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Yahoo's Bartz exports personal style to Europe

With 16 months at the helm, Yahoo CEO Carol Bartz defends her company, touts the advertising business, and takes potshots at Facebook.

Yahoo CEO Carol Bartz speaking at a press conference Wednesday in London.
Yahoo CEO Carol Bartz speaking at a press conference Wednesday in London. Stephen Shankland/CNET

LONDON--After 16 months at Yahoo's helm and an expectations-beating first quarter, new chief executive Carol Bartz brought some of her down-home style to the Old World for her European press debut Wednesday.

Bartz fielded questions, touted Yahoo's refurbished strategy, and, flanked by the company's head of European operations, touted news that the Internet pioneer won sole rights to show game highlight videos for the Premier League, the 20-club group top of the English football competition pecking order. Bartz was here as part of a tour to meet senior ad agency executives in London and was due for a more formal day-long meeting with an advertising audience in Paris.

Bartz, characteristically, shucked the buttoned-down ways of most CEOs. When asked her motives for leading Yahoo, she indicated it wasn't for the money.

"I've got plenty of money. I don't need to have everybody think I'm an asshole or anything--I'm having fun," she said. "You think it's so much fun answering your questions? If I didn't think there wasn't a good bottle of white wine at the end of it, I probably wouldn't do it," she quipped.

She spent a lot of the time defending her company's record. One example was social networking, best exemplified today by Facebook and Twitter.

"You're going to see us building up a lot more of a social graph in Yahoo," she said, but meanwhile, she made the case for a broader definition of the concept that involves communication and commentary as well as status updates.

"Remember when social meant (if I were a) social person, people talk to me? Now social has to mean Facebook," she said. "We added comments on our news site. They took our site down the first day, we had so many comments. We had 160,000 comments on one article on health. People want to comment, blog, and yes, check their friends. Yahoo Mail does more photos in a week than Facebook does in a month."

Another Facebook jab came as Bartz made the case that Yahoo will continue innovating.

"Do not count Yahoo out relative to interesting and exciting things. Remember how dead Apple was for eight years? There are lot of things in technology you can either invent or stumble upon," she said. "You might say Facebook was stumbled upon, depending on how you look at that original lawsuit."

She expects to lose out this year to Facebook and later to Google in measurements of how much time people spend on the Web site. She argued, though, that there are different sites for different uses, and that Yahoo has a strong position. "There's plenty of growth and upside for us," she said.

Newcomers also haven't always learned Yahoo's lessons in operating at tremendous scale, with 600 million monthly users, she said. Yahoo will buy 160,000 more servers for its data centers, she said.

Rich Riley, managing director of Yahoo's European operations
Rich Riley, managing director of Yahoo's European operations Stephen Shankland/CNET

Bartz offered a couple handy taglines for those seeking a quick-grab description of the company. "Our mission is to combine your world, the world, and the Internet," she said, though not without indicating some impatience that such slogans oversimplify reality. Closer to her heart, apparently, is the "science, art, and scale" sales pitch for advertisers that combines hard research with creative options and a global reach.

Although she graded her first year at Yahoo with a B minus--mostly because she didn't install new management as fast as she would have liked--she said her performance couldn't be separated from Yahoo's difficult circumstances. "There's a lot of context there that's interwoven," she said: "the context of the economy, of having Carl Icahn on your board, of picking up a company after the Microsoft debacle."

Yahoo splits its revenue about 50-50 between search advertising and display advertising. The latter category is sometimes called brand advertising since it's often meant to teach potential customers about a company's image or vision rather than to get them to buy something immediately. Google makes the vast majority of its money from search ads, which Yahoo argues aren't a good vehicle for brand ads.

With the economic recovery, Yahoo's display ad revenue increased 20 percent in the first quarter. But Rich Riley, managing director of Yahoo's operations in Europe, the Middle East, and Africa, also said the fact that that rate exceeded analyst expectations for the ad market recovery shows Yahoo itself accounted for some of the growth.

"We took more than our fair share of the recovery," Riley said in an interview. Display advertising "is getting its mojo back in a big way."

Part of that improvement, Riley said, is because display advertising is getting more of the accountability that search advertising enjoys--a direct link between money spent on a campaign and desired results such as a telecommunications company signing up more subscribers.

Bartz attributed Yahoo's display-ad growth to premium advertisements in which advertisers pay more to guarantee top placement.

"It's the guaranteed ads and the pricing that drove the quarter," she said. "Ad prices went up, and we sold them anyway."