Kara Swisher

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One Week of Mayer at Yahoo: Whither Ross? New Old Yahoos? More Search? Product Side “Elated!”

Good gracious, what a difference a week makes — at Yahoo, at least.

With the installation of former Googler Marissa Mayer as its new CEO, the troubled Silicon Valley Internet giant bought itself a boatload of attention for the bold choice, and another tanker full of champagne dreams that it might have finally gotten a leader to take it out of its perpetual state of perpetualness.

“Let’s be clear, she is our last hope,” said one board member to me, a sentiment that I also heard from another; and so, too, from a lot of execs and rank-and-file around the company.

I am entirely not clear what comes after “last” — but I presume it ends with “sale.”

Nonetheless, that kind of do-or-die tone was also echoed all over the place outside the company, as investors and others tried to digest the news.

Opinions so far are largely in Mayer’s favor — as in, she shall fix all that ails Yahoo — but others properly stressed that the task she faces is perhaps unfixable by anyone.

We’ll see, won’t we — and not soon? Because it is a task that should and will undoubtedly take Mayer years to accomplish — and the board appears to have given her much time to do so.

And while it is not clear whether investors have that kind of patience — Yahoo stock has hardly budged since the announcement — the long game is probably what you might also expect from Mayer. Because, though she is known for being quite decisive, she has also never seemed to show a proclivity for quick-trigger moves without careful and often data-driven reasons for acting.

But, according to numerous sources at the company, there are some key things she has done this week that could give some signals to where this ship is headed under its new captain.

Here are four key developments and issues to pay mind to:

Who’s on First?

The team Mayer picks to help her in her thankless task of reviving Yahoo should say a lot to people about her direction.

First and foremost is whether she will choose to keep on the man she aced out for the job of CEO, Ross Levinsohn.

He’s the media guy, and he’s got a pretty loyal team of staffers behind him, including recently hired sales superstar Michael Barrett. They are all reportedly beside themselves by the turn of the game not in Levinsohn’s favor.

That said, Levinsohn has largely remained quiet since Mayer’s appointment, and will likely remain so until he either stays or goes.

Sources say that Mayer wants him to stay — which makes sense for now, especially since his expertise and tight relationships with the advertising world are not hers as yet. Levinsohn is also, incredibly, one of the longer-tenured top execs, so he has some important historical knowledge that is valuable to Mayer.

Also, she has more critical things to do than continually gladhand advertisers, although a lot of the success of her job will depend on this, for a while, at least.

That said, it’s not clear whether Levinsohn (pictured here) wants to stay around after losing out to Mayer, and he certainly has ample opportunities across the media landscape to escape to.

In addition, sources said that Mayer herself has a lot of other choices waiting in the wings, including a range of Google execs and others. Here’s another former Yahoo suggestion: Sales exec Joanne Bradford, who is now at Demand Media (sorry, Richard!).

My guess — and this solely is based on me watching this Yahoo drama for far too long — is that it is still unlikely that Levinsohn remains. That is, unless the company hands over a large pile of compensation, an even bigger title, like COO, and, of course, some well-aimed persuasion by Mayer.

What could be more interesting is if Mayer brings back some ex-Yahoos to help guide her. One rumor sweeping Yahoo late last week was that longtime general counsel Mike Callahan — who just left — should be enticed to return. It’s not a bad idea, given he is well versed in key issues around Yahoo’s search and advertising partnership and the negotiations of its Japanese assets.

Perhaps what’s more important is who Mayer deems as her product lead. While she is that overall, of course, sources said she has been relying this week on former Googler Shashi Seth, who has been in charge of a number of product areas at Yahoo for a while now.

“Shashi has been smiling from ear to ear since Marissa arrived — he can’t contain his glee,” said one person.

What’s entirely clear is that Mayer needs to quickly upgrade product and engineering talent at Yahoo, in order to pull off the big changes she has been charged with by the board.

Another key hire that needs doing soon: A head of corporate communications, although Mayer appears to have more than enough PR to last her a while.

