SAN FRANCISCO (AP) — Yahoo has starred in a decade-long soap opera during which it’s run through five CEOs, fended off a hostile takeover bid from Microsoft and sparred (often unsuccessfully) with activist investors who muscled their way on to the Internet company’s board.
Expect more drama next year. Yahoo CEO Marissa Mayer wants to buy more time for the turnaround she promised after the Sunnyvale, California, company lured her away from Google three-and-half years ago.
Here’s what Yahoo’s next chapter could look like based on what we know now:
THE CONQUERING HEROINE
This is, of course, the story line that Mayer, 40, has envisioned all along. She has pledged that Yahoo’s revenue will eventually increase at the same clip as overall digital advertising revenue, something that the company hasn’t come close to doing yet.
It still might happen if Mayer’s big bets on mobile applications and online video pay off and Yahoo gets the all-clear from the feds to use Google’s search technology to attract more traffic and sell more advertising. Mayer also has indicated that Yahoo is working on products that could draw people to use its services more frequently. Some unsubstantiated reports suggest that Yahoo plans to unveil a digital assistant to compete against Apple’s Siri, Google Now and Microsoft’s Cortana.
THE BIG PURGE
Many investors believe Yahoo remains bloated, given that its net revenue has fallen from $5.4 billion in 2008 to a projected $4 billion this year.
In an apparent attempt to placate Wall Street, Mayer plans to jettison an unspecified number of services that have either been losing money or are barely money. Depending on how deep she cuts, hundreds of Yahoo workers could lose their jobs. Yahoo ended September with 11,500 employees and contractors, down 32 percent from when Mayer was hired in July 2012.
Yahoo is planning to spin off its $30 billion stake in Chinese e-commerce bazaar Alibaba Group into a separate company called Aabaco either next month or in January. The maneuver is designed to dodge a huge tax bill Yahoo would face if it sold the Alibaba stock itself, but it might not work. The IRS has refused to clear the plan in advance for a tax exemption.
Based on preliminary feedback from tax lawyers, Yahoo believes the spin-off will quality for tax-free status. That opinion still doesn’t guarantee that Yahoo won’t be saddled with a tax bill of more than $10 billion. The tax uncertainty hanging over the Alibaba spin-off is among the reasons that Yahoo’s stock has fallen 35 percent so far this year.
SELL OR ELSE
Activist investor Starboard Value is so worried about the tax problem that it wants Mayer to scrap that idea and sell Yahoo’s Internet business — that is, everything that most people associate with the Yahoo brand — instead.
If Mayer doesn’t back down, Starboard is threatening to gather enough shareholder votes to toss out Yahoo’s board of directors, which includes Mayer. It probably couldn’t stage that mutiny until the summer, if then.
Yahoo has faced two other shareholder rebellions since 2008, one by led by Carl Icahn and the other led by Daniel Loeb. Both Icahn and Loeb wound up with seats on the company’s board. Neither investor remains a director now.
Under the Starboard plan, Yahoo might end up as nothing but a holding company that owns stakes in Alibaba and Yahoo Japan. Yahoo Mail, its websites and other services still used by hundreds of millions of people would belong to a new owner — assuming anyone wants them.
THROWING IN THE TOWEL
Some investors want Yahoo’s board to replace Mayer. The directors have given no indication that they have lost faith in Mayer and she seems intent on finishing the job she started.
Mayer, 40, is about to take on another challenge at home; she is due to give birth to twin girls in December. If things continue to deteriorate at Yahoo and more shareholders clamor for a new CEO, it doesn’t take much imagination to envision Mayer deciding to step down to spend more time with her children at some point next year.
Follow AP Technology Writer Michael Liedtke at https://twitter.com/liedtkesfc . Read his work at http://bigstory.ap.org/content/michael-liedtke
WEST POINT, N.Y. (AP) — Cadet pillow fights like the bloody one that left 30 injured this summer will be banned and actions are being pursued against many of those involved, U.S. Military Academy officials said Wednesday.
First-year students, known as “plebes,” organize the annual pillow fight as a way to build camaraderie after a grueling summer of training. But the pillow fight on Aug. 20 escalated into a free-for-all with plebes being hit from behind and knocked to the ground. Injuries included a broken nose, a fractured cheek and 24 diagnosed concussions, according to a report on the pillow fight released Wednesday.
“While never officially sanctioned, it is now officially banned, and we will take appropriate action to ensure that all faculty, staff, leaders, the Corps of Cadets and everyone at West Point knows that it will not be tolerated,” West Point Superintendent Lt. Gen. Robert Caslen said in a statement.
There were reports that some cadets were injured by hard objects placed in pillow cases after photos and video of the melee circulated on social media. But the report said many injuries were caused instead by elbows and falls to the ground. One cadet was identified by military police as striking another cadet with a hard object in a pillow case. One cadet was found unconscious.
