• D: All Things Digital, Thursday, July 3, 2008 11:15 AM

Kara Swisher reports that Yahoo is contemplating handing over two board seats to Carl Icahn in an effort to appease the corporate raider. Problem is, Icahn wants at least four. Four seats would certainly give Icahn enough power to make big changes at Yahoo, including the possible removal of CEO Jerry Yang. Icahn has loudly and repeatedly said he plans to replace the Yang and other Yahoo execs after he takes control of the Yahoo board. To do so, Icahn will have to win a proxy battle, which will be waged on Aug. 1 at Yahoo's annual shareholder meeting.

Meanwhile, Yahoo shares continue fall. Swisher's sources claim the two sides aren't eager to clash publicly over a possible deal, because they're worried that media attention could further depress Yahoo's stock. Shares have been trading near $20 for the past week.

And so the whisperings continue between Yahoo and Microsoft, and Icahn, Yahoo execs and major shareholders. Nothing's really changed.

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