There’s lots of news today and from over the US holiday weekend. Much of it concerns Yahoo and Google, as it often does in this column. The big buzz generated over the weekend was from the UK’s Times Online report that there was a tentative deal reached between Yahoo and Microsoft to buy the former’s search business for $20 billion.

According to the item:

Software giant Microsoft is in talks to acquire Yahoo’s online search business for $20 billion (£13 billion). The proposal forms the centrepiece of a complex transaction that would see Microsoft support a new management team to take control of Yahoo. But there is no intention of Microsoft tabling another takeover bid for the web giant, after its aborted $47.5 billion offer this summer.
It is thought that Jonathan Miller, ex-chairman and chief executive of AOL, and Ross Levinsohn, a former president of Fox Interactive Media, have been lined up to lead the new management team. Senior directors at Microsoft and Yahoo are understood to have agreed the broad terms of a deal, but there is no guarantee that it will succeed.

AllThingD’s Kara Swisher quickly shot back that the report was “total fiction” (citing a public remark from Levinsohn) and pointed out that Yahoo’s total market capitalization today stands at less than the proposed value of the deal ($15.1 billion).

While the terms of the particular deal suggested are potentially wrong, the fact of discussions between Redmond and Sunnyvale are not. Perhaps as an indication of his confidence that some sort of positive deal will be reached, board member Carl Icahn has purchased seven million more Yahoo shares, bringing his stake to just over 5 percent in the company.

A deal that actually did take place over the holiday involving Yahoo was between its mobile division and Virgin Mobile in the UK. The deal makes Yahoo the default/pre-installed search engine on Virgin Mobile phones and provides potential access to the carrier’s roughly four million customers.

But back to the leadership drama. Bloomberg earlier published a story speculating on whether current Yahoo CEO Jerry Yang’s decision to stay on as “Chief Yahoo” after his CEO successor is found will create problems for that individual, whoever he or she may be. The story also mentions the usual gang of suspects as potential Yang successors:

News Corp. President Peter Chernin and former AOL CEO Jonathan Miller are among potential candidates for Yang’s job, according to Laura Martin, an analyst with Soleil Securities Corp. in New York. Dan Rosensweig, a former Yahoo operations chief, may also be tapped . . . [among others]

Over in Europe Yahoo is losing its highest ranking executive, Toby Coppel. However his departure is apparently unrelated to Yang’s. He’ll be immediately replaced by Rich Riley, who at one time ran Yahoo’s small business unit in the US.

From Fortune comes a broader story about openings and potential openings at the top of the major search engines. It reflects on Jerry Yang’s departure, as well as openings at Microsoft and, potentially, at Google. The piece provocatively argues that Google CEO Eric Schmidt might move on (to Washington), despite his public statements to the contrary. Schmidt was a late supporter and technology advisor for the Obama campaign and presidential transition. Fortune suggests that Schmidt might want to go out “on top” rather than manage Google through its bumpy adolescence.

In the legal portion of SearchBiz today, comes a piece in MediaPost pointing out that Google and Yahoo have prevailed in a California suit against search-related ads for online gambling:

California Superior Court Judge Richard Kramer ruled that search engines are immune from liability based on the federal Communications Decency Act, which shields Web sites from liability for material provided by outside companies.
Kramer also ruled that there was no reason to issue an injunction against the companies because they had already stopped accepting gambling ads in the U.S.

A similar federal suit was settled last year because the same law had exceptions for federal crimes that potentially applied.

Speaking of litigation settlements, TechDirt agues that in settling the recent copyright litigation over its book-scanning efforts, Google has abandoned its role as legal guardian of Silicon Valley’s collective interests:

For a few years, Google’s legal team had been taking up a variety of lawsuits purely on principle. In many cases it would have been cheaper and easier to settle, but Google had made clear that it saw those lawsuits as a way to define better law — and that helped all of Silicon Valley (and, in many cases, the overall economy). Yet, in settling this lawsuit, it became clear that Google was no longer fighting lawsuits on principle, and, in fact would consider settling cases knowing that it actually made life more difficult for the rest of Silicon Valley.

