Download the Yahoo! Messenger 10 Beta for Windows

Yahoo! has finally decided to launch the Yahoo! Messenger 10 IM client in beta for Windows. As claimed, this new release will add more to the features of the world's most favorite IM client for PC users.

 The most noticeable new improvements have been made to the webcam feature which now allows the user to make high-quality video calls. Features include the ability to swap video windows, position the video windows side-by-side, mute the call or place it on hold.

Other new features include:

• New "Y! Updates" view of your contact list.
• All-new Yahoo! Insider.
• Choose your language easily.
• New ways to sort your contacts.
• New icons in the IM window.

Can't wait to try out the new Yahoo! Messenger 10 beta already? Download it for Windows.

Yahoo!'s Dangerous Newspaper Deal?

Desperate for digital revenue, newspapers are sharing their advertisers with Yahoo!.

As newspapers around the country struggle to develop strategies for growing revenues online, more and more of them are turning to an unlikely ally for salvation: Yahoo!.

Last week, five struggling newspapers including the San Diego Union-Tribune and the Orange County Register joined the Yahoo! Newspaper Consortium, an online advertising partnership between the Web publisher and the print publishers. The group, launched in 2006, now counts 814 papers as members, or 51% of the entire U.S. newspaper market as measured by Sunday circulation.

At first glance, linking up with Yahoo! ( YHOO - news - people ) seems a no-brainer. By joining the consortium, the papers will be able to supplement the advertising they sell to local clients--mostly display ads in the papers and on their Web sites--with expensive ads targeted by geography and user behavior on Yahoo!'s collection of heavily-trafficked Web sites.

In exchange for access to Yahoo!'s ad inventory, papers turn over half of the revenue from ads they sell on the portal. Since joining the consortium, the Atlanta Journal-Constitution expanded its local reach, the proportion of the regional population who hit its Web site in a month, from 15% to 85%, Yahoo! says. The Evansville Courier Press, an Indiana daily with a circulation of 60,000, sold $1.1 million in Yahoo! ads in a week-long "sales blitz." Yahoo! won't discuss the specifics of the revenue-sharing agreement, but newspaper partners confirmed the 50-50 arrangement.

But the partnership could have an even bigger cost for newspapers. In the offline world, newspapers have traditionally dominated advertising sales to local businesses like retailers, car dealerships and supermarkets. By introducing their local advertisers to Yahoo!, newspapers run the risk of turning over their best customers to a digital powerhouse as they try to rebuild their own businesses online. (story Link)

T-Mobile G1 Slam Dunks Software, Airballs Hardware

Between the Youtube videos, fan sites, and ever-cranking rumormills, it’s like we knew all about the first phone running Google's Android OS before we ever got our mitts on one: a boatload of apps available through the Market, built-in Amazon music store, 3G, Wi-Fi, Google Maps with Street View, that crazy shape-driven lock code, and so on. Sure enough, all those message board stars are present and accounted for on the G1, but don’t worry: There are still plenty of surprises to keep you entertained.

Surprise #1: Android is pretty freaking on-point for a first-gen software release. Sure, it has bugs—Web pages don’t automatically re-size and the zoom feature blows—but it’s also remarkably polished, bristling with nifty tricks. Take the long touch: Not unlike the windows-born right-click, it brings up useful contextual menus. Long touch a field of text, for example, and you get the option to select it, copy it, or paste something in (take that, Jobs!). And though Android’s first home is a touchscreen phone, you can tell that the OS was designed to work with hard-buttons as well.

In fact, if you can’t abide fingerprints, you can get around the G1 quite well without ever smearing the glass. There’s a BlackBerry Pearl-esque trackball in the center of the button bank that lets you cruise menus, websites, or any other screen you can bring up. Five other buttons flank the trackball: the ubiquitous green and red phones, “back,” “home,” and “menu.” The keys are useful, but their physical location is a problem that ties into the most noticeable G1 bugaboo: its size. This is a big bitch for us—nearly a half-inch thick—and its problematic girth is made worse by an annoyingly curved-up section that makes the phone frustrating to pocket: that button bank. If you want to rock a G1, be prepared to bust out the manpurse or multi-pocketed raver jeans (sorry, Hipsters).

