. The Egyptian government did not confirm its role in Ghonim’s disappearance until yesterday.

Ghonim told an interviewer from the Egyptian channel Dream TV, “I tricked my employer so I could attend the protests in Egypt,” according to a translation.

Nearly 300 people have been killed in the protests. Ghonim urged viewers, “Please everybody, this is not a time to settle scores, this is a time to build our country.”

A cellphone recording of the second interview, sans subtitles, is here:

Video streaming by Ustream

Egypt’s government, which took the unprecedented step of shutting off Internet access during the height of the protests, restored service Wednesday, said Hassan Kabbani, chief executive of cellphone service provider MobiNil. Web sites that had been inaccessible for days, including the Central Bank of Egypt’s, were available again at midday.

The army’s call for an end to the protests came after Egyptian President Hosni Mubarak said he will step down after elections this year, bowing after 29 years in power to a popular uprising that has begun to reshape the Middle East.

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Unsurprisingly, Symbian is the leading mobile OS worldwide. It’s dominant in some 100 countries and accounts for more that half of all mobile Web usage in 75 of them. It essentially owns the Mideast and most of the developing world, thanks to those regions’ affinity for Nokia’s cheap mobile phones.

Apple’s iOS is the second most used mobile OS worldwide, with its iPhone and iPod touch claiming the most mobile Web traffic in 30 countries. In 21 of them, those devices accounted for more than half of all mobile Web traffic. IOS appears most popular in Canada, Cuba (!), Switzerland and Australia, where it claims over 70 percent of all mobile Web traffic. Interestingly, it’s quite a bit less popular in the United States, where it garnered a little over 35 percent.

Research in Motion’s BlackBerry OS leads four countries, with one–the Dominican Republic–where OS usage is over 50 percent. Shockingly, in its home country of Canada, it accounts for a paltry 3.6 percent of mobile Web traffic.

And Android?

It leads just one country, South Korea, with a 78.3 percent share of all mobile Web traffic. Presumably, that’s thanks to Samsung, which is based in the country and sells a number of Android phones. So while Android is surging ahead, thanks to Google’s strategy of flooding the market with multiple handsets on multiple carriers at a wide range of price points, there’s still a hell of a lot of market share that it hasn’t even come close to touching.

[Image credit: Chart and data courtesy Royal Pingdom]

It’s familiar territory for her in more than one way, since she once helped Google (GOOG) manage the same geography.

Shields has had a busy couple of years: Two years ago, she arranged the sale Bebo to AOL (AOL) for $850 million. A year after that, she took off, and ended up in a content start-up backed by Elisabeth Murdoch’s Shine Group.

It’s unclear what happened to that now less-than-shiny project.

Blake Chandlee, who had been running the EMEA group at Facebook, is getting moved out of that job and will now run sales in emerging markets: Eastern Europe, Asia Pacific and Latin America.

This is the second high-profile hire–and of a former Googler–by the social networking site recently. Last week, Facebook hired top-ranking Google ad exec David Fischer as VP of Advertising and Global Operations.

With Fischer and former Googler COO Sheryl Sandberg, who has been eyeing Shields as a possible Facebook recruit since she left AOL, it seems an Ex-Googleplex is forming at Facebook’s new HQ in Palo Alto, Calif.

Some of the many former Googlers include Elliot Schrage, VP of Global Communications, Marketing and Public Policy; Grady Burnett, head of online and inside sales; Don Faul, director of global online operations; and Ethan Beard, director of the Facebook Developer Network.

News was actually committed during Yahoo’s fourth-quarter earnings conference call today when CEO Carol Bartz noted that the company would disable its irksome “hover interaction” on the homepage and that the Internet giant has restructured its international business.

Yahoo (YHOO) reported results earlier today that slightly exceeded expectations in the fourth quarter, but it was no blowout.

Said a Yahoo spokeswoman in an email to BoomTown about dumping the hover:

“We are in the process of making a change to the hover interaction and it should be live in all markets that have the new homepage by late tonight. To give people more control over their experience, we are adding the ability to select from either a ‘hover’ or ‘click’ interaction for activating previews of apps in the My Favorites section. The default setting will be a click interaction, but people can also use a hover interaction by selecting that option as their default preference. You should see this change on your own homepage very soon.”

The hover feature, while initially touted as giving users easy access to widgets on the homepage, has been widely decried by advertisers because it essentially covers other ads at the top of the page, which are Yahoo’s most lucrative inventory.

Also, simply put, the hover is super-annoying.

Back in July when Yahoo rolled out the new homepage design, though, the company was high on the hover. (You can see it in action below; click on the image to make it larger.)

This was the most striking change in the homepage overhaul, in fact, featuring a prominent My Favorites area on the left side with dozens of specially designed applications–email, stocks and third-party sites like Facebook, among others–that users could customize and view through quick hovering glimpses.

Advertising popped up when hovering over the apps, which was Yahoo’s solution to the alternative of sending users away from the site when they clicked the apps.

In addition, Bartz said in the call that Yahoo’s international operations would be rejiggered, after an ultimately fruitless search for a new head of the unit. Bartz said she had not been able to find a qualified exec to run international, so she decided to change the set-up.

International ops will be reduced from four regions to three–Americas; Europe, Middle East, Africa; and Asia Pacific–with Emerging Markets tucked into them.

They will report to Bartz directly–with current Emerging Markets head Keith Nilsson taking the job of Global Initiatives SVP, also reporting to her.

