America's bloggers rushed to celebrate Terry Semel's resignation as chief executive of Yahoo! today, presenting the step-down as the removal of an unwelcome Hollywood import - the "Forrest Gump" of the tech sector - from Silicon Valley.

“The Valley will take over Hollywood. Not the other way around,” concudes Michael Arrington of Techcrunch, on the news that Terry Semel, a former Warner Brothers executive, has stepped down as chief executive of Yahoo!. “On a personal note, I am glad to see [him] gone”.

The tone was typical.

“Fortunately, we had a business obituary prepared,” added the Valleywag site, striking the same waspish note over the fate of the Warner Brothers veteran – a man seen overwhelmingly by the blogosphere as an outsider who failed to “get” Silicon Valley during his six years at the helm of Yahoo!.

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“True, he presided over Yahoo!'s recovery from the last internet downturn. But insiders regarded that as luck, rather than skill. Even when Yahoo! was riding high, other internet execs described him as the Forrest Gump of the industry, someone with a charmed life, but a limited understanding of the new medium to which he'd come, late in his career.”

A collision of cultures that delivered results may have been endured for longer, Peter Cohan suggests at Bloggingstocks.com. But the clash of Mr Semel’s generous remuneration with Yahoo!’s dour performance was beyond the pale.

“He has taken home some truly outrageous pay - a total of $452 million in salary, bonus and stock-option exercises since April 2001 - during which time Yahoo! stock has risen four-fold,” Mr Cohan said.

“However, in the last year the disconnect between Semel's pay and Yahoo!'s performance became too much to take … his total 2006 pay was $107.5 million during which time Yahoo!'s stock fell 35 per cent. And directors concluded Yahoo! was just not catching up fast enough with Google, so Semel had to go.”

Meanwhile, the bloggers wasted no time in spelling out – in excruciating detail - the case for Mr Semel’s departure.

“For a long while, it didn't matter that Semel had missed the chance to acquire Google for $1 billion, before the search engine upturned the internet sector and reduced Yahoo! to an also-ran,” Valleywag says – one of the kindest comments made of Mr Semel’s legacy.

Next, however, it lays into “Semel's pet project, a misconceived Hollywood operation run by Lloyd Braun to make the internet giant a fully-fledged media company” before highlighting damaging delays to Yahoo!’s new search-based advertising technology, Panama, the failure of Yahoo! to spot “the social networking phenomenon” exploited by groups such as MySpace, and bungled attempts to acquire Youtube and Facebook.

“The final blows,” it concludes, came in the form of a leaked internal memo by Brad Garlinghouse, one of Mr Semel’s lieutenants “calling for new focus, and, between the lines, for new top management” and “a play by opportunistic hedge funds, who saw a chance to take positions in Yahoo!, on the cheap, force a change in management or direction, and make a quick profit.”

So – what next for Yahoo? As CNBC notes in an online article pointed at by several bloggers, the group “may be ripe for an activist play that forces the company to explore strategic alternatives”.

The article adds: “While it still remains in the realm of the speculative, bankers, activist investors and media executives have told CNBC that Yahoo may be pushed to explore alternatives, and if that were to occur, the belief is that Yahoo would find interested parties in News Corp, AT&T, TimeWarner's AOL, Microsoft and Comcast.”

Techcrunch adds: “We’ll see if Yahoo! will be carved up or merged with Microsoft, Google, AOL or someone else, or if the company has the vision and will to push forward and find relevance again.”

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