Yahoo to spend $100m more for brand buzz

Yahoo believes a lot of its good work has been overlooked by investors and the media, so it's spending more than $100 million to get the word out to consumers directly.

The money is going toward the internet company's most expensive marketing campaign since Stanford University graduate students Jerry Yang and David Filo started Yahoo's website 15 years ago.

Yahoo provided a peek at the 15-month blitz on Tuesday in New York. The ads will run on television, online and other media in the US and nine other countries where Yahoo hopes to expand on a worldwide audience that is already approaching 600 million.

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Microsoft proposes alternative deal to Yahoo

Microsoft Corp said on Sunday it proposed an alternative deal to Yahoo Inc rather than a full acquisition, but the move was unlikely to win favor with financier Carl Icahn, a person familiar with his thinking said.

Icahn launched a proxy campaign on Thursday to replace Yahoo's board with directors who would reopen talks with Microsoft, saying Yahoo had acted irrationally in refusing the giant software company's $47.5 billion bid.

Microsoft walked away from its pursuit of Yahoo two weeks ago after three months of negotiations when Yahoo's board rejected Microsoft's sweetened offer of $33 a share, saying the company was worth at least $37 a share.

The software giant's move on Sunday was likely to prompt the billionaire investor to press Yahoo to further pursue a possible alliance with Google, the source said.

"Microsoft is trying to get the milk without buying the cow, and if you look at Icahn's history, he has never been used that way," said this person. "He does not want to see Yahoo pushed into some joint venture with Microsoft and is not going to be used to push Yahoo into it."

Microsoft's statement on Sunday said it was "considering and has raised with Yahoo an alternative that would involve a transaction with Yahoo but not an acquisition of all of Yahoo." It did not clarify what that alternative might be.

The New York Times reported that Microsoft and Yahoo may form a partnership or joint venture for search-related advertising to take on Google Inc, which dominates the search market with a share significantly larger than a combined Yahoo and Microsoft.

For its part, Yahoo continues to talk with Google Inc about a search advertising partnership and a deal could come as early as this week, a source familiar with the talks said on Thursday.

Microsoft emphasized it was not proposing to make a new bid to buy all of Yahoo, after recently being rebuffed, but could reconsider.

Yahoo replied later on Sunday that it continued to consider a number of strategic alternatives and was "open to pursuing any transaction which is in the best interest of our stockholders."

The company's board will "evaluate each of our alternatives, including any Microsoft proposal, consistent with its fiduciary duties, with a focus on maximizing stockholder value," Yahoo said in a statement.

It added it had confirmed with Microsoft that it was not interested in "pursuing an acquisition of all of Yahoo at this time."

ANALYSTS SPLIT

Analysts were split on the benefits of an alternative scenario to a full-fledged takeover.

"I definitely think an alternative deal is better than a full acquisition," said Toan Tran, analyst at Morningstar. "It is positive for both companies, because you are getting the benefits of a Yahoo acquisition without the negatives, namely the integration risks."

But Kim Caughey, a senior analyst at Fort Pitt Capital Group, said the market will probably send Yahoo shares higher while pushing down Microsoft shares when the market opens on Monday.

Caughey said a joint venture or minority investment with Yahoo could cause confusion about who was in charge.

"Microsoft walking away from Yahoo was a total head fake," said Caughey. "Microsoft is a terrible poker player if it thought people were going to believe that the deal was dead."

Meanwhile, Microsoft and Icahn have not held discussions about Yahoo, said another source close to the company.

In a letter to Icahn last week, Yahoo board Chairman Roy Bostock said a new board would not be in the best interests of Yahoo investors, adding Yahoo would consider any deal from any party, including Microsoft, if it offered the company full value.

Icahn, who has said he had accumulated 59 million shares and options in Yahoo, also has the support of Paulson & Co, a $30 billion hedge fund that has amassed a 3.4 percent stake in Yahoo, and other investors upset by the board's handling of negotiations with Microsoft.

Nokia sees half of cellphones with GPS in 2010-12

Nokia plans to add navigation to half of the phones it sells within a few years to find new revenue streams amid decreasing handset prices, a senior official at the world's top cellphone maker said.

