AT&T said it would turn over the airwaves, or spectrum, along with $3 billion in cash to T-Mobile parent Deutsche Telekom AG after pulling out of the deal as opposition mounted from the FCC, Justice Department, state attorneys general and rival carriers.

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Shares in the company rose some 5 percent Thursday on market chatter that it’s looking for buyers. The latest story making the rounds: RIM has hired Goldman Sachs to explore strategic options.

Is there any more truth to this rumor than the ones that preceded it? It’s certainly possible, though, as we’ve said before, RIM’s not a takeover target if no one wants it.

“There are several roadblocks that make an acquisition of RIM unlikely,” Morningstar analyst Michael Holt recently wrote. “We believe RIM should entertain all options at this point, given the serious challenges facing the firm, but there is little evidence to suggest RIM’s board is open to offers at this point in time.”

(Image courtesy of The Joy of Tech)

I really can’t say if I like this video or I am completely freaked out by it.

T-Mobile, which didn’t get sold to AT&T, hired Hollywood director Alfonso Gomez-Rejon and “surprised” shoppers at the Chicago area’s Woodfield Mall with a flash-mob performance of “(There’s No Place Like) Home For The Holidays.”

It’s like the gals from television’s “Glee” cloned themselves and went wild, while stealing a 1980s look from the classic teen movie “Pretty in Pink.”

Except even stranger and up to more than four million views on YouTube.

Now, who knows what the mobile carrier will do next with all those billions from the scotched takeover deal? An unholy combo of HBO’s “Boardwalk Empire” with the even more grating kid’s film I barely endured, “Alvin and the Chipmunks: Chipwrecked”?

Until we find out, enjoy, and then please get back to work tomorrow, everyone:

Though last week’s reports were overblown and premature, it certainly might come to that at some point if past is prologue — Alibaba CEO Jack Ma has declared his interest publicly a number of times and has certainly been busy lining up his financial and strategic partners to do so.

This is one very sharp sword of Damocles hovering over Yahoo that could drop at any time and very quickly. It has impact, too, because every day there are unsettling Wall Street whispers that the bid is coming — I got three today, in fact, that it would happen Monday.

Actually, the day it is most likely to happen is the moment after Yahoo once again turns down the pair’s latest offer to buy back their shares in a complex tax-free transaction.

This has been a multi-year effort on the part of the trio, one littered mostly with recrimination and tears. Lots and lots of tears.

But this time, it’s critical to the Asian partners to strike the deal with Yahoo — and before its current board does another deal with current private equity bidders it is now contemplating.

Because once new leadership is in power, Ma’s leverage goes buh-bye. Now, it is a quantum level higher with the old Yahoos than with the next ones, who will have much more control and power over the company.

Thus, the threat of a possible whole company bid at a higher prices — a tasty treat to disgruntled shareholders — keeps the pressure on Yahoo’s current directors not to make a partial deal that is considered wanting.

This bird in the hand is seen as critical to Alibaba and SoftBank, who want only to get back their stakes and not to engage in what would turn into an ugly and hostile battle for control of all of Yahoo.

As one source told me last week: “The threat of a takeover is more useful than the damage an actual takeover would cause for everyone. No one wants this to be unfriendly.”

Perish the thought!

Yahoo board member Brad Smith — who is Intuit’s CEO and president in his spare time — has become the key man in this whole complex sales process and has also taken up the central role in dealing with the Asian proposal, along with Yahoo’s interim CEO, Tim Morse, and its legal head, Mike Callaghan.

They have to wrangle what to do with Yahoo’s 40 percent stake in Alibaba and a 35 percent holding in Yahoo Japan, which makes up a great deal of the company’s value and has become its most vexing Gordian knot.

Still, after a number of previous efforts failed miserably, Alibaba and Softbank brought yet another proposal to Yahoo in early October that would spin off the stakes to them and also avoid a big tax bill.

The sides have been talking on and off amid the other noise at Yahoo of late, which this week centered on low-priced bids for a partial investment in Yahoo from two separate PE firms, Silver Lake and TPG Capital.

Now what Yahoo does with its Asian assets matters to them, too, as both have their own plans for the dispensation of those stakes as key elements of their deals.

So it is not clear what would happen if the Alibaba and SoftBank shares were sold before either deal was done.

But it is unlikely to be a positive thing.

“The Asian assets are downside protection if the core Yahoo business is melting faster than anyone thinks,” said one person. “Without it there, Yahoo might be a lot more risky to buy into.”

Like, you might say, trying to catch a falling knife.

What an amazing coincidence.

On the very day Yahoo’s board is considering actual bids from two private equity firms interested in deals to buy close to 20 percent of the company for between $16.50 and $17.50 a share, comes a spate of eerily similar breathless media postings that there’s another bid in the making for $20!

That’s totes better, right? I mean, how can Yahoo’s directors accept a real live lesser-priced bid now when there’s a prettier one in the fog just ahead?

No, really, it’s there — if you squint really, really hard.