Pumped Up Kicks

Morale has been very low at Yahoo, which is why the bright shininess of Mayer seems to have put a lot of the long-beleaguered Yahoos on her side.

“I think we have a ballgame now! It’s amazing how fast the sentiment changed internally,” said one person in the product org, in what has been a common refrain. “Everyone [is] ELATED. People I know that were close to leaving (including myself) are now giving it another shot.”

Said another source, who has spoken to many on the advertising side: “I know it sounds silly, but now — instead of leaving, everyone wants to wait around and see what she does.”

And how she does it.

One plus: She has appeared getting her own lunch in the cafeteria, which has delighted more employees than you might imagine at Yahoo.

So far, the style under the Mayer regime seems to be straightforward, taking no-nonsense to new heights.

In what appears to be a whirlwind of fact-finding meetings with Yahoo employees since right after she started last Monday — no all-hands for her off the bat — Mayer has been asking questions and taking in information.

In that effort, she has variously been described to me as “curt,” “whip smart,” “suffers no fools,” and “a sponge.”

That’s meant, of course, a jockeying to get said information in front of her, with the product people rushing to the forefront and putting forth their case that they have been neglected for far too long.

Mayer’s most critical ally in her early stages appears to be the quiet and retiring Yahoo co-founder David Filo, who emerged to be a vocal supporter of her from the start. That he gave a quote in a press release and did interviews — my nickname for him has long been “Silent Bob” — should say a lot to anyone paying mind.

And it is an important morale booster. While the founders of Yahoo have their definite ups and downs, the heart of the company is still with both Filo and also Jerry Yang.

And when Yang shows up again — even if only in spirit — it would be an important sign.

You Take the High Road, I’ll Take the Tech Road

That’s especially true since a lot of the direction Mayer appears to have suggested she is heading in is all about building up tech again at Yahoo.

That could mean everything from getting back in the search game to contextual platforms to juicing up its much-suffering ad-tech services.

Some of this had been pushed under former Chief Product Officer Blake Irving, projects that Mayer could simply push the “go” button on.

Some big initiatives on the burner at Yahoo that she must mull: A wide-ranging integration with Twitter, which would be similar to Yahoo’s efforts with Facebook; a reboot of its Right Media unit, rather than a sale that would have likely occurred under Levinsohn; a pushing out of a mysteriously named Project Zed, which appears to be about making Yahoo content more relevant across many devices; and a revival of still-important units, like its Flickr photo unit.

Also important to watch is what Mayer cuts, which is also probably in the cards, and will mean more layoffs at Yahoo.

While many think a halving of the company’s workforce is in order, it’s not clear where Mayer comes down on this tough one.

The New New Thing

Of all the things Mayer will do to fix what’s wrong at Yahoo now, her new ideas will be what makes or breaks her tenure.

There are so many product directions she could go in that the choice is both staggering and more than a little paralyzing.

Of course, she’ll have to pick, because — as it is often said — when you don’t know where you are going, any road will take you there.

That will no longer do at Yahoo, where clear choices must be made for a fresh start.

What about a new kind of commerce hookup with retail giant Walmart, for example, where Mayer serves on the board? Why not become a video Switzerland for all the competing content makers out there? What about really committing to content all-in, a la AOL and its Huffington Post Hail Mary? Could she make a startling purchase of something big, such as Hulu or Zynga?

Mayer has a truly green field, for example, in mobile — an arena where Yahoo has tried and tried again (and failed and failed again). But given how important the sector has become in delivering digital goods and services to consumers, it is a clear must-win.

As the New York Times’ crafty David Carr noted in an excellent column about Yahoo’s intractable sword-in-the-stone question of “What is Yahoo?” — a query that has eluded its leaders for years:

“Taking that desktop franchise, a 10-pound bag of stuff if there ever was one, and cramming it into the one-pound bag of mobile space will require difficult choices, which will have to be settled by asking the same question over and over: what is Yahoo?”

Yes, what is it? Or, more precisely, what is Marissa Mayer’s Yahoo?

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik