Yahoo Search For New CEO Nears Close

As posted by: Wall Street Journal

Yahoo Inc. is in the final stretch of its search for a chief executive officer, and a decision could come as soon as next week, said people close to the Internet company.

Among candidates still under consideration is Carol Bartz, the former chief executive officer of Autodesk Inc., a publicly traded company that builds design software used in engineering also offering Autodesk Training. She's "on the list," said a person familiar with the matter, adding that she has impressed the Yahoo directors she has met so far.

A Yahoo spokesman declined to comment. An Autodesk spokeswoman said Ms. Bartz was traveling Thursday and couldn't be reached for comment. Her candidacy was first reported by the Web site AllThingsD.com, which is owned by Dow Jones & Co., publisher of The Wall Street Journal.

Whether Ms. Bartz is a backup candidate or a front-runner remains unclear. People familiar with the matter said the board is leaning toward an external pick at this phase, as it winds down a search it formally announced on Nov. 17. Former Vodafone Group PLC Chief Executive Arun Sarin, whom the Yahoo board had been seriously considering, has withdrawn his name, according to people familiar with the matter. Mr. Sarin didn't return requests for comment.

The board has yet to make an offer and is unlikely to before next week, said people close to the company. At the latest, Yahoo is hoping to announce a new leader before it reports fourth-quarter earnings at the end of the month, they said. Once Yahoo board members agree on a candidate, the company also will have to negotiate an employment agreement. That sometimes takes a few weeks.

Choosing Ms. Bartz, 60 years old, would indicate that Yahoo is looking for a steady hand who has run a public company over someone with Internet and online advertising experience. If the board heads in that direction, the company could also seek to hire another senior executive with more extensive consumer product experience, which analysts and investors argue Yahoo needs to better compete with Google Inc. and other rivals.

Ms. Bartz still serves as executive chairman of Autodesk, of San Rafael, Calif., which she ran as chief executive from 1992 to 2006. Autodesk is around half the size of Yahoo, with approximately 7,000 employees world-wide. In its fiscal year ended January 31, 2008, Autodesk reported $2.2 billion in revenue. Yahoo's revenue in its fiscal year ending December 2007 was $6.97 billion.

Ms. Bartz was also an executive at Sun Microsystems Inc. and she sits on the board of Cisco Systems Inc., with Yahoo's Chief Executive and co-founder Jerry Yang. She is also a member of the Intel Corp. board with Yahoo President Susan Decker.

Microsoft Wins Key Search Deals

As posted by: Wall Street Journal

LAS VEGAS -- Microsoft Corp., facing a bleak economy and rivals that have outflanked it in the consumer market, announced a milestone for the next version of Windows and a raft of deals designed to boost its online-search business.

The company showed a preliminary version of Windows 7, the next major edition of its flagship operating system, available for consumers to test on their personal computers starting Friday. Microsoft also announced a five-year deal with Verizon Wireless to make its Internet-search service broadly available on the wireless carrier's mobile phones and a similar agreement with Dell Inc. covering that hardware maker's PCs. The Microsoft agreements displace an existing search deal that rival Google Inc. had with Dell and another that Google was previously negotiating with Verizon.

The plans were unveiled Wednesday evening at the Consumer Electronics Show here by Microsoft Chief Executive Steve Ballmer, in his first stint delivering a keynote speech at the annual trade show. For years, Microsoft chairman and co-founder Bill Gates had kicked off the event and anchored Microsoft's presence there, but Mr. Gates last year stepped away from day-to-day involvement at the Redmond, Wash., company to focus on philanthropy.

Microsoft CEO Steve Ballmer delivers keynote address Wednesday at the Consumer Electronics Show in Las Vegas.

Mr. Ballmer took the stage for Microsoft at a time when much of the technology industry is on edge about the impact that the weakening world economy will have on demand for their products. The consumer initiatives Microsoft has unveiled at the show have at times tilted toward gee-whiz technologies like wristwatches that receive weather updates, but didn't end up selling well.

Microsoft lavished the most attention on Windows 7, the successor to Windows Vista, which received poor reviews when it came out two years ago.

During that same time, Apple Inc. has made small gains in the consumer market with its Macintosh computers, even though Microsoft still retains an overwhelming advantage. Windows 7 has new features designed to make it work more easily with devices like digital cameras and home networks.

Microsoft is placing a heavy emphasis on its speed, promising it will run well on everything from high-performance PCs to Netbooks, inexpensive laptops that have become a hit in the down economy.

At CES, Microsoft announced that developers who participate in Microsoft's technical programs could download the "beta" or test version of Windows 7 starting Wednesday night. The company will open that invitation to the wider public Friday, though it plans to limit the number of downloads to about three million.