The phone’s main interface is a 3.2-inch touchscreen that swivels out of the way along an arced path to reveal a QWERTY keyboard. The keyboard is fine, but that frakking curved button bank (which also houses the mechanics of the arced hinge) makes typing uncomfortable. Also, since the screen swings to the right, non-lefties will have to reach across the phone to flip it open with their thumbs—and no amount of soft-touch plastic is going to keep them from dropping the G1 from time to time.

The capacitive touchscreen is fine—neither the best nor the worst we’ve seen in terms of appearance or sensitivity. G-Mobile uses a half-assed haptic feedback mechanism (the phone vibrates) to confirm touches, but you can (and should) turn it off.  —Joe Brown

WIRED Android is legit, and future iterations should get even more impressive. 3G on a T-Mobile phone. Tons of apps that will keep you entertained for the duration of your 2-year contract—and all of them are free until Google decides on a way to charge. Relatively cheap, and data plans include T-Mobile hotspot subscriptions. Snappy processor never seems to get bogged down, even with multiple apps running. Decent battery life: a day of heavy use or three if you have no friends. Mounts on both Mac and PC as an external drive, allowing you to drag-and-drop music or videos.

TIRED Fugly. Bulky. No 3.5mm headphone jack and no adapter that lets you plug your own buds into the HTC mini USB multi-port. T-Mobile’s 3G network not as quick as AT&T’s, and nowhere near as pervasive. We don’t mean to whine about free stuff, but the included 1GB MicroSD card seems a little dinky compared to the 8-gig iPhone you can get for $20 more. Camera is slower than a three-toed sloth to respond.

$180 with 2-year contract, t-mobile.com (story Link)

Microsoft Testing New Internet Search Service

Microsoft Corp is internally testing a new version of its online search service under the name of Kumo.com, a spokesman for the software company said on Monday.
The service is not yet available outside the company, but may eventually form part of Microsoft’s attempt to catch up with Internet search leaders Google Inc and Yahoo Inc.
The new search service was unveiled in an internal memo sent by the head of research at the company’s online services division on Monday, but it did not go into details about features on the new service. (chipbit)

Opera 10 Alpha

Today Opera Software made available a preview of its next major browser version, Opera 10. The pre-release alpha version showcases a new rendering engine, Presto 2.2, which the company states will improve browsing performance over the previous version by 30 percent. The company also claims that the reengineered browser and rendering engine will lead in standards support, saying that it manages 100 out of 100 on the Web Standards Project's Acid3 browser test. The previous best among major browsers was Google's Chrome, scoring 79 out of 100. In my testing, I confirmed the rare 100 score, as you can see from the accompanying slideshow.

The very lightweight installer is a mere 6MB download. Firefox is just a bit bigger, at 7.2MB. Internet Explorer 7 dwarfs both, at 14MB. Installation itself is straightforward and quick. When you launch the browser, it loads in less than 2 seconds. On the same machine, Firefox 3 and Google Chrome take slightly over 2 seconds. But startup speed for all of the browsers is good on a reasonably up-to-date machine.

For speed, Opera 10 won't set any records, but it's fast—and it's still an alpha. Chrome's performance on the Sunspider JavaScript benchmark, however, vastly exceeded what the new Opera engine managed. The test runs a balanced variety of JavaScript operations—such as string manipulation, graphics operations, and decompressions—multiple times. Opera took 8,088ms (a lower score is better), far faster than Internet Explorer 7's 256,116, and slightly lower than Firefox 3's 6,535, but still substantially trailing Chrome's 2,763 on the same Vista machine.

Of course, according to Microsoft, JavaScript performance accounts for just a small fraction—under 4 percent—of actual Web-page loading time. And anecdotally, a PCMag.com page that took 4 seconds to load in Chrome took only 2 in Opera 10. But in a test called Lots of Text, which evaluates a different aspect of performance, Opera took only 92ms compared with IE's 128ms. Chrome blew both of them away, clocking a mere 12ms Firefox posted a respectable 64ms. I should note, though, that the developers may not have optimized Opera's memory usage yet in this alpha build. I loaded the same ten popular media-rich sites into Opera 10 and Firefox, and Opera required 156MB of RAM, and FireFox only 111.

In real Web site testing, the Opera 10 alpha works well with Facebook, though it didn't seem any faster than Firefox, despite the Opera team's claims. And Yahoo mail (in its newest form) still presents an error page stating that the browser isn't supported. Opera had no trouble with Citibank's site, but the Fidelity Investments financial site claimed that the browser didn't support 128-bit encryption, and it wouldn't display in my account.

