Yahoo's board could decide to promote from within, though not without risk. In firing Bartz, the board named CFO Tim Morse as interim chief. It seems unlikely he'll be installed permanently since he was hired by Bartz and, though he's well-regarded as a cost-cutter, is also associated with Yahoo's revenue slide. A clue to his prospects might be found in Kara Swisher's description at AllThingsD of Morse's presence at Yahoo's "all-hands" meeting on Wednesday, where he was apparently nothing more than a supporting player to company co-founder and former CEO Jerry Yang. (Yang insisted that Yahoo is "not for sale," but there's little reason to believe him given the company's distress.)
A more likely internal candidate is Ross Levinsohn, Yahoo's executive vice president for the Americas. He's in charge of Yahoo's faltering display-ad business and its popular news, sports and finance properties -- in other words, Yahoo's most important businesses. Levinsohn came to Yahoo a year ago from Fuse Capital, an investment fund focused on digital media. As a News Corp. executive, he was in charge of that company's acquisition of MySpace, which went on to become a spectacular failure.
A strong candidate is Jonathan Miller, News Corp.'s chief digital officer. He was CEO of AOL for four years until 2006. Miller won a gold star when he unloaded MySpace from News Corp. earlier this year. He was once a considered for the top Yahoo job, but was blocked by Time Warner, former owner of AOL, because of a noncompete clause. Given all the situation at News Corp., the timing perhaps could be august.
The timing probably couldn't be worse for another potential candidate, though: Tim Armstrong, CEO of the beleaguered AOL (AOL). Not only is he struggling to make the disparate parts of his company work together, he's also facing heavy criticism for his handling of the mess surrounding Michael Arrington and TechCrunch. Still, if Yahoo and AOL were to partner in some way, Armstrong could come out on top.
Yahoo has to endure some major changes no matter what, but nobody seems to know what they should be. It could be acquired, or it could sell off major chunks of itself -- perhaps its Asian businesses including Alibaba and Yahoo Japan -- and use the cash to make acquisitions of its own. For years, people have been asking: "What is Yahoo?" Any new leader has to be able to answer that question in a single, concrete, believable phrase.