Except it’s not even close, when you actually check with two of the key members of the group of alleged buyers, which would apparently be Blackstone, Bain Capital and Yahoo’s Asian partners, Alibaba Group and SoftBank.

Sources close to Blackstone and Alibaba said while there have been talks, which have been previously reported weeks ago here and elsewhere, there is no bid in the offing that is close to fruition and at that price.

In an unusual public statement, in fact, Alibaba’s John Spelich said flatly: “Alibaba Group has not made a decision to be part of a whole-company bid for Yahoo.”

This from a company whose voluble CEO Jack Ma is prone to making giant and noisy speeches to signal his interest in finding a way — any way — to get back shares of the Chinese Internet giant from Yahoo.

Not this time, and several sources close to Alibaba reiterated that it was nowhere near close to any bid as yet and that a price is still up in the air. In addition, sources added, Alibaba might decide to work with another PE group, such as Providence Equity.

In addition, sources noted that if Alibaba could strike an adequate deal with private equity bidders to get a large chunk of the stake back, it would be highly preferable to a hostile takeover of Yahoo that could end in tears and little else.

“The threat of a takeover is more useful than the damage an actual takeover would cause for everyone,” said one person close to the situation. “No one wants this to be unfriendly.”

So why the rumors — doubtlessly being spread around by hopelessly cynical Wall Street types interested only in stock manipulation — surfacing today?

Simple: To get some easy-to-play media outlet to bite, report it as speculative fact and cause the stock of Yahoo to take flight tomorrow.

Hey, it could happen!

Sadly, this junior-league trick has already worked — Yahoo shares were up a dollar to $16.72 in after-hours trading tonight.

It is likely to go even higher tomorrow, which could cause the board of Yahoo to delay accepting either of the partial bids from Silver Lake or TPG Capital, even if they were the best thing for the company and its employees.

Except that the job of the Yahoo board is to evaluate what’s before them and not what is perhaps, someday, soon, wait-by-the-phone, really soon, I promise is going to be delivered.

In fact, several sources noted that it’s not clear if the Yahoo board has even asked for parties to submit whole-company bids yet.

When and if Yahoo’s board does that and if something better actually does come down the pike, with a much fatter price tag of $20 or more, then the directors can mull that over.

That would be the prudent thing to do for the company, its employees and its shareholders, even if Yahoo’s stock gets a temporary lift now.

Maybe I am just a hopeless Silicon Valley romantic and not a hardened Wall Street M&A type, but the survival of Yahoo is the real point here, rather than the lining of bankers’ already fee-stuffed pockets.

And anything other than that is just fog.

In a statement Friday, AT&T said commissioners won’t be able to vote a proposal announced Tuesday from FCC Chairman Julius Genachowski that the $39 billion merger be sent before an administrative law judge. The carrier announced it had withdrawn its FCC application in the early hours of the Thanksgiving holiday in the U.S.

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One of Yahoo’s biggest problems — brain drain — has turned out to be an asset for private equity firms and other players interested in figuring out their best moves related to the Silicon Valley Internet giant.

A plethora of ex-Yahoos, including many former top execs, are getting buttonholed by those who want to know more about the inner workings of the company that might not be obvious from its copious financial data available publicly.

That includes former Americas head Hilary Schneider, who has a longer-term consulting gig with TPG Capital, one of the several PE firms that has recently signed a non-disclosure agreement with Yahoo; former COO and President Sue Decker, who has had a longtime informal relationship with Blackstone, which has not signed the NDA and has been in talks with Yahoo’s Asian partners, China’s Alibaba Group and Japan’s SoftBank; and even former CEO Carol Bartz, who sources say has also been contacted to get her insights.

She is one of many in that regard, in a large pool of former Yahoos, such as: LinkedIn CEO Jeff Weiner, who had run Yahoo’s media efforts; Chegg CEO Dan Rosensweig, former Yahoo COO; SurveyMonkey CEO Dave Goldberg, who ran swathes of Yahoo’s entertainment properties; Criteo CEO Greg Coleman, former Yahoo sales head; former CEO Terry Semel, who is now an investor; former communications exec Brad Garlinghouse, who is now at AOL; and Demand Media Chief Revenue Officer Joanne Bradford, who also was a top Yahoo advertising exec.

Not all are cooperating with the requests for a chitchat about Yahoo, but there is much incoming interest in ex-Yahoos and what they might know.

There’s lots more where that came from, from all parts and all levels of Yahoo, given the breadth of the exes now doing very well — thank you very much — throughout the tech and media industries.

Thus, calls from PE firms, from Silver Lake to Bain Capital to Providence Equity Partners, as well as interest from major and majorly irritated shareholders, such as activist hedge fund investor Dan Loeb.

It’s a smart idea to tap this rich vein of information, as all contemplate possible multi-billion-dollar investments.

While some of these execs have not worked at Yahoo in many years, all have significant knowledge about the challenges and also the culture that cannot be gleaned from spreadsheets.

