The current Yahoo board has entered into a “truce” with millionaire activist investor, Carl C. Icahn.

In exchange for agreeing to end his proxy bid to oust Yahoo’s directors from the board of the search engine company, Mr Icahn has been granted three seats on the Yahoo board, which has been expanded from 9 to 11 seats. Mr Icahn will get one seat and another will probably be given to former chairman and chief executive of AOL, Jonathan Miller.

Mr Icahn, a vocal proponent of selling Yahoo to Microsoft is not expected to stop his efforts to sell all or part of the search company to the Redmond-based software giant. Let’s see if he continues to stir up trouble from within the top echelon of the company…

Source: Miguel Helft, “Yahoo Deal Wards Off Proxy Fight”, The New York Times, July 22, 2008

Microsoft plans to spend just over $100 million to acquire semantic search engine company Powerset.

Powerset’s semantic or “natural language” technology aims to deliver search results based on what search engine users are really looking for, due to making meaningful connections between the words typed in by such users.

While Google is said to be using semantic technology to a limited degree, it has generally dismissed Powerset’s approach. Consequently, Google’s search results are still mainly based on the individual words typed in by its search engine users.

With the popularity of Microsoft Live lagging significantly behind Google and Yahoo, Microsoft’s purchase of Powerset is undoubtedly a bid to increase its share of search, based on delivering better quality search results. However, many believe that while theoretically appealing, semantic search is practically impossible to implement in reality.

Source: Matt Marshall, “Microsoft to buy semantic search engine Powerset for $100M plus”, VentureBeat, June 26, 2008