The new version keeps all of the former's helpful and unique browsing helpers, such as tab previews, mouse gestures, and its trademark speed-dial page. With speed-dial, whenever you create a new tab, it opens and shows nine favorite sites of your choice, any of which you can visit with a single click. Of course, you still get a predictive address bar, much like what you'll find in Firefox, Chrome, and Internet Explorer 8. And Opera still boasts one of the best implementations of tabs in any browser. The "new tab" button is the clearest of that in any browser, and you can drag tabs out to a new window or to the trash can. This version adds spellchecking and a streamlined feature for updating the browser. (story Link)

Major CE Makers Pledge to Support Yahoo Widgets

Samsung, LG, Sony and Vizio have all pledged to support the Yahoo Widget Channel technology originally launched last September. But only Toshiba will be using Intel's media processor inside its TVs.

Las Vegas (Reuters) - Yahoo Inc unveiled on Wednesday a list of partners to aid its push to bring the Internet and television together, hoping their joint effort will finally connect with consumers.

At the Consumer Electronics Show in Las Vegas, Yahoo said it has forged deals with companies including Samsung Electronics Co Ltd, LG Electronics Inc, Sony Corp and Vizio, which will make high-definition TVs that support Yahoo's online service.

Ever since the dawn of the Internet Age, tech companies have been promising to bring "convergence" of the online and TV universes, but those efforts have failed to take off with consumers who have found such products difficult to use.

The new TVs announced on Wednesday will be in the market as early as the spring and will support widgets—small Internet applications—that run alongside broadcast TV content, but not over it.

The applications can be used for a wide array of Web activities, like watching videos on Google Inc's YouTube.com, social networking on News Corp's MySpace.com, tracking stocks and sports teams, buying and selling on eBay, messaging friends using Twitter, or using Yahoo's own photo-sharing website Flickr.

The widgets will allow viewers more interaction with the programs they're watching, Yahoo said. There will also be applications based on Yahoo-branded services such as Yahoo Finance.

Yahoo, which has lagged behind larger rival Google in the Web search market, will use the technology as a new avenue to sell advertising.

In an interview ahead of CES, Patrick Barry, vice president of connected TV at Yahoo, said TV "is still top of mind for advertisers," the place where people spend the most time. (full Story)

Report: Microsoft in stealth Yahoo takeover?

Techcrunch, quoting anonymous sources, is reporting that a group of Silicon Valley executives and investment bankers are proposing a takeover of Yahoo - with the help of financing from Microsoft.

The proposal calls for a premium of about 20 percent over Yahoo’s current share price, which closed at $12.71 Tuesday, down 2 percent. Shares continued to slide in after-hours trading. The Silicon Valley group would immediately sell Yahoo’s search and marketing businesses to Microsoft and take over the top ranks of Yahoo, leaving the company as an independent, the site reported.

It’s important to note that this is simply a proposal to Microsoft at this point and that it needs backing from Redmond to fly. (story Link)

Microsoft, Yahoo, Google: Failing To Forget

Computers can be great at remembering things. Sometimes too great. The major search engine providers are competing to remember your search terms for the shortest possible period. Or at least that's what they are saying publicly. There seem to be loopholes in this competition for the shortest data retention, and in some cases I'm actually glad for that.

The latest development came when Yahoo reduced its personal data retention to 6 months, down from 13 months. Google (NSDQ: GOOG) currently keeps the data for 9 months, and Microsoft (NSDQ: MSFT) still keeps your personally identifiable information for 18 months. There are definitely cases where the search engines can keep your data for much longer, though.

I don't mind a search engine keeping data about my searches as long as I can see the data and have some control over how long it's kept. It's useful to be able to see the results of past searches, particularly when you're trying to find something that you know you saw before but aren't able to find. I just checked my Google account and it has search results saved all the way back to October 2006. During that time, Google says I've made 10,552 searches. (Wow.)

On this very day in 2007, for example, I used Google to make several searches to determine how to repair a damaged Windows Management Instrumentation (WMI) setup. I've had to go back to those pages several times, and when I search for WMI in Google it shows me the date and time that I visited those pages in the past.