They also know a lot about the internal politics and personalities of the existing inside players, too. More importantly, several were involved in similar previous major business decisions at Yahoo.

Decker, for example, was a key exec in the Yahoo takeover attempt by Microsoft several years ago; Schneider and Bartz were deeply involved in striking the advertising and search partnership with Microsoft.

“Between everyone, it’s a good way to figure out where all the bodies are buried,” said one person close to the situation. “And there are a lot of bodies.”

AT&T said in a regulatory filing it expects to close the $39 billion takeover of T-Mobile, a unit of Deutsche Telekom AG, by the end of next year’s first half. It had originally expected the deal to close by the end of March. The carrier said its purchase of Qualcomm’s spectrum should be closed by the end of next year’s first quarter, a change from its prior expectation for year-end.

A range of major players interested in acquiring all or a large piece of Yahoo have been prepping possible bids and have been in touch with the Internet giant’s board over the last several days.

While Yahoo has publicly said it was not for sale, according to numerous sources both inside and outside the company, it has been receptive to the interest and its Chairman Roy Bostock and Co-founder Jerry Yang have spoken to several.

Among the possible players: Silicon Valley venture firm Andreessen Horowitz, which is working with private equity firm Silver Lake, in a deal that also might include Russia’s DST Global and Yahoo’s Japanese partner Masa Son; former News Corp. exec Peter Chernin, who is partnered with Providence Equity Partners; and the possibility that Yahoo’s Chinese partner, Alibaba Group, might consider entering the fray in what could be a reverse merger of sorts.

Also being rung up by some of the parties: Microsoft — Yahoo’s advertising and search partner — which is being seen as a possibly moneybags in any deal.

The movement among these investors is against a backdrop of increasing pressure for Yahoo’s board, after it fired CEO Carol Bartz last week. In the wake of the dramatic move, shareholders have upped criticism of Bostock and the board and have been looking hard for alternatives.

Today, that included hedge fund investor Daniel Loeb of Third Point, which has a 5.1 percent stake in Yahoo. In a filing this morning, he said he might increase that amount, and described a testy hour-long phone call he had earlier this week with Bostock that ended abruptly with a hang-up from Yahoo.

Sources said Loeb called Bostock a “fool,” among other not-so-nice names, on the call and asked for Yang’s help in dumping him.

This comes as exactly no surprise, given his previously strong letter in which Loeb called for Bostock’s ouster.

Loeb has been calling out Bostock — who is also on the boards of Morgan Stanley and Delta Airlines — for a series of gaffes at Yahoo since he became chairman in 2008 (he’s been on the board since 2003).

Those have included: Yahoo’s bungled effort to stave off a takeover by Microsoft several years ago; the too-long enthusiasm for Bartz, who was hired in early 2009 and fired last week; sitting unusually still as competitors such as Facebook, Google and more have out-innovated and outgrown Yahoo; and, of course, the falling knife of a stock, which has dropped precipitously since Bostock has been in charge of the board.

As Loeb wrote in a letter he sent to the company last week:

“It is time that certain members of this Board were held accountable for its past failures and their individual roles. Accordingly, we insist that Mr. Bostock, who championed Ms. Bartz’s hiring and led the charge against the Microsoft deal, promptly resign from the Board.”

Loeb is likely to add to that later today at a high-profile investor conference in New York, where the colorful but tough-talking investor is sure to add more logs to the fire.

But it not only him. Other major shareholders of Yahoo are also in touch with possible outside buyers, seeking a change at the long-troubled company, after its shares have remained in the doldrums, its attrition rate of employees has spiked and its product pipeline has slowed to drip.

This has all been taking place — of course — during one of tech biggest and most innovative booms, in which Yahoo competitors have grown strongly.

Enter Marc Andreessen, the well-known entrepreneur who has transformed himself into one of Silicon Valley’s most powerful venture capitalists.

He and his partner Ben Horowitz recently pulled off another similar deal — with Silver Lake — to take control of a then-troubled Skype. They later flipped it to Microsoft for a large return.

Sources familiar with the situation said the pair have become increasingly intrigued by the situation at Yahoo and believe that its assets and brand are still strong, despite its management turmoil in recent years.

One problem is the huge cost of almost any kind of takeover and also the complexity, given much of Yahoo’s $18.5 billion valuation is due to its Asian assets.

The sale of those shares, as well as the selling off of some of Yahoo’s less core properties, makes for a very complicated situation for anyone.

Said one person looking at the company: “It is one of the more massive hairballs around.”

That is a common sentiment among many of those looking at Yahoo, which has hired Allen & Co. to manage the process.

Also of worry is a bid that would include too many players. Yahoo has long been plagued by indecisiveness on the part of its execs and, mostly, its board.

But one thing all the possible buyers of Yahoo, as well as an increasing number of its shareholders, agree on: The Yahoo board needs a major shake-up.

