Yahoo's Terry Semel bids goodbye to the company

Internet mammoth Yahoo Inc. announced Thursday that its non-executive chairman and former Chief Executive Officer Terry Semel has stepped down from the board. Semel will be replaced as chairman by long-time board member Roy Bostock, a director since 2003.

Semel, a native of Brooklyn, New York who joined Yahoo as CEO in 2001, resigned from his post today after several months of discussions with the board, which now has 10 members, nine of whom are independent.

While announcing his resignation, Semel said in a prepared statement: "It has been an honor for me to work with Yahoo's incredibly talented people over the past seven years, and I'm proud of all that we've accomplished during that time."

"With the company moving forward under new leadership, I believe this is an appropriate time for me to step down from the board," he continued.

His resignation comes after the Sunnyvale, California-based Yahoo lost the Internet search market to Google, which is now more than twice as big in terms of sales. Last year he saw increasing pressure from company shareholders when the company’s share price plunged.

Last year in June, Semel announced his departure as CEO, and the co-founder Jerry Yang took the job. He hasn't been involved in company's daily operations since Yang replaced him as CEO, although he still occasionally appeared at high-tech gatherings.

Semel faced much criticism for failing to meet arch-rival Google's challenge in Web search and advertising. In addition, he failed to keep company firm against the rise of social networking sites such as MySpace and Facebook.

He also faced criticism for his salary package, when Yahoo gave him a compensation package valued at $71.7 million in 2006. That was the year when the company's market value slipped by 35 percent, or about $20 billion.

Before joining Yahoo, Semel, 64, was a long-time Hollywood studio executive. During his 24-year career in Hollywood, he built his position by working with Warner Bros. and Walt Disney Co. Speculations are high on air that Semel may seek to return to his previous role in any Hollywood studio.

Yahoo is engaged in pitched battle with Mountain View-based search leader Google and other companies over the lucrative keyword ads, which are generally text ads targeted to a user's search terms or the contents of a Web site.

Google Inc.’s ease to use, simplicity of design and massive database listings have made it the Numero Uno search engine in the world. The Web search leader is now extending its design magnificence in new directions by making the search services more comprehensive.

Yahoo shares jumped 13 cents to $19.18 in NASDAQ Stock Market trading.