Michael Halbherr, the head of Nokia's location-based activities, told Reuters he remains comfortable with Nokia's year-old goal for seeing up to 50 percent of its phones equipped with global positioning system (GPS) chips in 2010 to 2012.

"We are planning to ship 35 million GPS units this year," Halbherr said, adding "and many more location-enabled phones that use cell-towers to orient themselves on the map".

"You will see few 'E' or 'N' Series phones without GPS," he said.

Last year Nokia sold 437 million phones, and it expects the volume to grow more than 10 percent this year. It sold 38 million phones in its multimedia range "N Series" and some 7 million "E Series" business phones.

GPS chips use orbiting satellites to pin point the where abouts of a phone user, thereby enabling a host of location-based services. SiRF Technology Holdings Inc is the world's largest maker of GPS chips.

Last October, when unveiling an $8.1 billion offer for U.S. based digital map supplier Navteq , Nokia said it would have tens of navigation-enabled phones on the market by end-2008.

It sells five models with built-in GPS and has unveiled four more which will ship in the coming months.

Halbherr said his company's GPS phone strategy goes far beyond the phones themselves.

It's part of a comprehensive strategy to make location-enabled, context-aware phones available across its product line, he said.

Beyond phones specially equipped with location-finding technology, all Nokia phones stand to benefit as GPS phone users move about and effectively update Nokia Maps in real time for other phone users.

"Location will ultimately be in every device," Halbherr declared, not just the half of phones with special GPS chips.

In addition to GPS chips, Nokia's strategy involves pushing Wi-Fi enabled devices that use local wireless network antennas to achieve more or less the same location-awareness in these devices. Even phones without GPS or Wi-Fi can use local cellphone towers to identify their position on maps, he noted.

Nokia Maps, first introduced in early 2006, will come out with a version 2.0 for phones worldwide later this month.

Halbherr mocks the current rush by Internet companies such as Google, Yahoo and Microsoft to deliver all their services as centralized, Web-based services over the network, rather than using the growing powers of the device in users' hands.

"I believe memory and computation speed will grow faster than bandwidth," he said. "I am not a believer in cloud computing."

"All the American navigation solutions are basically server based, which overloads the network and degrades the consumer experience," Halbherr said, referring to both Internet map services and companies specializing in car navigation.

Yahoo partners with Reliance Comm for mobile search

Yahoo! India has extended its tie-up with Reliance Communications to make its mobile search service, oneSearch, available on Reliance mobile phones. Yahoo! Mail and Yahoo! Messenger have been available on Reliance Mobile World, its mobile web portal, for the last two years. The tie-up will enable Reliance Mobile users (both CDMA and GSM) to access news, financial information, weather conditions, flight status information, Flickr photos, Yahoo! Answers and Wikipedia and perform local search on Reliance Mobile World.

Around 10-15 million people access Reliance Mobile World out of a total 38 million Reliance mobile phone subscribers (CDMA and GSM).

Mobile phone subscribers who access Yahoo!’s oneSearch facility will be charged according to the amount of data transfer that takes place.

Yahoo!, which launched the Indian edition of oneSearch in May 2007, has already tied up with Idea Cellular, BPL Mobile and BSNL for the search service. The company uses both search and display advertising on the mobile portal.

Google & Yahoo May Be Looking To Buy Rediff

Google Inc. and Yahoo Inc. are vying to buy Rediff.com India Ltd., the Hindustan Times reported citing an unnamed source.

The paper said the potential takeover could value the Mumbai, India-based news, entertainment, shopping and search site (NASDAQ:REDF) at close to $1 billion.

In addition to Mountain View-based Google (NASDAQ:GOOG) and Sunnyvale-based Yahoo (NASDAQ:YHOO), the paper said Time Warner Inc.'s (NYSE:TWX) America On Line unit may be a suitor.

Besides the Web site, Rediff.Com India limited publishes two weekly newspapers aimed at Indian-Americans, India Abroad and India in New York.