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What's Next For Yahoo?

Yahoo Chairman and Chief Executive Terry Semel has the backing of company board members to continue Yahoo's "transformation" into a more competitive rival against Google. The picture painted on Wall Street, however, is that Semel has been one step behind the behemoth, out-Googled on potential acquisitions that would have narrowed the gap between Yahoo and Google. Semel balked at buying Google in 2002 for a price in the single billions, but the company's stock value is now $145 billion -- three times that of Yahoo's. In addition, when Semel took an interest in buying YouTube and DoubleClick, well, we know how that turned out: Google swooped in and purchased them both, leaving Yahoo to acquire similar, but smaller companies. Insiders named Microsoft and eBay as viable partners for Yahoo to lessen Google's lead.

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