Most notable about the AOL hot searches feature this year is the ability to view the UK and Canadian top searches independently, by clicking each country flag to view the differences in search behavior among all three countries.

As AOL has over 60 million montly unique visitors in the UK alone (Comscore May 2011), Brits turned to AOL for the latest on major news events such as the London Riots and the Red Arrows crash. Interestingly, Twitter and Google+ both made the top 10 memes list in the UK as well.

With the worldwide buzz surrounding the Royal Wedding, it’s also not that surprising that British beauties Kate Middleton, Amy Winehouse and Pippa Middleton appeared on all three country lists with the headlines they each made respectively in 2011.

Also in the celebrity wedding category, it was a pleasant surprise to see Reese Witherspoon topped Kim K & Kris H for wedding related searches in the US, and searches related to Sir Paul McCartney’s nuptials to third wife Nancy Shevell put them the top 10 as well as 9 other couples, all of whom who have thus far been married longer than 72 days.

New this year on AOL’s top searches list are the question categories, gives insight into the most popular questions consumers asked of the search engine in 2011. While the question format certainly isn’t new to online searchers, it is the first year AOL has shared that data.

AOL has created a special section for ranking the hottest trends in search during 2011, where you’ll be able to see more categories including Sports, Music, TV, Tech Gadgets and travel destinations, in addition to the ones below. You’ll be able to click through each top 10 to the relevant search results.

One quick shout-out on the top travel destinations – my home state of Maine came in 8th for “Maine Vacations” – a rare, but well earned appearance, perhaps following the 2010 vacation of the presidential family, or the fact that celebrities like John Travolta, Martha Stewart and Kirstie Alley have vacation homes there.

Top 2011 AOL Search Highlights

Celebrities

1. Charlie Sheen
2. Justin Bieber
3. Kate Middleton
4. Jennifer Aniston
5. Kim Kardashian
6. Tiger Woods
7. Lindsay Lohan
8. Amy Winehouse
9. Glenn Beck
10. Pippa Middleton

Memes

1. Ted Williams
2. Planking
3. Serene Branson
4. Anonymous
5. My Little Pony
6. Ancient Aliens
7. Nyan Cat
8. Rebecca Black Friday
9. Tiger Mom
10. Qwikster

Presidential Candidates

1. Barack Obama
2. Herman Cain
3. Michele Bachmann
4. Rick Perry
5. Ron Paul
6. Mitt Romney
7. Newt Gingrich
8. Rick Santorum
9. Jon Huntsman
10. Gary Johnson

How…

1. How can I pay off my credit card?
2. How tall is Katy Perry?
3. How can I stop snoring?
4. How did Valentine’s Day start?
5. How do you lock your scroll bar?
6. How much is my jewelry worth?
7. How many ounces in a gallon?
8. How do I change my AOL password?
9. How much should I weigh?
10. How did Punxsutawney Phil get his name?

Is…

1. Is Whitney Houston pregnant?
2. Is the iPhone 3GS free?
3. Is Dolly Parton her real name?
4. Is Cancun safe for tourists?
5. Is Roseanne Barr a nut farmer?
6. Is heartburn a sign of pregnancy?
7. Is shingles contagious?
8. Is Facebook going to charge?
9. Is there life after death?
10. Is rosemary good for stretch marks?

Why…

1. Why did Dick leave Big Brother?
2. Why did the original Becky leave Roseanne?
3. Why did William and Kate split in 2007?
4. Why did Paul Ryan found the Young Guns program?
5. Why did the chicken cross the road?
6. Why did Glenn Beck leave Fox?
7. Why did Ricky Gervais quit Twitter?
8. Why did Japan attack Pearl Harbor?
9. Why did my hair thin after giving birth?
10. Why did Jerry Lewis leave MDA?

The agreement is also aimed at reducing the amount of inventory that’s going to ad networks, where pricing is lower than the companies think they can charge themselves. Yahoo, Microsoft and AOL are also hoping to get other large Web publishers to join the consortium.