As Loeb wrote last week, which many I interviewed also echoed:

“This letter details our principled demands for sweeping changes in both the Board of Directors (the “Board”) and Company leadership, and outlines the hidden value of Yahoo, which has been severely damaged — but not irreparably — by poor management and governance.”

The Yahoo board will be meeting in Silicon Valley tomorrow to discuss a wide range of worrisome issues facing the troubled Internet giant.

Meanwhile, several sources said, even more private equity investors are weighing making major investments in the company, all pretty much aimed at ousting said directors.

So far, that has only been Third Point’s Daniel Loeb, whose massive hedge fund now owns 5.1 percent of Yahoo.

Loeb appears tomorrow at the high-profile Delivering Alpha investor conference in New York at 2 pm PT, where he is expected to take another swing at Yahoo’s board.

His next moves, sources said, could include buying up more shares to put the pressure on and also presenting his own alternate slate of directors, much as activist investor Carl Icahn did several years ago at Yahoo.

Translation: Forget AOL’s CrunchGate — this is big-boy corporate battling!

Add that to the pile on Yahoo’s board meeting agenda, along with some other critical issues that include: Outlining the criteria for any CEO candidate and a discussion of headhunting firms to hire; a review of strategic alternatives, including a presentation by its investment advisors, Allen & Co.; and how to stabilize the company and reassure its dusting-off-their-resumes employees.

Finding answers to these questions is going to be difficult enough, but the ever increasing pressure from outside investors is going to make it even harder.

Some definite tire-kickers reportedly looking at a bid include Providence Equity Partners, Silver Lake, Blackstone, Texas Pacific Group and even KKR.

While KKR has reportedly close ties with Yahoo Chairman Roy Bostock, he is now the main target for pretty much everyone else.

That includes Loeb, as well as other major Yahoo shareholders.

That’s no surprise: Bostock, who is also on the boards of Morgan Stanley and Delta Airlines, has presided over a series of gaffes at Yahoo since he became chairman in 2008 (he’s been on the board since 2003).

Those have included: Yahoo’s bungled effort to stave off a takeover by Microsoft several years ago; the too-long enthusiasm for CEO Carol Bartz, who was hired in early 2009 and fired last week; sitting unusually still as competitors such as Facebook, Google and more have out-innovated and outgrown Yahoo; and, of course, the falling knife of a stock, which has dropped precipitously since Bostock has been in charge of the board.

As Loeb wrote in a letter he sent to the company:

“It is time that certain members of this Board were held accountable for its past failures and their individual roles. Accordingly, we insist that Mr. Bostock, who championed Ms. Bartz’s hiring and led the charge against the Microsoft deal, promptly resign from the Board.”

Said another source with knowledge of the situation: “Under Roy’s leadership, this weak and bumbling board took too long to fire a clearly failing CEO and now has no plan, except throwing up their hands and hoping someone comes along.”

Here is one certainty: Someone is going to come along and it is not going to be pretty.

T-Mobile — that company we want to buy for $39 billion — is doing just awful.

We understand the argument tactically. AT&T also has said it wants to buy T-Mobile for its wireless spectrum, and not so much for its operational prowess. But AT&T’s soft diss of its merger partner does have a strange ring.

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You see, the takeover or breakup of Yahoo has been an endless string of failed efforts, pitches, rumors and stupid ideas. For more on this, we turn to the moment of Original Sin: Microsoft’s February 2008 unsolicited offer to buy Yahoo for $45 billion, or about $31 a share.

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The firing of Yahoo CEO Carol Bartz leaves open one of the bigger and more difficult jobs in tech — one that has taken its toll on many.

Nonetheless, rapper Snoop Dogg stepped right up to the Twitter plate yesterday, as soon as news broke of the ouster.

Tweeted Snoop Dogg:

“Im takn over as tha CEO of Yahoo. Need sum of tha Snoop Dogg content ya digg. Nuff Said.”

Not nearly nuff!

Thus, while the Yahoo board has yet to begin a search, I have already been hard at work on selecting the next CEO.

(Last time, the company took none of my suggestions, but after the most recent result, the directors might want to pay mind!)

Sources said Yahoo is looking for an experienced Internet type, either from inside or outside the company.

“Yahoo has put its flag in the ground as a digital media company with a technology base,” said one source. “The job requires big buckets of expertise and needs someone who will grow the company.”

Here I go with the outsiders:

Peter Chernin: The former News Corp. exec has been eyeing Yahoo for a possible takeover with other investors. Both Yahoo and I had picked him when co-founder Jerry Yang stepped down as CEO almost three years ago, and he had declined the offer. This time, perhaps a big chunk of the company and total autonomy would work, even if making a hit like “Rise of the Planet of the Apes” is more fun.

Sheryl Sandberg: The COO of Facebook is sort of the anti-Bartz, with a smooth and efficient persona, and she is an experienced tech exec. But the former Google exec is at a place of growth at the social networking site, and is unlikely to want to leave the big show, especially since a blockbuster IPO is looming.

