Yahoo reshuffles, and Google follows it in Asia

Today's news, slipped in after the markets closed, was that Yahoo has finally reshuffled its top management, with Terry Semel out as CEO and Jerry Yang in. In an attempt to appease frustrated shareholders as Yahoo continues to lag behind Google in popularity (both for searches and for ad sales), Susan Decker has also been promoted up to the newly-created role of president to support Yang.

Jerry Yang, who was one of the founders of Yahoo, has in recent years focussed a lot of his attention on the company's growth in Asia. The search giant has struck some very fruitful deals in the East, for example partnering with Softbank in Japan to offer a hugely popular Internet and broadband service. And when things started to go awry in China, Yahoo decided to bank on a similar type of arrangement, striking up a joint venture with local partner Alibaba, of which it now owns 40%. It's also attracted controversy for complying with Chinese authorities to provide information about its users (with them subsequently landing in jail for making anti-government statements).

Human rights notwithstanding, if Yahoo was hoping that it had stolen a march on Google in the East, Jerry Yang might have to rethink the strategy. Last week, Google announced it would team up with the Chinese portal Sina to offer services on the mainland. Google already has a respectable portion of the market for search in China (some 19% according to Analysys International), but it has found it difficult to gain the same kind of dominance in China as it has in other (western) parts of the world. Now Google is following in the footsteps of its rival Yahoo in teaming up to target the market. Google has also taken a similar route in South Korea, and one wonders if Japan or other Asian countries might also be JV targets.

Chatting about this deal with our Hong Kong-based correspondent Craig, he relayed this anecdote: "I tried using Google inside China's great firewall and it was amazing how frustrating and useless it is as everything's blocked. The way China controls stuff, you really need a partner."

He went on to say that the Sina deal makes sense as China will continue to focus on holding up national Internet champions. China doesn't have laws enforcing joint ventures for foreign Internet companies that want to do business in the country (as it does for infrastructure-based businesses like telecoms). But the moves by Yahoo aligning with Alibaba and Yahoo teaming with Sina demonstrates that this seems to be the de facto route anyway.