The report said upper-class cadets did not take proper control of the fight to ensure the safety of pebes. Caslen said the incident could have been prevented with better communication between cadet leadership and senior military personnel before the pillow fight.
“I’m troubled by the failure to mitigate and lead, and by the conduct of those whose actions contributed to this incident,” Caslen said. “I am taking appropriate action based on these findings — to include administrative actions against senior military members and cadets alike — to send a clear message that this kind of behavior will not be tolerated at our nation’s premiere military academy.”
HARWICK, Pa. (AP) — A western Pennsylvania woman has been ordered to pay $600 for hurling driveway gravel at her next-door neighbor’s drone.
Mark Shock says he was finishing up a flight in Harwick on Aug. 30 when Martina Wlodarski hurled a stone and hit the remote-controlled aircraft.
A video shows the drone going haywire after being hit. Shock says two blades flew off and nearly hit him in the face.
Wlodarski says she was frightened by the 3.5-pound aircraft and acted in self-defense.
Criminal mischief charges were dropped on Monday as the neighbors agreed that Wlodarski would pay Shock restitution.
CANBERRA, Australia (AP) — A third ship will join the deep sea hunt for a missing Malaysian airliner as the 13-month-old search of a huge expanse of the Indian Ocean ramps up during the southern hemisphere summer, officials said Wednesday.
The search for Malaysia Airlines Flight 370 was scaled back to two ships towing sonar equipment during the winter when the remote target area more than 1,800 kilometers (1,100 miles) southwest of Australia was buffeted by gale-force winds and mountainous waves.
The search has covered more than 70,000 square kilometers (27,000 square miles) since it began in October last year based on analysis of scant satellite information that tracked Flight 370’s final flight on March 8 last year.
Authorities are unable to explain why the Boeing 777 went far off course with 239 people aboard during a flight from Kuala Lumpur, Malaysia, to Beijing.
A third ship Havila Harmony, equipped with a video camera inside an underwater drone, will leave the Australian port of Fremantle on Saturday and reach the remote search area five days later, the Australian Transport Safety Bureau said in a statement.
The bureau, which conducts the search on behalf of Malaysia, said the Havila Harmony would investigate rugged seabed terrain which cannot be effectively searched with less maneuverable towed side-scan sonar.
One of the two ships that made slow progress throughout the winter, the Fugro Discovery, began the 2,800-kilometer (1,700-mile), six-day voyage back to Fremantle on Saturday because a crew member had become sick, the bureau said. The bureau gave no details of the crew member’s condition.
The same ship returned to Fremantle earlier in November after only a day of searching because of a crew member’s suspected appendicitis. The Fugro Discovery had managed only six days of searching the 120,000-square-kilometer (46,000-square-mile) priority area before it was forced back again for medical help. All ships have a doctor on board.
The ships are resupplied at Fremantle monthly and spend half their time at sea traveling to and from the search area.
BEREA, Ohio (AP) — Dropped from starter to third-stringer — without playing a game.
Johnny Manziel partied his way out of the lineup during Cleveland’s bye week.
Browns coach Mike Pettine benched the polarizing quarterback on Tuesday for his off-field behavior, a move that could signal Manziel’s days with the team are numbered.
Pettine said Josh McCown will start Monday night’s game against Baltimore in place of Manziel, who was recently handed the starting job but couldn’t keep it while the team had a week off.
Manziel’s benching comes in the wake of a video surfacing of him holding a bottle of champagne and rapping profane lyrics last weekend in an Austin, Texas, nightclub.
He had promised not to bring any embarrassment to the team during its week off, and did just that and Pettine, who has been supportive of Manziel in the past, has had enough.
“Everyone in this organization wants what is best for Johnny just like we do for every player in our locker room. I’m especially disappointed in his actions and behavior because he has been working very hard,” Pettine said.
“The improvements from last year to this year have been tremendous, but he still has to consistently demonstrate that he has gained a good understanding of what it takes to be successful at the quarterback position on this level,” he said. “It goes well beyond the field.”
Manziel will not only move back behind McCown, but he’ll also be below Austin Davis on the depth chart.
Pettine met with Manziel following practice Tuesday and informed him of his choice to bench him for the foreseeable future. Pettine, whose job could be in jeopardy if the Browns (2-8) don’t demonstrate some progress the rest of this season, said owner Jimmy Haslam and general manager Ray Farmer support his decision.
The 22-year-old Manziel has developed on the field during his second NFL season.
However, despite saying he had learned from his past mistakes, Manziel, who spent 70 days during the offseason in a rehab facility specializing in alcohol and drug treatment, has not shown the maturity the Browns are looking for from their quarterback.