Jason Kilar: The Hulu CEO is in the midst of the process of selling the premium video service, with Yahoo as a bidder. While he has some tense relations with the studios, Kilar is top notch in his dedication to consumer products, and has a lot of experience from his stint at Amazon, too.

Dan Rosensweig: Currently CEO of IPO-headed Chegg textbook rental service, the former Yahoo exec never got a chance to run the company as its top leader. Well-connected and still well-liked by the troops at Yahoo, it still would be pretty hard for him to go home again.

Dave Goldberg: Sure, he’s married to Sandberg (see above), but the savvy CEO of polling phenom SurveyMonkey is one of the sharpest thinkers in Silicon Valley. He sold his music company to Yahoo many years ago and has a strong background in consumer online services.

Jon Miller: The chief digital exec at News Corp. almost got the CEO spot years ago when Carl Icahn was agitating for change at Yahoo, before Time Warner blocked him via a noncompete. With the mishegas at the media giant, and dwindling digital businesses there, it might be a good escape hatch for Miller.

Susan Wojcicki: The accomplished Google exec, who runs all its ad products, has the kind of calm, cool, collected persona that Yahoo could use right about now. The search giant was founded in her garage, and she has been a key part of its success since then. Wojcicki is also an understated class act in hey-look-at-me Silicon Valley.

Todd Bradley: The Hewlett-Packard exec just got blindsided when the company kicked webOS to the curb. While he is in line to run a possible spinoff of the device business, Bradley might also want to jump out of the frying pan into the fire.

Mike McCue: The CEO of Flipboard would certainly energize Yahoo with his intense focus on quality and consumer delight. The news app start-up could be a good addition to Yahoo, and McCue, the former Netscape and Microsoft exec who is well-liked in the Internet scene, would be, too.

Joanne Bradford: The former Yahoo advertising head bolted Bartz’s regime early on to run revenue for Demand Media. Well-liked in the ad business, she also knows where all the bodies are buried at Yahoo. Since ads and media are key at the company, she’d make an interesting choice.

Yusuf Mehdi: The Microsoft online exec would also be a left-field candidate to run Yahoo, given his even-keeled personality and longtime experience in the sector. And, though pricey, Mehdi’s impact on Bing search has been important. But he’s also been involved in the software giant’s lackluster ad and search partnership and still has not turned around the situation at MSN.

Kevin Johnson: The former Microsoft exec and current CEO of Juniper was once slated to be the CEO of Yahoo, had Microsoft managed to win the company in its hostile takeover attempt. In fact, Johnson was the architect of the idea of Yahoo running the media and Microsoft running the tech.

Tim Armstrong: Well, he might have been a good candidate before the downward slide of AOL and a recent series of questionable judgments. If Armstrong can’t keep a loud tech blogger in line, it’s not clear he can wrangle the Yahoo beast.

And here’s the insider scoop:

Ross Levinsohn: The former News Corp. exec is running the Americas for Yahoo, which puts him in charge of the company’s key businesses. But he’s still struggling to turn the ad business around, and how well he does that could be a major determinant of his success. But fantastic hair!

Blake Irving: The former Microsoft exec has an amiable nature and is well-liked at Yahoo, but he still needs to show that the company can ship some innovative products, and quickly. Like Livestand, the news reader, which is muchly late.

David Kenny: The Yahoo board member is now president of Akamai, which might preclude him from the job. But the well-regarded exec — he’s a snazzy dresser, too — ran one of the Internet’s top digital ad agencies and now has tech chops from the content delivery network.

Memo to Yahoo board: I have a million more ideas, from former Viacom exec Tom Freston to former Yahoo board member Eric Hippeau. Or why not bring back a passel of former Yahoos to advise, such as former CEO Terry Semel or former president Sue Decker?

Or Oprah! I hear Winfrey will be in Silicon Valley later this week, and she has a lot more free time now.

Like Snoop Dogg, she would fo shizzle be the bomb to cover.

Related posts

• As Yahoo Continues to Wobble, Investors (And Board) Eye Options
• Exclusive: Carol Bartz Out at Yahoo; CFO Tim Morse Named Interim CEO
• Carol Bartz’s Last F%*& You — Now Aimed at Yahoo Board
• Yahoo’s Statement on Bartz Ouster
• Wall Street Likes Bartz’s Firing — Yahoo Stock Spikes on News
• My Picks for Yahoo’s Next CEO — Maybe Snoop Dogg, Ya Digg?

In the last month, the stock of AOL has declined just over 50 percent.

But that drop is not just due to the turbulent markets of late. AOL stock had a 50 percent drop over the last six months, a 57 percent decline since the beginning of the year, and a 56 percent plunge since it went public in late 2009.

Which is why some in the industry — at private equity firms and bigger companies — have noted to me that the price of AOL might have gotten low enough for a very cheap takeover.

“You have to look, even with all the problems they have been struggling to fix,” said one person, who also underscored the advertising and other challenges that AOL faces. “But it is so inexpensive, it’s also an interesting idea.”

