Yahoo! mulls acquisition of social media firms

“It’s a good time to be buying now,”  he told Reuter, pointing to valuations that have come down from levels six to nine months ago.

While declining to give specific names, Balogh said the firm has had conversations with companies about partnerships and “more interesting” possibilities, such as on building out its platform and basic computing in addition to search.

“I can guarantee you there will be some acquisitions, and we will do some stuff in-house,” Balogh, said. Yahoo! will introduce new products that will give users a more unified experience across its network of websites and showcase the company’s strategy to grow again, after much of 2008 was marred by the failed deal talks with Microsoft Corp.

Decline in sales

Yahoo is striving to revive its fortunes as sales decline because of the recession and competition from other Web heavyweights, including Google Inc and Facebook.

While conceding that Google has “won the game” of search as we know it today, Balogh says search will be about much more than “10 blue links” in the future. “The thing I will tell you is that, core to great experiences for people online may not necessarily be this version of search,” he said, adding “I believe search is going to be far richer... there’s a whole other round or two to go in the search game and that’s where we intend on playing.

Further, a source familiar with the matter said that Yahoo! Chief Executive Carol Bartz & Microsoft CEO Steve Ballmer have talked about partnering on search.

However, Balogh said any decision about a search deal was up to Bartz and the company’s board. But he said that whatever happens, Yahoo! will continue to invest in its own search capabilities.