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Yahoo! sets date for Icahn showdown

And Icahn promises to sack founder

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Yahoo! will hold its annual general meeting and shareholder vote on Carl Icahn's proposal to replace the board of directors on 1 August.

Icahn confirmed yesterday that he will sack the company's co-founder Jerry Yang if he wins the vote. He said Yahoo! needed to get rid of Yang and at least part of the board of directors in order to show Microsoft it was serious about any deal.

Icahn's proxy plan always included replacing the entire board of directors, including Yang, but this is the first time the company co-founder has been singled out. Documents released yesterday by the Delaware Chancery court revealed Yang's apparent distaste for any Microsoft takeover.

Icahn will get his chance to win over shareholders at the meeting 1 August. There are two other shareholder proposals - one to replace the entire board and one to replace some directors.

The meeting has been delayed by Yahoo's board of directors. This has been widely interpreted as an attempt to buy more time in order to get some kind of deal in place with Microsoft, or another company. The existing management will badly want something positive to present to shareholders instead of Icahn's blitzkreig.

The make-or-break meeting will be held in San Jose, California. ®

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Latest Comments

Re: Open source it?

Well, MS have zero products under GPL. They hate GP with a fervour that would make a Hezbollah zealot go "steady on, chap!". Do you think they'd take Yahoo's IP if it was licensed under GPL?

No way.

Yahoo would take it, though.

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Anonymous Coward

Poison pill the open source license - problem solved

If the current Yahoo wanted to open source their code so they could use it again in case they want to start over after selling out to Microsoft, they could custom design an open source license with conditions attached. It's their code, they can impose any conditions they like, even totally ridiculous ones like "this code must not be used by any company located on the 13th floor".

Thus, Yahoo could open source their stuff with a viral condition which says the code must only ever be run on a BSD operating system, must never be run on any machine that runs a proprietary web server software, must never be run on any machine that runs a proprietary database server software, or even, that it must never be used by any company that has more than 50% market share in the targeted industry, that it must never be used by any company where more than 5% of the workforce use Windows, must never be used by a company with more than 5% of its computing infrastructure (whether rented, leased or owned) running Windows, etc etc etc. You could even design restrictions for shareholders, like combined voting rights of all shareholders not meeting the conditions are either restricted to a maximum, say 25%, or else the license becomes invalid. If you put a bunch of expensive lawyers in a room to design a watertight system of conditions that won't hurt yourself but your most dangerous competitors, I am sure they will come up with enough legalese to make it next to impossible for those competitors to use the code. Where there's a will there's a way.

In such a scenario, MSFT would still have to purchase the company to get ownership of the code so the licensing restrictions won't apply to them by way of becoming the new proprietors of the code base. Also, if Microsoft did acquire Yahoo with such a license out there, they would then make sure that the restrictions aimed at Google will be enforced. They would even do that if they are only interested in Yahoo's customers and order books and not in the technology.

In fact, I wouldn't even be surprised if Microsoft would still agree to purchase Yahoo if the Yahoo board made it a condition to keep all the technology and half the employees, simply selling Microsoft their customers and contracts.

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Anonymous Coward

Sustained growth == oxymoron

"They have no plan for sustained growth"

There is no such thing as sustained growth. Growth is always temporary. At some point you will hit the wall, the faster you grow, the faster you approach the wall, the sooner you will hit it.

There is nothing wrong with running a business simply for profitability even if it doesn't grow, all it has to do is keep up with inflation. In fact this is far more sustainable than any growth strategy can be. In any event, for as long as a business is profitable, that should be good enough. If you would like to be invested in a business that does grow, buy shares of a company which does, your choice. Don't force your own idea of investments on everybody else, some will be more interested in long term sustainability and they should be allowed to make that choice, just as you should be allowed to make yours.

If everybody starts chasing the quick buck and nobody remains to support long term strategies, that can only hurt all of us. There has to be a balance between short term and long term investments. In fact one might argue that in this day and age we already have too much short term thinking and too little long term thinking. It is that short term thinking which has caused most of the problems we have today, economically, ecologically and politically.

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