Said another large investor: “It’s almost free, given its cash on hand.”

Indeed, since in its recent second-quarter earnings report, AOL said that, as of June 30, it has $458.7 million in cash.

That matters, since at $10.22 a share — a far cry from its $28.45 high of all time in late April of 2010 — the market valuation of the New York-based Internet giant is only $1.09 billion.

You do the math.

To give that number perspective, AOL paid out $315 million in cash to buy the Huffington Post in the beginning of this year. And, let us not forget, under different management, AOL forked over $850 million in cash to buy the Bebo social network in 2008, and sold it for a song last year.

Even AOL thinks the price is low, announcing a $250 million stock buyback program this morning, just as shares hit their lowest point ever yesterday.

The stock is up today, though still in the basement.

To be fair, comparable companies’ valuations have also taken a hit recently. Yahoo shares are down 29 percent since the beginning of the year, giving it an affordable $15.3 billion valuation; and Demand Media’s stock has dropped 63 percent in that period, making its current price tag only $703 million.

Calling all shoppers?

You would think the settlement of a major dispute would goose the stock of a company, but Yahoo’s deal with its Chinese partner Alibaba Group on Friday did exactly the opposite.

Despite the clearing of an obvious overhang to its shares, the stock of the Silicon Valley Internet giant dropped almost three percent Friday to close at $13.10. While the ongoing federal budget wrangling was partly to blame, it was only a very small part with an overall market decline of under one percent.

A tepid reaction to the deal — in which Yahoo, Alibaba and Japan’s SoftBank came to terms over the spinoff of Alibaba’s Alipay payments unit after much wrangling over the move — came quickly from Wall Street analysts.

A report titled “Yahoo Inc: Alipay Agreement: Better than Nothing, But Not That Great,” by J.P. Morgan’s Doug Anmuth, was typical. Pointing to no clarity on an IPO of the Chinese assets of Alibaba and that “prior to the divestiture, Alibaba Group owned 100% of Alipay and all of its income, which is now reduced to 37.5% ownership of Alipay and 49.9% share of the pre-tax income,” he noted that Wall Street “has recently assigned no value to Yahoo!’s share of the asset.”

Well, less than zero, if the stock decline is taken into account, which means Yahoo’s market cap is now just over $17 billion.

According to sources close to the situation, especially since Yahoo’s Asian assets make up more than $9 billion of that valuation, private equity investors and others are pulling out their spreadsheets once again about a possible takeover or privatizing of Yahoo.

Several months ago, for example, former News Corp. exec Peter Chernin had been contemplating a friendly bid with partners such as Providence Equity Partners and others. While there have been rumors recently that he has reengaged in that effort, that is unclear.

Sources also note that Yahoo’s top execs, especially CEO Carol Bartz, and also members of its board, are perplexed that the settlement in China — a positive development — had the opposite effect on the stock.

It’s part of a continuing decline. Yahoo shares are down almost 26 percent in the past three months. Most Web stocks — such as Google, Amazon and Microsoft — are strongly up in that period. The only other obvious laggard is AOL, which is down almost 16 percent in the past three months.

Yahoo — which turned in yet another disappointing second quarter on Tuesday, but with all new excuses for the continuing decline in revenue — is now getting toasted by Wall Street.

That would be the marshmallow — and not the champagne — kind.

The stock of the Internet giant dropped below $14 a share, to close at $13.48 yesterday, after the company said its display advertising business in the U.S. was hard hit.

Today, it’s already down even further.

That’s close to an eight percent haircut for the past two days and a decline of 20 percent for the past three months.

In that same three months, Google is up over 13 percent, Microsoft is up over five percent, Amazon is up over 17 percent and Apple is up 13 percent.

You get the general idea here.

The decline means Yahoo’s market value is now only $17.5 billion, and more than two-thirds of that value is accounted for by its Asian assets (more than $9 billion) and cash ($3.3 billion).

That means its other properties are worth just above $5 billion now.

And while CEO Carol Bartz tried again — in a conference call with analysts after the earnings were released — to portray the situation as another part of her never-ending turnaround of the company, the issues at Yahoo are not new.

They range from display weakness to search declines to a talent drain to ineffective marketing to the lack of a consistent and fast-developing pipeline of innovative products to its flaccid board.

The earnings mess — no surprise, given estimates going forward were also missed — was seized on by investors and the press. (See, it’s not only me!)

In a column earlier this week in Forbes, titled “Carol Bartz’s 8 Blind Spots That Sunk Yahoo,” longtime and noisy Yahoo critic Eric Jackson noted:

“[T]he Bartz hiring is a cautionary tale to all boards and investors: An over-confident ex-CEO with no industry experience can make a bad company worse before things get better.”

But perhaps more damaging was a post today in The Wall Street Journal’s Heard It on the Street column by Martin Peers, titled: “Yahoo’s Unsurprising Surprise.”

It began with the cutting line: “Talk about having a credibility gap on display.”

