The latest data may prove to be a shot in the arm for billionaire investor Carl Icahn, who is gearing up for a proxy war against Yahoo's board.
A monthly analysis released by comScore Inc. (SCOR | news | PowerRating | PR Charts ) revealed that Google sites had 141.1 million visitors in April, an increase of 18% from the same month last year. Meanwhile, Yahoo sites fell to second place with only 140.6 million visitors for the month. Microsoft Corp. (MSFT | news | PowerRating | PR Charts ) was third with about 121 million visitors.
"April was a very active month," noted Jack Flanagan, executive vice president of comScore Media Metrix. "Google took the top property position, thanks to continued search growth and rapid growth at YouTube."
Google has long been the internet's leader in search, but its audience has trailed Yahoo's when counting other services such as e-mail and photo sharing.
But now, Google has the Picasa online photo-sharing service, which competes with Yahoo's Flickr. Google has also launched a finance site, while its Gmail e-mail service continues to grow.
Google also became the leading video-sharing Web site after its $1.76 billion purchase of YouTube in November 2006.
ComScore's analysis shows that Yahoo still leads in page views, however, with 33.6 billion page views compared to Google's 28.7 billion. That suggests Yahoo's visitors spend more time there or return more often. Many Google users make a simple search request and quickly go elsewhere based on the results.
Meanwhile, other recent data shows that Google continues to expand its lead over Yahoo as the leading site for internet searches, with a report from Hitwise showing that Google accounted for 67.90% of all U.S. searches in the four weeks ended April 26.
Google has seen its percentage of internet searches increasing steadily in recent months, edging up from 65.98% in December of 2007. At the same time, Yahoo has seen its percentage of searches slipping, falling to 20.28% in April from 20.88% in December of last year.
Microsoft has also seen a steady decline in its much smaller percentage of search results, which have slid to 6.26% in April from 7.04% in December of 2007.
The release of the data comes at a difficult time for Yahoo, which has come under increasing pressure from billionaire investor Carl Icahn, who revealed on Thursday that he intends to launch a proxy fight to replace Yahoo's current slate of directors.
In an open letter to the company, Icahn accused Yahoo's board of directors of "acting irrationally" in rejecting Microsoft's $47.5 billion buyout offer.
Icahn said that along with many other Yahoo shareholders he believes a combination between Microsoft and Yahoo would be a force strong enough to compete with Google.
"It is quite obvious that Microsoft's bid of $33 per share is a superior alternative to Yahoo!'s prospects on a standalone basis. I am perplexed by the board's actions," Icahn said.
Icahn also disclosed that during the last few days he has purchased about 59 million shares and share-equivalents of Yahoo as well as formed a ten-person slate of directors to contest elections against the current Yahoo board.
The proposed directors include Dallas Mavericks owner Mark Cuban, former CEO of Viacom Inc. (VIA | news | PowerRating | PR Charts ) Frank Biondi Jr., and Icahn himself. Further, Icahn has sought permission from the Federal Trade Commission to buy up to $2.5 billion worth of Yahoo stock.
Responding to Icahn's letter, Yahoo said later on Thursday that the billionaire investor has misunderstood the Microsoft offer, adding that the current ten-member board of Yahoo remains the best and most qualified group to maximize value for all Yahoo shareholders.
"Unfortunately, your letter reflects a significant misunderstanding of the facts about the Microsoft proposal and the diligence with which our board evaluated and responded to that proposal," Yahoo Chairman Roy Bostock said in a letter responding to Icahn.
Yahoo also noted in the letter that there is currently no fresh offer on the table after Microsoft withdrew its $33 per share bid. Further, Yahoo said it is not in the best interest of shareholders that Icahn force a sale to Microsoft, noting that Yahoo is still open to considering other offers.
Microsoft had been eyeing the biggest-ever technology takeover after failing to compete with Google in the online advertising market, which is estimated to grow by $80 billion by 2010.
However, Yahoo's board wanted an offer of $37 per share, even though the company's stock has not reached that level in more than two years.
The latest data could create problems for the current Yahoo board at its July 3 annual general shareholder meeting. There is a chance that investors might feel unhappy with the Yahoo board's rejection of Microsoft's increased bid, as the current data doesn't appear to justify its action.
Following Yahoo's rejection of Microsoft's sweetened bid, Yahoo shares declined 15% on May 3. The stock closed Friday's regular trading session at $27.66, down $0.09 or 0.32%. The stock has now advanced 13.5% from the closing level of $24.37 on May 3.
Meanwhile, shares of Google have been more or less rangebound in recent weeks after showing a strong upward move in late-April. Google stock jumped 20% on April 18 after the company reported strong quarterly results, and it continued higher until reaching a three-month closing high of $594.90 on May 5. Google ended Friday's trading down $0.93 or 0.16% at $580.07.
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