Before Tuesday’s practice, Pettine expressed both disappointment and frustration with Manziel, who passed for a career-high 372 yards in a recent loss to Pittsburgh. As he got ready to turn his players loose last week, Pettine spoke to Manziel about being responsible and was given assurances by the 2012 Heisman Trophy winner that he would behave.
Manziel didn’t make his plans known, but pledged that he would not become a distraction.
“I don’t think they’re going to have to worry about me this week,” he told reporters.
But it was hardly shocking when the video and photos appeared of Manziel, who entered the league with a reputation for enjoying his free time.
This time, though, the Browns weren’t so willing to excuse Manziel’s conduct.
Pettine said much of his displeasure in Manziel stemmed in him not seeming to understand that his behavior was a reflection on the team.
“You have a vision of what you want the team to look like, how you want them to handle themselves when they’re out of the building,” he said. “It’s not just pure football here, it’s truly player development on and off the field.”
“We always say to whom much is given, much is expected, and that’s true for all of our players,” he said.
McCown has finally recovered from a serious rib injury, which had initially vaulted Manziel into the starting lineup.
“My hope for him is, whatever those choices that he’s making, that they’re healthy choices and they’re good for him as a person,” McCown said. “When you’re in that room with somebody and spend as much time as we do together, there’s a connection there.”
Along with his penchant for partying, Manziel was recently investigated by the NFL for a domestic dispute. He was questioned by police in Avon, Ohio, after an in-car argument with his girlfriend.
The league announced on Nov. 17 that it did not find sufficient evidence that Manziel violated its personal conduct policy during the incident.
Still, it was another red flag for Manziel, who has made some positive steps, but just not enough of them.
“He’s done everything that’s asked as far as meetings and studying and trying to improve as a quarterback,” McCown said. “We’ve seen that. There are obviously things away from the facility that maybe people aren’t pleased with and maybe need to get cleaned up.
“It’s a work in progress. But I feel like I always see and believe the good in people. There’s some youth involved in some of the decision making that might not be the best, but I certainly don’t count him out by any stretch.”
AP NFL website: www.pro32.ap.org and www.twitter.com/AP—NFL
WASHINGTON (AP) — Hillary Rodham Clinton wants voters to know she is no friend of Wall Street. But Wall Street has frequently been a friend to her.
In the 18 months prior to announcing her second campaign for president, the front-runner for the Democratic nomination addressed private equity investors in California and New York, delivered remarks to bankers in Hilton Head, South Carolina, and spoke to brokers at the Ritz-Carlton in Naples, Florida.
Her efforts capped a nearly 15-year period in which Clinton and her husband, former President Bill Clinton, made at least $35 million by giving 164 speeches to financial services, real estate and insurance companies after leaving the White House in 2001, according to an Associated Press analysis of public disclosure forms and records released by her campaign.
The long and lucrative relationship between the Clinton family and the nation’s finance industry has emerged as a key issue in her Democratic primary race. Her rivals, including Vermont Sen. Bernie Sanders, accuse her of being too cozy with Wall Street and the industry she once represented as a senator from New York.
His criticism plays into an argument her GOP rivals have long made, that Clinton can’t be trusted and will flout the rules to get ahead.
Her backers in the financial industry say they have little expectation her family’s personal profits will influence her policymaking, noting their own opposition to her plan to raise taxes on hedge fund and private equity gains known as carried interest.
“She and Bill were both government servants all of their life, and there was a set period of time when they could make money,” said venture capitalist Alan Patricof, a longtime Clinton fundraiser, of the Clintons’ paid speechmaking. “She had to maximize her earning potential.”
The Clinton campaign also points to her record, saying it shows a history of working to regulate the industry. Negative ads run by a group called Future 45, a super PAC backed by six-figure checks from hedge fund managers, demonstrate that Wall Street expects her to follow through, aides said.
“Any honest look at Hillary Clinton’s record shows she spoke out early and often against Wall Street’s excesses in the run-up to the financial crisis,” said campaign spokesman Brian Fallon. “It’s clear they believe she will take action as president to crack down on the industry’s abuses.”
The bulk of the Clintons’ paid speeches to the financial industry came after the 2008 economic crash. From 2009 to 2014, the couple made $26 million from 109 appearances sponsored by banks, insurance companies, hedge funds, private equity firms and real estate businesses, and at those industries’ conferences and before their trade organizations.
With Hillary Clinton serving as secretary of state for most of that period, her husband brought in the bulk of the money, nearly $17 million. That included $250,000 Bill Clinton earned for mingling with investment managers in New York on May 12 — thirty days after she released a video announcing her second bid for the White House.
Advocates for boosting financial regulation say the large personal payouts underscore a political imperative for Clinton to take tough policy positions.