Then it got worse:

“Admittedly, it may be that Yahoo has dropped off the radar screens of so many investors that this latest episode can’t do further damage. Certainly, aside from cutting costs, Ms. Bartz’s turnaround plan for Yahoo remains stillborn.”

That might be too kind if the stock continues to decline, a development that — in turn — might once again begin the speculation of Yahoo as a takeover target.

Which, if that could manage to get Yahoo shares back up, might be a reason to break out the bubbly.

A Yahoo spokeswoman declined to comment, which — given stock prices are what they are — is probably a good idea.

Thing is, implicit in the phrase “takeover target” is the idea that someone actually desires the target in question. And in RIM’s case, I’m not quite sure that’s true.

Could anyone buy RIM? Sure. Microsoft and Dell have both been rumored as potential acquirers in the past, and the latest speculation singles them out again.

But why would they?

RIM’s hopeless downward spiral is the result of missteps and flaws that go way beyond its inability to meet guidance. RIM has failed to innovate. It has failed to execute. It has failed to understand the consumer market, which is increasingly informing enterprise support and purchasing decisions. And its comedy-of-errors management has consistently refused to take responsibility for those failures, because it doesn’t seem to see them as a problem.

Is there anyone willing to spend $15 billion plus premium on that? The chance to turn around RIM’s foundering business? The chance to arrive late-to-market with another ill-conceived BlackBerry? To make sense of the BlackBerry OS-to-QNX transition? And then to go head-to-head with Apple and Google, which have been wiping the floor with newcomers and pioneers both?

Seems highly unlikely.

Perhaps someone will buy it for parts further down the line when they won’t have to pay such a premium. It’s getting cheaper every day …

[Image credit: The Joy of Tech]

The nation’s largest book-store chain offered no guidance for the current fiscal year as its board of directors continues to evaluate a takeover offer made last month by billionaire John Malone’s Liberty Media Holding Corp. Liberty’s closely watched offer values the chain at $17 a share, or about $1.02 billion, a valuation that some said is too low, given the possibilities for Barnes & Noble’s increasingly popular Nook e-book device in the rapidly growing e-reader market.

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A Chicago boy is going home, as former Yahoo PR exec Bradford Williams takes over as VP of Global Communications at Groupon.

Williams, who worked at Yahoo during its ugly takeover fight with Microsoft, will need his even-keeled personality more than ever now, as the social buying phenom heads into its upcoming IPO.

Groupon has gotten a lot of flack for the unusual accounting in its recent S-1 public offering filing, as well as for the huge amount of money that some of its founders have taken out of the company.

And its CEO Andrew Mason is also, well, somewhat of a death-staring character.

Williams has longtime tech experience, having also worked at VeriSign, eBay and Gateway.

He is one of many former Silicon Valley hires that Groupon has made of late, including several from Yahoo and also Google.

(By the way, that’s me calling on the other line, Brad, so get ready to pick up a lot.)

Last month, Mr. Icahn offered to buy Mentor for $17 a share, less than two weeks after saying the chip-design software company should put itself on the block. Mr. Icahn is known for targeting companies he views as undervalued and seeking changes, such as new management, to boost shareholder value.

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And while a search for Meyer’s replacement is underway, I’m told it could easily extend into the summer.

It didn’t take long for rumors about “takeover chatter” concerning AMD to emerge, and briefly yesterday, Dell was mentioned as a possible buyer. AMD shares traded up 4 percent for part of the day but closed down 3 cents during the regular session. Dell more or less shot down the rumor. During its earnings conference call, CEO Michael Dell, answering a question on acquisitions, said, “…we’re looking for relatively smaller sized ingredient acquisitions where we can leverage them with our substantial customer access and distribution.” With AMD currently trading at a valuation north of $6 billion with about $2.2 billion in long-term debt, it’s not the kind of target that would qualify as “smaller sized.”

There will always be rumors of this sort about the perennial number two in the PC microprocessor business. Those who trade on them don’t get something fundamental about AMD: That it would be a complicated company to buy and to own.

Any deal to acquire AMD will necessarily include a third party: Intel. For decades Intel and AMD have operated under a series of patent cross-license agreements that give AMD access to the crown jewels of Intel’s intellectual property, including the x86 instruction set. These patents are on the technology that make a PC a PC, and they are fundamental to the success, or failure, of both companies.

When AMD first sought to spin off its manufacturing operations into the company that became GlobalFoundries, Intel asserted that AMD couldn’t assign access to these patents to a third party without its say-so. This dispute ultimately got the two companies talking and resulted in what I like to call the Treaty of Maui, the settlement of a sweeping antitrust dispute in 2009, a story I reported at the time for BusinessWeek.

There are, however, some limits governing Intel’s conduct in this scenario. When it settled an antitrust case against it last year, Intel agreed to hold off on suing any company that buys one of its competitors for a year, in order to hold “good faith negotiations” over the terms of that patent cross-license agreement. What this all means is that any company that first concludes a deal to buy AMD will then have to pivot and face the possibility of lengthy negotiations with Intel that could, if not successful, end in a costly and distracting patent lawsuit.

