• by April 8, 2004

A rising tide lifts all boats, right? The adage appears to hold true, at least in the case of Yahoo!, which yesterday posted spectacular first quarter earnings. Shares of the Internet giant climbed 13 percent to $55 on its news. Yahoo! racked up $758 million in sales for the first quarter, up from less than $300 million in the year-ago quarter. My, what a difference a year makes.

Yahoo!'s news rubbed off on other players in the interactive universe. Ask Jeeves saw its shares rise 5 percent to $39.75, while aQuantive, the parent company of Avenue A , Atlas DMT, and iFrontier, also had a 5 percent share lift to $11.83. Shares of Viewpoint rose 7 percent on the news; the rich media technology provider recently entered into a deal with Yahoo! to offer graphical searches. ValueClick's shares rose 9 percent to $11.84 and Switchboard's notched 11 percent to $44. And those are just a few of the gainers.

The improved online advertising picture has a ripple effect on an array of search and paid listings companies, behavioral targeting firms, and enabling technology providers. A rising tide does, in fact, lift most boats.

Commenting on Yahoo!'s earnings picture, CEO Terry Semel said he projected a 35 percent growth rate for the company's advertising business this year--that's up from prior projections of 25 percent to 30 percent.

The thing is, I kind of expected as much from the Yahooligans. They've been plugging away with brand advertisers, building audiences and traffic, and diversifying the business. Yahoo! is on its way to becoming a global power brand. For 2003, Yahoo!'s global online advertising revenues hit $1.2 billion, representing 12.8 percent of worldwide online advertising revenues, according to eMarketer, the aggregator of online media data. Taken together, Yahoo!, Microsoft Corp.'s MSN and Time Warner's America Online represent 31 percent of global online ad revenues in 2003--that's $9.4 billion.

And this just in, on a lighter note: Google may have stolen Yahoo!'s search crown, but the yodel company has something Google doesn't--a soul-search capability, at least according to The Onion. The soul-search function is apparently able to navigate "billions of thoughts, experiences, and emotions that make up the human psyche."

The new function apparently allows users to link into Yahoo!'s network, to properties like HotJobs, Shopping, and Travel. It's also customizable, "Users can set their search to plumb their souls at varying depths, to make shallow discoveries or life-changing ones. They can also adjust their security preferences to protect themselves from the dangers of baring their naked souls to the world ..." While soul-searching Yahoo!'s online personals is not yet an option, the company is apparently working on a search engine that will help folks "find their one true soulmate."

Come to think of it, the soul-search could be an integral part of Yahoo!'s social networking service which the company hinted at.

After all, Yahoo! is the "life engine;" that's not so different from a "soul" engine.