Microsoft released an earlier test version of Windows 7 in October, though the version it is now offering includes all the final features expected in the software. Microsoft has said previously that it plans to ship the final version of Windows 7 by January 2010. Microsoft's distribution deals with Verizon and Dell could provide a lift for its search business, which has lagged far behind Google in share of queries by Internet users.

The agreement with Verizon, starting in the first half of this year, will make Microsoft's search engine easily accessible from nearly all of the handsets from the carrier, a joint venture of Verizon Communications Inc. and Vodafone Group PLC.

Time Warner Takes $25 Billion Hit

Aol On Deathbed

Responding to past problems and the future perils of the economic downturn, Time Warner Inc. attempted to clear its slate by writing down $25 billion of assets to account for the tumbling value of its cable, publishing and AOL businesses.

The move, coming as the advertising outlook sours, could signal more write-downs for media and cable companies. After a rash of acquisitions at peak prices, companies in those industries are having to scale back accounting values in the now-sullen climate. The media industry also faces secular declines in areas such as newspapers, broadcast television and radio, which are being ravaged by ad declines.

Time Warner CEO Jeff Bewkes has signaled a shift to focus more on the TV and movie businesses.

Coupled with weaker-than-expected advertising revenue,Time Warner's fourth-quarter write-down is expected to swing the company to an annual loss for 2008 -- its first in six years.

Time Warner Cable Inc., whose shares have fallen 50% in the past couple of years, represented the bulk of the non-cash write-down, at nearly $15 billion. The news also highlights the lingering effects of Time Warner's disastrous 2001 merger with AOL and a gloomy outlook for the magazine-publishing business.

Time Warner has made a slew of acquisitions since the company's last major write-down in 2002 for the value of AOL and its cable systems. Time Warner Cable spent about $9 billion of cash and 16% of its equity acquiring assets from rival Adelphia in 2005. AOL also has been on a buying spree in its bid to revamp itself as an ad-based company. Investors chided AOL last year for the steep $850 million price tag of its Bebo acquisition.

Cable-TV company Comcast Corp. similarly plans to write down its stake in wireless broadband company Clearwire Corp., whose shares have fallen about 60% in the past 12 months, said people familiar with the situation. Last October, CBS Corp. recorded a $14.1 billion charge, largely for the shrinking value of its local television and radio stations. "We believe that similar announcements from other media companies could be forthcoming," said UBS analyst Michael Morris.

Time Warner's write-down says a lot about the challenges that face Chief Executive Jeff Bewkes. Mr. Bewkes has signaled a shift to focus more on the TV and movie businesses and less on non-content assets such as Time Warner Cable, which he expects to spin off by the end of the current quarter.

But he still needs to find long-term solutions for AOL and publishing. Time Warner CFO John Martin, speaking at an investor conference, said the company is still interested in finding AOL a partner, after on-off talks with potential candidates, but noted the current climate "is not conducive to" quick action.

Time Warner rang more alarm bells about the advertising climate, saying "the economic environment has proved somewhat more challenging" than previously expected, particularly at its AOL and publishing units. The company scaled back its operating projection for 2008, saying it now expects adjusted operating income before depreciation and amortization to be $13 billion, up 1%, a drop from its previous forecast of a 5% increase.

Time Warner shares were down 6.3% at $10.29 in 4 p.m. composite trading on the New York Stock Exchange, while Time Warner Cable stock was down 4.8% at $21.56.

In addition to the write-down, Time Warner will record charges of as much as $380 million in the fourth quarter, including as much as $60 million from the restructuring of a lease for floors in its Time & Life Building in Manhattan held by Lehman Brothers Holdings Inc.; a $40 million increase in its credit-loss reserves for bankruptcy filings by retail customers; and $280 million for a court judgment against its Turner Broadcasting System Inc.

Time Warner still expects cash flows for 2008 to total $5.5 billion, matching its outlook provided in November, because of strong performances from its film division and its cable-television networks.

Time Warner was expected to come under pressure to write down assets as it carried over $42.5 billion in goodwill on the books for 2008. Mr. Martin said he expects no "adverse impacts" from the write-down, noting there are no debt covenants or tax implications that will lead to more financial pain.

The Time Warner Cable write-down reflects the decline in the market value of the company, a drop in the value of its franchise rights and lowered expectations for cash flow amid increased competition and higher borrowing costs. Time Warner Cable said it also plans to take a charge of about $350 million related to its investment in Clearwire.

Time Warner is to report fourth-quarter earnings Feb. 4.