If some of those 10,552 searches are so embarrassing that I wouldn't want to risk anyone seeing them, Google gives me the ability to selectively delete a search. I can even remove the entire search history so that it can't be retrieved. There is no way that I would do that, though; this information is too valuable. Even though Microsoft keeps search data for the longest period of time, I couldn't find any way to view my search history with Live Search. (full Story)

Why Microsoft Really Wants Yahoo’s Search

We normally hear from people that the only reason Microsoft wants to buy Yahoo! is because of Yahoo’s search technology and its user base, True but that is not the whole story and the rabbit hole goes little more deeper than that. Microsoft pretty much dominates two of the most important platform’s Operating System and Browser, and we know “Platforms almost always win against the Applications built on it”. So Microsoft will sooner or later get traffic to its web services because of its platform dominance, the problem is how to monetize that traffic, that is where Yahoo and its 361 Patent comes into picture.

361 Patent was the brainchild of Bill Gross, founder of IdeaLab who had this great idea of monetizing search results by showing the users advertising based on the keywords they type, he though of it as an Yellow Pages on the Internet where users could search what they want and they were ads too. This idea was shamelessly stolen by Google who before this made zero revenue. Bill Gross who later found Overture Services (formerly GoTo Inc), which was bought by Yahoo and in turn Yahoo had the right’s to this crown jewel “361 Patent”.

Once Yahoo got the rights to ‘361 Patent’, it started enforcing other companies who were licensing it from Overture Services to follow its rules. One of the biggest licensers from Overture was Microsoft who were paying hefty fees for it. Now Yahoo started making life hell for MSFT when it came to Paid-Search advertising. This made Microsoft less innovative in search because no matter how good their search was, they always had to toe the Yahoo’s line when it came to monetizing the search and paying most of the money to Yahoo for using the “361 Patent”. It just didn’t seem practical for Microsoft to innovate when they can’t make money of their search or pay most of the money to Yahoo.

Whereas Google got the patent licensed in a very shady deal where nobody clearly knows how much they paid and it gave them an edge in Paid-Search advertising. The reason they got a good deal from Yahoo might be because of their Stanford roots or because of common VC’s. It was a clear conspiracy by Yahoo to make the battlefield uneven and making Microsoft insignificant in Paid-Search model. It is a payback time for Microsoft and boy are they doing it at the right time. Microsoft is known to come late to war and be the last one standing, will they do it again.

You can read more about 361 Patent and its repercussions in Usman Latif’s website here. He has written a detailed and well written article on this. (Link)

2008 Year in Tech: Winners and Losers

What a year. We experienced a presidential election unlike any other—one in which technology and the Internet truly played a starring role. That contest produced a winner and a loser. Similarly, the myriad tech sagas we witnessed throughout 2008 produced a long list of victors and failures—at least as I see it. Let's reminisce.

HD Format Wars
The year began auspiciously with the surprising and sudden end of the HD format wars. No one surrendered. Instead, HD DVD partner Warner Bros. dropped its support of HD DVD. That set off a cascade of bad news for the format backed, most notably, by Toshiba. By the end of January, Gartner was calling a technical knockout for Sony-backed Blu-ray. Twelve months later, all that's left of HD DVD are some players owned by early adopters and thousands of orphaned HD DVD disks.
Winners: Sony and everyone who backed Blu-ray
Losers: HD DVD and me

Linux-based Palm OS
Sascha Segan teased us with news of a new, Linux-based Palm OS, which, naturally, still hasn't arrived.
Winners: All Palm competitors
Losers: Palm and anyone still married to the Palm platform

MacBook Air Hype
Apple introduced the MacBook Air, "The World's Thinnest Notebook". Initially, it turned a lot of people on—until they realized it has only one USB port and a fixed battery.
Winners: Apple
Losers: Anyone who bought into the MacBook Air hype

Microsoft and Yahoo Merger
The merger dance between Microsoft and Yahoo began anew in February as pundits, including John C. Dvorak, predicted mostly disaster if the two became one. (I admit it: I waffled.) The Redmond software giant offered Yahoo a 62 percent premium on shares ($44.6 billion), which Yahoo CEO Jerry Yang rejected. Corporate raider Carl Icahn tried to force the MS takeover, but to no avail. Fast-forward eight or nine months, and Yahoo's shares are worth roughly half of what they were in February. The company is laying off employees in bunches.

