Yahoo! restructuring on the way

According to a leaked memo that went out on Friday, Yahoo's new CEO, Carol Bartz, might be launching a major restructuring of the company this week.

Yahoo! spent much of 2008 dealing with various takeover and merger attempts. Although the company has talked with Google, News Corp, and AOL, its most persistent suitor has been Microsoft, which has been seeking a merger since 2005. In 2008, these discussions became particularly heated, with Yahoo! accusing Microsoft of massively undervaluing the company, and Microsoft threatening to approach shareholders directly in the hopes of electing a new board. In May 2008, amid threats of a "poison pill" gambit, Microsoft withdrew from takeover discussions. However, earlier last month, Microsoft took another run at the company in a plan that would essentially give them control of Yahoo's search and search marketing products.

February has been particularly busy for the company. Yahoo is still working on the massive redesign of its homepage, a much-delayed process that promises to streamline many key Yahoo! services, but which also runs the risk of encouraging users to leave the site. This delay goes hand-in-hand with a leaked "brand pride" memo in which Bartz discussed products that are an "embarrassment" to the Yahoo name. In related news, Bartz has instituted a bounty of $1000 on the head of any employees caught leaking internal memos.

Some industry observers have predicted that this week's presumed reorganization will streamline Yahoo's current, complicated structure in order to make it more efficient and transparent. This transition should be eased by the hasty departure of several execs, a process that may be related to Bartz's arrival, or may simply be reflective of a certain institutional weariness in the embattled company. Regardless, it should definitely be an interesting week for the world's most visited website!
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