Yahoo Fights Microsoft Takeover

While financial analysts find that a Microsoft buyout is inevitable, Yahoo today aimed unveiled a new three-year financial plan of independence while the company continues to find new revenue sources.

Yahoo has been demonstrating that its search engine company should remain independent. That was followed up with a three-year financial plan for nearly doubling its operating cash flow and generating $8.8 billion in revenue in 2010.

The plan was first presented to Yahoo’s board of directors in December 2007, more than two months prior to Microsoft’s $45 billion acquisition bid on February 1.

Yahoo also mailed a letter to all shareholders on February 13, aimed at fending off a takeover by Microsoft.

“Our goal is to grow visits to key Yahoo starting points and properties, where users enter the Internet, by 15% per year over the next several years. We are the most visited site in the US, and we continue to grow — we experienced double-digit growth in US users in 2007 on our home page,” Yahoo CEO Jerry Yang said.

According to a poll released by Reuters this week, all eight Microsoft analysts surveyed thought Microsoft would prevail in its takeover attempt, so did 14 Yahoo analysts.

Yahoo is making an attempt to generate more revenue already by making a series of targeted product and partnership moves which have been receiving mixed reviews from industry observers.

One example, Yahoo has announced new technology labs in Bangalore, India and Haifa, Israel; a strategic partnership with T-Mobile; a product called OnePlace for managing mobile content; a new “starting point” service known as “Buzz”; and the expansion of its newspaper ad consortium to include one-third of all US newspapers.

Yahoo also revealed in a blog posting last week that it is exploring adoption of semantic Web identifiers in its searches, an approach which differs from that of rival Google. Under semantic search, the meaning of the data on each Web page is analyzed so that its relevance to a single context can be ascertained.

“By supporting semantic Web standards, Yahoo Search and site owners can bring a far richer and more useful search experience to consumers,” Amit Kumar, product management director for Yahoo Search said.

However, critics say that many existing Web pages would need to be retagged for semantic search to become useful.