Intel may turn out to be willing to play ball, and cut a reasonable deal with any new owner, but the fact remains that every so often the cross-license arrangement has to be renewed. And that’s not to say a determined buyer couldn’t ultimately cut through all this and get a deal done. Dell has $15 billion in cash and could conceivably get a deal done, and being an AMD customer could arguably benefit from owning AMD over the long term, but it has signaled that it’s not interested, and probably never was in the first place.

There are other considerations: AMD is 20 percent owned by the Mubadala Development Company, the investment arm of the Arab Emirate of Abu Dhabi, which changes the potential deal dynamic a bit. Then there’s the big question concerning the wisdom of competing with Intel. As AMD’s prior CEOs will tell you, simply grappling with Intel in the marketplace is a dangerous, thankless job.

But the complication of the Intel cross-license agreement alone should be enough to give any company mulling an AMD buyout serious pause. At the same time it should serve as food for thought for anyone wanting to trade on the latest AMD buyout rumor. This surely is not the last.

Eric Hippeau (pictured here), longtime Yahoo board member and one of its earliest investors, will be stepping down as a director, according to sources close to the situation.

In a related move, sources said Akamai President David Kenny will be joining the board of the Internet giant.

The changes become official at Yahoo’s regular board meeting on Tuesday, although Hippeau will not step down until the summer.

Rather than quit immediately, as previous board members have, he will not stand for election at its annual shareholder meeting in June.

The departure of Hippeau and the arrival of Kenny comes at a critical time for Yahoo, which has been under great pressure from investors to revive its growth and re-ignite innovation in the face of more nimble competitors.

Under CEO Carol Bartz, the company is still in the midst of a turnaround, and Wall Street has been losing patience with her and also its somewhat ineffectual board.

Hippeau has been on that board since 1996, which is approximately 132 years in Internet time.

The longtime Web investor and publisher–at Softbank and Ziff-Davis–has a lot of online experience.

Sources said Hippeau felt he had been on the board long enough and it was time to go. It has certainly been a wild ride, from insane Web 1.0 hypergrowth to a bruising takeover fight with Microsoft.

The addition of Kenny to the board is a welcome one. As BoomTown has previously reported, Yahoo had tried to bring him on before and he declined.

With both tech and advertising experience, Kenny is also a natural possibility for a board leader, as well as a potential top exec if Yahoo keeps going sideways.

According to his bio at Akamai, which he joined last fall, he is “responsible for leading Akamai’s business operations, including the company’s product groups; global sales, services, and marketing; engineering; and networks and operations.”

Before Akamai, he ran VivaKi and was a member of the management board of its parent, Publicis Groupe, the huge ad and marketing company.

Kenny ran Publicis’s overall digital and interactive strategy. He came to Publicis after it bought Digitas, where he was chairman and CEO.

Before that, the Harvard Business School graduate worked at consulting firm Bain & Company and also in marketing and strategy at General Motors.

A Yahoo spokeswoman declined to comment and Hippeau did not respond to an email query. And an email to my new bestest friend Kenny also got no response.

Dear Wall Street analysts and other investors:

Yahoo shares had a little lift today on a rumor that Microsoft was interested in buying it again, all due to a meeting that Yahoo CEO Carol Bartz and Microsoft CEO Steve Ballmer had on Monday.

Sorry to burst your bubble, but Microsoft is not buying Yahoo, as entertaining as a sequel to “Hostile Takeover Disaster” of a few years ago would be to BoomTown.

Instead, the meeting–which I had also heard about–was one of the regular ones that the pair have, to get up to speed on the progress of their long-term search and advertising partnership.

Yahoo shares, which have been stronger lately and opened at $16.91, rose a couple percentage points, but settled down by day’s end to $17.06 and were down to $17 in after-hours trading.

Note that iSuppli counts microprocessors differently than some of the other research firms. Its “other” category includes not only PC chip also-rans like Via Technologies, but also general purpose RISC chips like IBM’s Power chips that go into servers.

There’s better news, however, for the beaten-down hard-drive industry. After seeing shipments decline through the first half of the year, fourth-quarter shipments are up, as are revenues, iSuppli says. It’s clearly the result of the holiday-season demand, but welcome news, especially in light of all the worries that tablets–like Apple’s iPad–which use flash memory for storage, would whack hard-drive sales. (Though, as Digital Daily’s John Paczkowski noted this morning, the hard-drive guys still have lots to fear from tablets.)

Western Digital is holding on to its top spot as the world’s leading supplier, edging out Seagate, which has seen its share of troubles lately.

Seagate failed to come to terms with TPG Capital last month on a plan that would have taken the company private, and also spurned a takeover offer from Western Digital. Last week it moved to refinance more than $2 billion in debt, more than $500 million of which is due before the end of the year, with a combination of bonds and bank loans.