Yang has promised to step down, and Microsoft swears it has no interest in acquiring Yahoo. I still wonder if Microsoft's aim all along was to hobble a strong Internet competitor. Nah, that would be too Machiavellian.
Winners: Microsoft, Google
Losers: Yahoo, its shareholders, and Jerry Yang

Microsoft Acquires Danger
Microsoft gobbled up Sidekick manufacturer Danger, but my hoped-for "ZunePhone" never materialized.
Winners: None
Losers: None

Google's Android Platform
Google Android reared its open-source mobile platform head at the Mobile World Congress in Barcelona, Spain. Of course, the press went mad for it, since it's from Google (yeah, we did, too). Eight months later, again amid much fanfare, the first Android Phone arrived, the T-Mobile G1. The press went mad for it again. For me it was, like, "Meh."

Winners: Google, T-Mobile
Losers: Microsoft, a company that simply cannot build any buzz for Windows Mobile-based phones
(More Winners & Losers)

What Gmail Does Better Than its Competitors

As someone who spends an inordinate amount of time wading through e-mails, finding the best e-mail service is paramount in my life.

Realizing that, I've done my fair share of shuffling from one e-mail program to the next--trying to find the best service that not only offers speed and stability, but also reliability and spam control. And although e-mail services are getting better, it's abundantly clear that few offer the kind of experience I'm really looking for in an e-mail client. But Google's Gmail app is different. It's better than its competition on a number of levels and provides the kind of e-mail experience that's simply unrivaled online.

Spam, Spam, Spam

I've used practically every e-mail service on the Web and I can say, without a doubt, that Gmail blocks the most spam. To those who open a new account, spam may not be a serious concern. Your spam folder will likely remain empty for a while until your new e-mail address makes its way into the wild. But for my e-mail address, which is widely available and easily attainable, spam is a constant headache. On services like Yahoo Mail, Windows Live Hotmail, and AOL Mail, the spam blocker tried but failed on too many occasions. In fact, dealing with spam in my already bloated in-box was a daily occurrence that got worse as more messages piled up. But Gmail is different. Right now, I have thousands of messages sitting in my spam folder that never made their way to my in-box. Even better, I can say with all honesty that I only see about two or three spam messages per day in my in-box--not perfect, but much better than anything the competition is offering.

Google Apps

Maybe it's not fair to compare e-mail clients on the basis of additional apps, but I'll do it anyway. After all, Google is competing with the likes of Yahoo and AOL--two major Web companies--and I don't see why these two can't release apps that provide an even greater value proposition to users. There's something so appealing about receiving an e-mail from someone who attached a Word document or Excel spreadsheet and being given the option to open that attachment in Google Docs. And being able to switch to Google Calendar and Reader from Gmail cuts down on time spent on managing my day. Maybe that functionality appeals to me because I prefer using apps like Google Calendar and Reader to keep me organized and "in the know", but I honestly can't see myself using another e-mail client knowing how invested I am in other Google apps. Suffice to say that my affinity for Gmail stretches beyond e-mail.

Filters

Gmail's filter feature is the best in the business. Period. Unlike its competitors, which try to provide a filter tool that simply re-routes incoming messages, Gmail delivers a power user's dream. In a matter of seconds, you can create a filter that searches through all incoming mail looking for specific people or keywords and once found, immediately categorizes it into a specific folder, forwards it on to someone else, or moves it to the trash, to name just a few functions. With the help of Filters, using Gmail becomes an even more rewarding experience. Gone are the days of spending big chunks of your time attempting to find just one e-mail that's lost in a collection of thousands. Other e-mail services try desperately to provide the same kind of filter features, but they fall flat. In my experience, messages are either missed, the filter has performs the wrong function, or simply not ends up not working. In fact, Yahoo Mail's filter feature works only in its Classic e-mail app and according to the company, won't be available in the new interface until it's done "tweaking the Yahoo! Mail Filters option." Yikes. (full Story)

Microsoft, Yahoo Media Talks Still Ongoing

SAN FRANCISCO/NEW YORK (Reuters) - Microsoft Corp and Yahoo Inc have been holding separate talks with other potential media partners after their negotiations with each other broke down, sources familiar with the companies' thinking said on Wednesday.