I would disagree with this characterization and analysis. Google has always defended lawsuits based on its perceived self interests and this is not the first case that the company has settled — clearly. It will also likely continue to vindicate selected legal “principles” that it sees as important, which will also benefit similarly situated Silicon Valley companies. However romantic as it may seem to fight lawsuits to the end, from a rational standpoint it’s pure folly to litigate cases to conclusion if the risk of an adverse outcome is significant and the resulting law or rule would be an ongoing burden to the company’s financial position or well-being.

On the other hand, Google creates this sort of disappointment when it defies expectations because it has presented itself to the world as an idealistic company that does things for reasons other than financial self-interest.

Another (lengthy) law and values piece, this time in the NY Times, discusses the challenges that Google and YouTube face in balancing their various and sometimes contradictory missions: obeying other countries’ laws, while preserving free speech. The piece focuses on Google’s deputy general counsel Nicole Wong:

Wong and her colleagues at Google seem to be working impressively to put the company’s long-term commitment to free expression above its short-term financial interests. But they won’t be at Google forever, and if history is any guide, they may eventually be replaced with lawyers who are more concerned about corporate profits than about free expression.

It’s a fascinating article that reflects the larger conflicts and dilemmas that Google the cultural force, the brand and the profit-making corporation (all rolled into one) faces as it seeks to grow market share and profits, while not undermining core values (i.e., becoming an agent of censorship).

Another interesting NY Times piece, this time by John Markoff, discusses the massive volumes of data that are being collected from and about users. In a thoughtful way he frets about how corporations and others might potentially abuse that information:

Propelled by new technologies and the Internet’s steady incursion into every nook and cranny of life, collective intelligence offers powerful capabilities, from improving the efficiency of advertising to giving community groups new ways to organize.
But even its practitioners acknowledge that, if misused, collective intelligence tools could create an Orwellian future on a level Big Brother could only dream of.

On the market share front, formerly hostile ITV in Britain will begin running AdSense ads on its site, replacing its current banner advertising. Previously ITV chairman Michael Grade had called Google a “parasite.”

Finally the non-Google and Yahoo stories . . .

The NY Times blog Bits uses the occasion of a new outdoor ad buy to discuss Autonomy the enterprise search vendor. The billboard in question is moving from one side of California’s highway 101, south of San Francisco, to the opposite side. The angle for the post is that Silicon Valley commuters have seen the Autonomy ad for eight years yet few people really know what the company does.

No one had to say this but it’s now confirmed that the US, like much of the western world, is in a bona fide recession. We’ve all known this for awhile and rather than tanking the market should be happy because admitting the problem is the first step toward recovery. But the recovery won’t come in time for most retailers’ holiday seasons — online or offline.

There were some preliminary reports of slightly better than expected “Black Friday” in store sales. And the Internet also saw a modest uptick in online sales and related activity on Friday as well.

Today is of course “Cyber Monday” (a totally ridiculous term in my view) and comScore released data last week that doesn’t bode well for Cyber Moday or e-commerce in general this holiday season, reflecting a 4 percent decline in online sales, compared with a year ago, during November.

Finally and just in time for the holidays . . . soon to be former Federal Communications Commission Chairman Kevin Martin wants to give Americans the gift of smut-free, free Internet access. According to the Wall Street Journal:

The proposal to allow a no-smut, free wireless Internet service is part of a proposal to auction off a chunk of airwaves. The winning bidder would be required to set aside a quarter of the airwaves for a free Internet service. The winner could establish a paid service that would have a fast wireless Internet connection. The free service could be slower and would be required to filter out pornography and other material not suitable for children. The FCC’s proposal mirrors a plan offered by M2Z Networks Inc., a start-up backed by Kleiner Perkins Caufield & Byers partner John Doerr.

Related Topics: Channel: Industry | Search Biz

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About The Author: is a Contributing Editor at Search Engine Land. He writes a personal blog Screenwerk, about SoLoMo issues and connecting the dots between online and offline. He also posts at Internet2Go, which is focused on the mobile Internet. Follow him @gsterling.

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