Wrote another Yahoo spokeswoman:

“Yahoo! has reorganized our regions to strengthen focus on emerging countries, and to align company-wide resources and expertise against the company’s vision to be the center of people’s online lives. Effective April 1, the structure will be made up of three regions: The Americas, EMEA and APAC. Our Emerging Markets region, formerly separate, will be absorbed into these new regions to better support our work in countries with large and growing Internet populations. Yahoo! is making a further commitment to its global customers with the creation of a Global Initiatives SVP, reporting directly to Carol Bartz, CEO, focused on supporting global relationships and alliances.”

Rose Tsou heads up APAC, Rich Riley runs EMEA and Hilary Schneider helms the Americas.

Yahoo bested Wall Street expectations today, announcing stronger net income for its third quarter, despite an also expected decline in revenue.

The Sunnyvale, Calif.-based Yahoo reported net income of 13 cents a share, or $186.1 million, on revenues of $1.13 billion for the quarter ended Sept. 30, 2009, which was a decline from $1.33 billion the same period a year ago.

Wall Street estimated that Yahoo (YHOO) would earn just under seven cents a share on revenues of $1.12 billion.

The improvement includes a $98 million gain on a sale of the company’s stake in Alibaba.com in China, which is nonrecurring, as well as other cost-cutting by CEO Carol Bartz.

In addition, Yahoo’s expectations for the fourth quarter are more positive than those of investors.

Also in the earnings numbers: Yahoo had $4.5 billion in cash and marketable securities, as well as 13,200 employees.

But there was something to worry about: Search advertising revenue was off 19 percent and display was off eight percent at “Owned and Operated” sites on Yahoo.

Google (GOOG), in contrast, reported a seven percent rise in its recent third-quarter results last week, and its execs projected a mood of smooth sailing ahead and no more econalypse.

Nonetheless, overall, it was a solid performance from the Silicon Valley icon, especially compared to some of its recent and decidedly rockier earnings reports.

But, while investors can now breathe a little sigh of relief that the bleeding seems to have stopped, they will now likely focus on how much growth the Yahoo can have in the future.

That’s the next story for certain, starting with Yahoo’s analyst meeting next Wednesday, although today’s Yahoo management buzzword was “stablized.”

“With revenue coming in above our guidance and flat sequentially, we had a solid third quarter that signals our major businesses have stabilized,” said Bartz in a press release. “With new products like Yahoo! homepage, our brand revitalization campaign and expansion in the Middle East through Maktoob.com, our execution is improving and we’re focused on what we do best–being the center of people’s online lives.”

Added CFO Tim Morse: “In the third quarter we saw strength in key areas of our business. Our efforts to reposition Yahoo! are still in the early stages, but we’re confident that our investments in the business will enable us to capitalize on growth opportunities as the economy recovers.”

You can read all about it in Yahoo’s press release here, which includes performance tables of third-quarter results, or below without tables.

More to come at the conference call at 2 pm, which BoomTown will blog live!

Here is the Yahoo press release on the quarter:

YAHOO! REPORTS THIRD QUARTER 2009 RESULTS

Company Exceeds Revenue Outlook Maintains Strong Balance Sheet with over $4.5 Billion in Cash and Marketable Debt Securities

SUNNYVALE, Calif., October 20, 2009–Yahoo! Inc. (NASDAQ: YHOO) today reported revenues of $1,575 million for the quarter ended September 30, 2009, a decrease of 12 percent from the third quarter of 2008 and slightly above the second quarter of 2009. Excluding the impact of currency rate fluctuations and divested business lines, revenues for the third quarter of 2009 would have declined 7 percent compared to the third quarter of 2008.

Net income per diluted share for the third quarter of 2009 was $0.13, compared to $0.04 for the third quarter of 2008. Non-GAAP net income per diluted share for the third quarter of 2009 and 2008 was $0.15.

“With revenue coming in above our guidance and flat sequentially, we had a solid third quarter that signals our major businesses have stabilized,” said Yahoo! chief executive officer Carol Bartz. “With new products like Yahoo! homepage, our brand revitalization campaign and expansion in the Middle East through Maktoob.com, our execution is improving and we’re focused on what we do best–being the center of people’s online lives.”

:In the third quarter we saw strength in key areas of our business,” said Yahoo! chief financial officer Tim Morse. “Our efforts to reposition Yahoo! are still in the early stages, but we’re confident that our investments in the business will enable us to capitalize on growth opportunities as the economy recovers.

Revenues

* Marketing services revenues declined 12 percent and fees revenues declined 11 percent, compared to the third quarter of 2008.

* Marketing services revenues were flat and fees revenues increased 2 percent, compared to the second quarter of 2009.

* Marketing services revenues from Owned and Operated sites were $851 million for the third quarter of 2009, a 15 percent decrease compared to $1,002 million for the same period of 2008. The decrease was primarily driven by a 19 percent decline in search advertising revenue and an 8 percent decline in display advertising revenue.

* Marketing services revenues from Affiliate sites were $526 million for the third quarter of 2009, a 6 percent decrease compared to $561 million for the same period of 2008.

Cash Flow and Cash Balance

* Cash flow from operating activities for the third quarter of 2009 was $355 million, a 2 percent increase compared to $347 million for the same period of 2008.

* Free cash flow for the third quarter of 2009 was $258 million, a 20 percent increase compared to $215 million for the same period of 2008.

* Cash, cash equivalents, and investments in marketable debt securities were $4,503 million at September 30, 2009 compared to $3,522 million at December 31, 2008, an increase of $981 million.

Business Outlook

GAAP revenue for the fourth quarter of 2009 is expected to be in the range of $1,600 million to $1,700 million. Non-GAAP operating income before depreciation, amortization, and stock-based compensation expense for the fourth quarter of 2009 is expected to be in the range of $400 million to $450 million. Income from operations for the fourth quarter of 2009 is expected to be in the range of $135 million to $155 million.