Microsoft—rebuffed this year in efforts to buy all of Yahoo and then just its search business—is talking about alternative deals with Time Warner Inc, which owns AOL, and News Corp, parent of MySpace, a source close to Microsoft said, but any negotiations remain in preliminary stages.

Meanwhile, talks have continued for months between Yahoo and Time Warner over a potential merger of AOL with Yahoo to create a more formidable advertising and media player, but they are no closer to a deal, a source close to the matter said.

Shares of Yahoo jumped as much as 9 percent on Wednesday after the Wall Street Journal reported that Microsoft, positioning for a new run for Yahoo's search business, had in recent days approached media companies to join together on a deal that would effectively lead to Yahoo's breakup.

However, a Reuters source and a CNBC report, citing unnamed sources, later said there were no new talks or negotiations.

The Journal also said Microsoft met with activist investor Carl Icahn in recent days to encourage him to press his proxy battle for control of Yahoo's board, the first sign Microsoft welcomed his month-old campaign. This development also was attributed to unnamed sources familiar with the talks.

Icahn was not available to comment on the report.

Microsoft, Yahoo, Time Warner and News Corp all declined comment.

REVIVING HOPE

Wall Street analysts said the latest news revived flagging hopes among some investors that Microsoft was still interested in doing a deal with Yahoo. "The hopes that Microsoft would come back were getting crushed over the last 10 trading days," Collins Stewart analyst Sandeep Aggarwal said.

Yahoo stock ended the day up 3.4 percent at $20.88. The stock had traded as low as $19.58 on Tuesday, near its level in late January before Microsoft made its unsolicited takeover bid for Yahoo, sending the stock above $30 by mid-February.

Microsoft shares fell 3.7 percent to $25.88 on Wednesday. In the prior day's trading, Microsoft fell to two-year lows of $23.19, intraday, before recovering.

Analyst Youssef Squali of Jefferies & Co said the sharp Yahoo stock reaction was most likely a defensive move by short-sellers seeking to cover bets a Microsoft deal was off.

"Even the rumor that Microsoft is getting interested again is enough to have people to want to cover their bets against Yahoo stock," Squali said, adding that many investors have shorted Yahoo from the high $20s all the way down below $20.

Adding to the volatility were options investors who placed fresh bets Yahoo would be trading up to $27.50 by October, said analyst Rebecca Engmann Darst of Interactive Brokers Group.

THE WAITING GAME

Several financial analysts said a key detail in the Journal report was that Microsoft and Yahoo executives had sought to revisit the merger on May 17—two weeks after Microsoft walked away—and that two Yahoo board members in the meeting had said they would settle for a merger worth $33-$34 a share.

On May 3, Yahoo rejected a $33-a-share Microsoft offer worth $47.5 billion, and earlier this week questioned whether the software maker was ever serious about a full-scale merger.

The source familiar with Microsoft's thinking confirmed that Yahoo had belatedly sought a deal in mid-May worth $33 to $34, but that Microsoft was no longer interested at that point.

The source said Microsoft executives considered the early May deadline as vital to winning regulatory approval before the end of the year—when a new presidential administration arrives and months more delays would likely occur.

Microsoft also become convinced that Yahoo executives were passively resisting the deal and unwilling to seriously negotiate. Meanwhile, the economy has taken a toll on the online ad market, and with it, the value of buying Yahoo.

"Microsoft is going to let Icahn do the dirty work and hand Yahoo over to them," Jefferies & Co's Squali said, adding that it was in Microsoft's interest to hang back and let Yahoo shares settle lower as investors quit betting on a takeover premium.

In the long run, however, Microsoft needs Yahoo more than Yahoo needs Microsoft, he argued.

"Microsoft has a gaping hole in its strategy and it's called the Internet and it's only getting worse because Google is encroaching on Microsoft's business," Squali said.

Separately, the U.S. Justice Department is pursuing a formal antitrust investigation into a deal reached last month between Yahoo and Microsoft-archrival Google Inc to team up on Web search advertising.

Google, with more than 60 percent of the Web search market, and Yahoo, with 16.6 percent, agreed to a deal for Google to run search ads on Yahoo's site in a partnership that could mean $250 million to $450 million in new cash flow for Yahoo.

Google said it was confident the deal would enhance overall industry competition, but declined to discuss the probe.