“She needs to show that she is not too cozy with the banks, and that makes it even more important for her to draw a clear line and propose very tough measures,” said Robert Reich, a secretary of labor during the Clinton administration who has advised Hillary Clinton’s campaign.
Exactly what the Clintons said in their speeches is hard to find. Although many of the remarks were given to large groups, reporters were typically barred. Often, Hillary Clinton’s contract expressly prohibited the remarks from being broadcast, transcribed or “otherwise reproduced,” according a copy of her agreement for one speech with the University of Buffalo.
Still, some details have trickled out.
When she addressed the National Multifamily Housing Council in April 2013, she focused on foreign affairs, including the Arab Spring and North Korea, and deflected questions about whether she would run for president, according to a post on the organization’s website that has since been taken down.
A reporter from the real estate blog The Real Deal was at her October 2014 speech to the annual convention of the Commercial Real Estate Women Network in Miami Beach. Clinton focused her remarks on boosting the number of women in their field, telling more than 1,200 attendees that industry groups must work to “achieve parity.”
“Bold choices (offer) big return,” she said, according to the blog. “It’s so important for women like us to get out of our comfort zones and be willing to fail. I’ve done that, too, on a very large stage.”
Beyond the personal income, Clinton also has close political ties to the finance industry. Over the course of her career, from her 2000 run for the Senate to the two presidential campaigns, people working in the finance, insurance and real estate industries have given her campaigns about $35 million — more than donors from any other lines of work, according to the Center for Responsive Politics.
Her top two contributors over those years were employees from Citigroup and Goldman Sachs, the center found.
Since her husband left the White House, the family’s charity, the Clinton Foundation, has collected millions more from the industry, with companies such as Barclay’s, Citigroup, Fidelity, HSBC and Goldman Sachs listed as donating as much as $5 million each.
In public remarks, Clinton casts herself as having offered a major rebuke of the industry in 2007, before the economic downturn that led to the Great Recession. “I went to Wall Street in December of 2007 — before the big crash that we had — and I basically said, ‘Cut it out!'” she said in this year’s first Democratic primary debate.
But while she suggested steps to regulate the industry in that 2007 speech, she was careful to strike a more balanced tone, saying “there’s plenty of blame to go around.”
Less than a year later, she backed the $700 billion bank stabilization plan, known as TARP, to bail out the industry in the midst of the financial crisis — a bill Sanders voted against.
“In fairness, not many in politics were on top of the issue,” said Brad Miller, a Democratic former North Carolina congressman and an advocate of tougher financial regulation. “No one knew the effects of the bad mortgages on the financial system. I certainly didn’t.”
Both Sanders and former Maryland Gov. Martin O’Malley, another Democratic rival, support reinstating the law that once separated commercial and investment banking. Known as Glass-Steagall, it was repealed in 1999 during her husband’s administration.
While Clinton doesn’t rule out breaking up the big banks, she argues that restoring Glass-Steagall wouldn’t go far enough to curb risk. Instead, she would impose a graduated fee on large financial firms that would increase as companies hold greater amounts of debt, to discourage excessive risk.
A separate tax would be levied on high-frequency trading, and she has vowed tougher criminal penalties for individuals who break the rules. She would also raise taxes on the wealthy, including closing the so-called carried interest loophole that allows some Wall Street profits to be taxed at a lower rate.
“I go after not just the banks,” Clinton told Democrats in North Charleston, South Carolina, on Saturday. “I go after the hedge funds, big insurance companies, shadow banking.”
Dennis Kelleher, president and chief executive of Better Markets, a financial watchdog group, said that while financial reformers are wary of her family’s relationships on Wall Street, her agenda includes “some very tough things that no one else is talking about.”
Those proposals aren’t worrying her backers on Wall Street, who argue that her time representing New York gives Clinton a deep understanding of how their industry works. They note that she’s avoided vilifying their industry as has Sanders, who recent described their business model as “fraud” or even President Barack Obama, who angered some of his donors when he called Wall Street investors as “a bunch of fat cat bankers” in a 2009 interview.
Her proposals also don’t do much to win some who feel the better choice for the industry will be found among the GOP’s candidates.
Donors working in the finance and insurance industry have given $22 million to Texas Sen. Ted Cruz and $21 million to former Florida Gov. Jeb Bush and their affiliated super PACs — roughly three times as much as to Clinton and the outside group supporting her, according to Crowdpac.com, a nonpartisan political research company.
“People on Wall Street view her with a level of caution that they didn’t view President Clinton with,” said Anthony Scaramucci, a major Republican donor and founder of SkyBridge Capital, which paid Clinton $175,000 to address its annual investment conference in 2010. “It’s this progressive nonsense.”
Associated Press writer Julie Bykowicz contributed to this report from Washington.
Follow Lisa Lerer and Ken Thomas on Twitter at: http://twitter.com/llerer and http://twitter.com/kthomasdc