Yahoo gets new CEO, could bolster Microsoft deal

Yahoo has announced that Former Autodesk CEO Carol Bartz will serve as the new CEO, replacing the company founder Jerry Yang who acknowledged his departure several months ago. The transition could bolster fresh negotiations with Microsoft, given that Yang was heavily criticized for killing the original acquisition deal. Interestingly enough, Microsoft recently hired a Yahoo former executive, Qi Lu, to run its Online Services Group. Lu will direct the software giant's online search and advertising projects relating to Windows Live.

Bartz is best known for her leadership at Autodesk, where she worked for 14 years as the company increased revenue from $300 million to $1.5 billion and the share price sustained an average annual gain of 20 percent. Her experience as a tech-company executive also includes positions held at Sun Microsystems, Digital Equipment Corporation and 3M.

Roy Borstock, another vocal opponent to the original Microsoft deal, welcomed her to the company and expressed confidence that she "is exactly what Yahoo! needs to get back on a path toward achieving its full potential." Yang also agreed with the choice, although he will stay with the company as Chief Yahoo to provide support.

Sue Decker also announced her resignation from Yahoo as president, although it remains unclear if her choice was driven by a disagreement with the board regarding hiring an outsider.

Steve Ballmer, in an interview last week with the Financial Times, alluded to the possibility of renewed negotiations with the search-engine company. Yahoo's market value has fallen to less than 40 percent of the software giant's original offer, although Ballmer ruled out the chance of a full takeover in future dealings. His comments point to a focus on acquiring the company's search engine and search advertising segments.

"We now have someone [Qi Lu] in place running our online business, and Yahoo's out looking for a CEO," Ballmer said. "If a search deal is to be made, it's probably to be made in the interim period for new leaders in both places." The company has not publicly confirmed that it hired the Yahoo executive in an attempt to kindle fresh negotiations.

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Other story tags: Microsoft, Yahoo