According to All Things D, the idea is that the publishers will contribute their “Class 2 display” inventory — ads they weren’t able to sell themselves and would normally fill with ad network inventory.

The challenge for all of the parties will be to train and encourage their sales team to sell inventory on what are, essentially, competitor’s sites. The report says each of the publishers will be responsible for encouraging their sales forces to sell the consortium’s inventory.

The partnership isn’t exclusive and allows any of the Web publishers to work with other ad networks, including Google, according to the story. According to an IDC report, Google overtook Yahoo in terms of display ad revenue share in the first quarter of 2011 for the first time.

Display revenues were up 14 percent overall, 16 percent in the US. However search and contextual ad revenues were down 21 percent. No one is very upset about the decline in search revenues given that analysts don’t expect much from AOL in this category anymore.

AOL’s search market share has been declining over time and so it comes as little surprise that its search revenues are also disappearing.

US search market share: Google vs. AOL

Below is a listing of the logos from Google, Yahoo, Bing, Ask.com and other search engines that have special logos up for Mother’s Day.

More Fun Google Logos:

• Google’s Royal Wedding Logo
• Your Guide To The Royal Wedding 2011, Social Media Style
• What Time Is The Royal Wedding? Google Tells You With Special Box
• John F. Kennedy Inaugural Address Google Logo
• Will Eisner Google Logo
• Google Logo Honors John James Audubon’s Birthday
• The Harry Houdini Google Logo
• Google’s Interactive Earth Day Logo

Today on Google’s home page is a special interactive Google logo for Earth Day. Earth Day this year falls out on Good Friday and for the special day, Google made a fun, animated and interactive Google logo.

Ironically, it seems as if you have Pandas playing (see the Google Panda update), the logo also has birds flying, fish swimming, lions sleeping, penguins sledding and much more. Here is a video me interacting with the Google logo.

Google was not the only search company celebrating Earth Day with a special logo, so is Yahoo, Bing, Ask.com, AOL and others. Here they are:

Yahoo:

Bing:

Ask.com:

AOL:

Search Engine Roundtable:

Related Stories:

• Google’s 2010 Earth Day Logo Impresses
• Earth Day Logos From Google, Yahoo & Others – 2009
• Earth Day Logos From The Search Engine Industry – 2008

Yahoo reportedly didn’t receive any formal offer or proposal, however, so it’s hard to know how serious any of this is or was. The article goes on to document some of AOL’s ongoing challenges in the market, though it has had some successes under new CEO Tim Armstrong.

Meanwhile the Wall Street Journal is reporting, consistent with earlier speculation, that Yahoo is about to cut about 5 percent of its workforce, or roughly 650 people:

Judge Marsha Pechman agreed with both Google and AOL, who said that Allen’s lawsuit was too vague. Allen’s patent infringement complaint “failed to identify the infringing products or devices with any specificity,” Pechman wrote in her ruling. You can read the full decision on Groklaw.

Allen has until December 28th to refile the case.

He first filed the lawsuit in late August, accusing 11 companies — including Google, Yahoo, AOL, and Facebook — of infringing on technology developed a decade ago by Interval Research Corp., a technology lab that Allen owned between 1992 and 2000.

There’s more discussion on Techmeme.

Both Yahoo and AOL are focused primarily on display advertising with content creation driving page views. There’s a lot of similarity and a lot of overlap.

Reuters is saying that AOL is exploring how the company might break itself up, through a “complicated series of transactions,” and then sell the biggest and most strategic part of itself to Yahoo. Quoting the ever-present “unnamed sources” the article says that similar breakup plans were originally hatched within TimeWarner but aborted because of potential tax liability associated with such a maneuver.

One piece of AOL that would readily be shed is dial-up ISP business:

This strategy is dependent on the buyers for the parts, including Yahoo and EarthLink, whose directions have changed since Time Warner first considered these plans, said the sources.