(Additional reporting by Ajay Kamalakaran in Bangalore, Franklin Paul in New York, Diane Bartz in Washington, D.C., Doris Frankel in Chicago; Editing by Derek Caney, Leslie Gevirtz, Gary Hill)

Yahoo to Offer Ad-Supported Free Game Downloads

NEW YORK - Yahoo Inc said on Thursday it would offer its users hundreds of popular casual online games as free downloads backed by revenue from advertising integrated into the games.

More than 400 ad-supported games from top casual games publishers like Anarchy Big Fish Games and Sugar Games will be available to users before year-end, Yahoo said.

The company is working with technology providers Double Fusion and NeoEdge to sell and integrate video ads into the Yahoo! Games catalog.

Casual online games are usually games developed for mass consumers. They rarely require much expertise or time to play.

Some of the most popular casual games include Solitaire, Tetris and Bejeweled, and many players of such games are women between the ages of 35 and 54.

Yahoo said in-game advertising will allow it and its publisher partners to drive revenue by providing advertisers access to a coveted demographic of gamers.

Yahoo Bigwigs Move to Defend Microsoft Rejection

NEW YORK - Yahoo began pressing a case to major shareholders that its board and management deserve a chance to prove they made the right move when they rejected a $47.5 billion takeover offer from Microsoft.
The missed opportunity to sell to Microsoft infuriated many Yahoo shareholders, prompting activist investor Carl Icahn to agitate for replacing Yahoo's nine directors and reviving negotiations with Microsoft. If he gains control of the board, Icahn intends to fire Yahoo co-founder Jerry Yang as chief executive.
In response, Yahoo has assembled a 32-page shareholder presentation to elaborate on the points it has been emphasising since Microsoft withdrew its bid May 3.
Investors will decide the dustup in a vote scheduled Aug. 1 at Yahoo's annual meeting. That leaves another month for the Sunnyvale, California-based company and Icahn to disparage each other.
And with Yahoo shares sliding back toward $19.18 - their value before Microsoft's bid - Yahoo's management is facing even more pressure to end the financial malaise that triggered the takeover bid in the first place. Yahoo shares fell 44 cents to $20.89 in yesterday afternoon's trading.

Icahn didn't respond to a request for coment, but he wrote on his blog last week that he would share his latest opinions on Yahoo "shortly."
Yahoo argues that entrusting the company's fate to Icahn would be foolhardy because his strategy centres on resurrecting a dead deal.
Its breaking point came after Yang and Microsoft CEO Steve Ballmer couldn't agree on a price. Ballmer had orally offered $33 per share, but Yang wanted $37 per share - a price that Yahoo's stock hasn't reached in nearly 2 years.
Since Microsoft walked away, Yahoo said it tried to reopen sales negotiations in meetings on May 17 and June 8, only to be told "unequivocally" that the software maker no longer is interested in buying Yahoo in its entirety.
Hoping to dispel any perception that it mishandled the Microsoft negotiations, Yahoo's shareholder presentation lists the dates of at least eight meetings that its management or other representatives held with Microsoft before the bid was withdrawn.
Yahoo also wants to raise doubts about the sincerity of Microsoft's bid, arguing that its unsolicited suitor was "unresponsive and inconsistent" during the first three months of negotiations.
"The record casts doubt on whether Microsoft was ever committed to a whole company acquisition," Yahoo asserted in the shareholder presentation.
But Ballmer appeared to leave little doubt he prized Yahoo's whole franchise when he submitted his initial bid of $44.6 billion, or $31 per share. The Jan. 31 offer was 62 per cent above Yahoo's stock price at the time. Microsoft made its oral offer of $47.5 billion May 2.
"This is simply revisionist history," Microsoft spokesman Frank Shaw said about Yahoo's account of events.
To move on from the Microsoft bid, Yahoo hopes for a major boost from a planned advertising partnership with internet search leader Google Inc.
By relying on Google's superior technology to show some of the ads alongside its search results, Yahoo believes it can increase its annual revenue by about $800 million and generate another $250 million to $450 million in annual cash flow.
Although the Google partnership still could be blocked by antitrust regulators, Yahoo believes it offers more value than an alternative deal proposed by Microsoft. The software maker offered $9 billion for Yahoo's online search operations and a roughly 16 per cent in stake in the rest of Yahoo's business.
In its shareholder presentation, Yahoo argues Microsoft's partial offer is a "bad choice" because it wouldn't be as lucrative or as flexible as the Google partnership