YAHOO!’S NEW DIRECTIONS

Yahoo! CEO Terry Semel had a lot to celebrate this new year and he appears to be happy to talk about it. On Monday, at the Smith Barney Citigroup Entertainment, Media and Telecommunications Conference in Phoenix, Semel spoke of the new directions he anticipates Yahoo! taking in 2004. The biggest change for Yahoo! will be a switch in where search results are drawn from. Currently, Yahoo! receives results from Google. Sometime this year Yahoo! will (99% likely) begin drawing results from their in house search database, Inktomi. Semel also noted Yahoo!’s rapid growth over the past two years with the introduction of paid services such as Yahoo! shopping sites and music distribution. Yahoo! now boasts over 5Million paying users, up from zero two years ago. A large portion of these paying users come from the partnership between Yahoo! and SBC Communications to bundle Yahoo content into SBC’s DSL subscriptions. Yahoo! is currently the front runner in the search engine business war and has been brilliantly placed to take advantage of the emerging trends of contextual advertising and the rapid growth of e-commerce.