EarthLink, for instance, was once a willing and capable buyer of AOL’s cash-generating dial-up business. But it has agreed to buy DeltaCom Inc for $516 million, tying up most of its free cash and is unlikely to pursue another big transaction for now, another source said.

Yahoo’s interest or capacity to buy AOL is still unclear. But it would take away a competitor and provide some additional reach and assets. AOL’s market cap today is $2.69 billion so the idea isn’t outside the realm of possibility. Presumably separating the dial-up business would make it even more “affordable” for Yahoo.

By comparison Yahoo’s market cap is $21 billion. However it only has about $3 billion in cash on hand. If Yahoo had Google’s bank account buying AOL would probably be a no-brainer.

AOL is trying reinvent itself under former Googler Tim Armstrong. The company, however, saw a steep ad revenue decline in Q3, though earnings were positive. So I suppose it’s appropriate to “explore” options if organic activity isn’t doing it for the company. AOL is public, of course, and must generate positive momentum to maintain and grow its share price. Absent organic growth more extreme measures will be demanded by shareholders.

Kara Swisher at AllThingsD, which is owned by the WSJ’s parent corp, critiques the WSJ piece and smacks down the rumors as spin probably started by bankers themselves (“unnamed sources”) hoping to generate some momentum around the idea of an AOL-Yahoo merger, as well as related fees:

it’s likely it was just those dealmakers, looking to gin up some activity, who are behind the latest spin-riffic article in The Wall Street Journal that reports on machinations by AOL to hire unnamed advisers to carry out all kinds of complex deals

AOL and Yahoo have very similar strategies and both occupy similar positions in the market. They’re both companies that get most of their revenue from display advertising and are seeking to be content producers and aggregators to drive page views and related display impressions.

A merger of the two companies would probably be incredibly disruptive of whatever momentum they each have, result in the loss of hundreds of jobs (maybe thousands) and cause them to lose at least  year while the “integration” took place.

As we know from many failed/disappointing acquisitions or mergers (e.g., AOL-TimeWarner, eBay-Skype, AOL-Bebo, News Corp-MySpace, etc.) bankers make a lot of money in such situations. But what comes out on the other side doesn’t necessarily succeed. Indeed, there’s little guarantee that a combined AOL-Yahoo would do much better than either of the respective companies as independent entities in the market.

Bloomberg has more this morning suggesting that, as with Microsoft a couple of years ago, Yahoo is positioning to fight a takeover. One of the very hypothetical scenarios involves taking Yahoo private to “avoid the scrutiny of the public markets,” allowing the company to make some of the “tough choices” necessary to really turn it around.

Such a scenario would not involve AOL obviously. But there are several others being discussed and speculated about today. Wheels within wheels.

How unfortunate for everyone at Yahoo: more takeover drama. But all this last night led me to think, what happens to the Microsoft-Yahoo search alliance if a deal with AOL actually happens?

Recall that AOL renewed its search deal with Google for five years, and there’s a deeper relationship now than before. The Microsoft-Yahoo relationship is a ten-year deal. While there might be a way to reconcile them and allow them to operate in accordance with their terms, as a practical matter that’s probably impossible.

AOL and Yahoo would want to combine operations to eliminate inefficiency (and jobs) and the companies would ultimately want to work off the same “platforms.” Again this is super-speculation but it seems that either Microsoft or Google would be a loser in an AOL-Yahoo merger.

Would one of them be compensated for the lost value of the contract? Microsoft would immediately lose share and major reach for adCenter advertisers (the whole point of the “search alliance”). Google would be less directly impacted in terms of share but would also lose revenue and reach. I would imagine negotiations with Microsoft or Google would be very challenging and add to the cost of any potential AOL-Yahoo merger.

It seems to me a potentially thorny legal and financial issue that could become a major obstacle to any successful takeover or merger effort involving the two companies.