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What’s Next for Yahoo After Carol Bartz?

Is there space for Yahoo?

The sudden firing of Yahoo CEO Carol Bartz — over the phone, no less — has put speculation about the struggling Internet company into overdrive. CFO Tim Morse was put in charge for the interim, but the search for a replacement is already underway. (Snoop Dogg threw himself into consideration early by tweeting: "Im takn over as tha CEO of Yahoo. Need sum of tha Snoop Dogg content ya digg. Nuff Said.") On a call this morning, director and former CEO Jerry Yang told his people that Yahoo is "not for sale," but absolutes are hard to take seriously when the vision for the future is murky at best and the board is getting anxious, as evidenced by their unanimous axing of Bartz. Karah Swisher of All Things D, who has been all over the Yahoo coverage, reported last night that the company would likely bring in investment bankers and advisory firms to guide potential strategies "including possible acquisitions, shedding units, bringing in new investment partners and even taking the company private or selling it." But what are their real options?

An outright sale is least likely, Swisher reported, but "it is all on the table." If Yahoo hopes to position itself as a "premier digital media company," they'll have to show investors, users, and partners exactly what that is.

Possibilities for a CEO include much of the Silicon Valley elite, but range from the barely realistic, such as Facebook COO Sheryl Sandberg (who already has quite a cushy job, not to mention an upcoming IPO) to the already busy, like AOL's Tim Armstrong, who faces similar problems where he already works.

Also in the less-than-likely camp, Business Insider's founder and ex-Wall Street analyst Henry Blodget offered to sell his website to Yahoo for $150 million and take over as CEO, but insists he'd only have the job long enough to right the company's course.

The Wall Street Journal, meanwhile, reports that Morse's time as an interim CEO could be "just long enough for him to orchestrate the sale or breakup of the company." Putting a numbers guy in charge, according to one analyst, "indicates the direction they're going."

So far on Wednesday, Yahoo shares are up about 5 percent to $13.57, but those gains reflect the anticipation of an M&A premium rather than optimism for the overall business. A few years ago, when shares were above $30, Microsoft considered purchasing Yahoo, but "prospects for an outright sale are weaker now," the Financial Times reports. Google and Facebook, which has seen huge profits this year already, are currently squashing Yahoo in the world of online advertising, a market Yahoo once dominated. Neither would have much to gain by buying Yahoo. Microsoft is again being floated as a potential buyer, but their $47 billion final offer last time looks positively dreamy in the face of Yahoo's market value today, which is closer to $17 billion.

Another move being considered, which Bartz was fighting, would be for Yahoo to sell its shares in the Alibaba Group, which Yahoo bought a 40 percent stake in for $1 billion in 2005. The company owns e-commerce businesses in China and would like to buy back shares from Yahoo, but Bartz was holding out for "the most value" in a potential sale. The Yahoo-Alibaba relationship has soured some since then, and according to one analyst, a revival of Yahoo would greatly please its international partners: "A new leader who has that sort of vision would be a person who understands the power of a global footprint and how to make the pieces of an international media company work together." Judging from Yahoo's performance over the last decade, that's easier said than done.

Bring in the Suits: Yahoo Hiring Strategic Advisers to Plot Next Moves [All Things D]
My Picks for Yahoo’s Next CEO — Maybe Snoop Dogg, Ya Digg? [All Things D]
Yahoo’s Future to Dictate Morse’s Tenure [WSJ]
Yahoo looks hard at strategy post-Bartz [FT]
Yahoo Must Keep Bartz’s Strategy of Seeking ‘Most Value’ for Alibaba Stake [Bloomberg]

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Photo: Jed Egan, iStockPhoto