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Bartz: Yahoo has pride, but still needs work

As investors wonder if Yahoo's stock is ever going to take off, CEO Carol Bartz tries to reassure them Wednesday that the company is focused and improving.

Yahoo once again has pride in its company, said CEO Carol Bartz Wednesday, just after outlining the dozens of ways in which the company needs to improve.

Investors and their Wall Street representatives are gathered in Sunnyvale, Calif., Wednesday for an investor day that was closed to the press, but available via Webcast. Yahoo's stock has gone on quite the roller-coaster ride over the past 12 months but as of Wednesday, it's almost exactly where it was a year ago. So how is Yahoo going to fix that issue?

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By modernizing its technology and improving the amount of time that its users spend on its site, Bartz said, in a performance that would have disappointed George Carlin. That will involve serving up better content across its media properties, adding social-networking features into Yahoo Mail, and overhauling its back-end ad serving systems to make sure its customers can serve the "right ad at the right time" to its users, she said.

Yahoo made a splash right off the bat by announcing a partnership with Zynga, makers of social games like Farmville and Mafia Wars on Facebook. Users will be able to play those games on Yahoo's pages while still being able to share updates "across multiple social experiences," according to the press release, in a coy way of referring to Facebook.

Bartz was less shy about acknowledging the rapid growth of Facebook, which recently surpassed Yahoo in terms of the number of ads it serves (although Yahoo's display-ad revenue is still higher).

"There's really three big guys" on the Web right now: Google, Yahoo, and Facebook, Bartz said. Google is search, Yahoo is content, and Facebook is social, in the way Bartz sees the world. And "there's a place for all of us on the Web."

So while the Zynga partnership will give Yahoo a better social experience, improving its content is what really drives engagement across Yahoo's site. Yahoo is doing that through more ways to personalize the Yahoo experience and offering up more content choices through its acquisition of Associated Content last week, Bartz said.

None of it matters without quality ads, however. Yahoo is in the process of updating its ad-serving technology in hopes of matching ads and advertisers with users in a faster and more comprehensive way, which should lead to better returns for those advertisers and eventually, higher prices.

All of this has been part of Yahoo's standard pitch for several months, after Bartz settled into her role and cleaned house, and investors may not be excited to keep hearing the same promises over and over. But there's one key difference between now and last year, Bartz said.

"Yahoo has its focus, it is excited about its future, and it has its pride back. I think you'll see that by the end of the year," she said. Executives will spend much of the day reviewing Yahoo's businesses, focusing on ads, the search deal with Microsoft, and the first official appearance of new product guru Blake Irving.