It’s been a whirlwind couple of weeks at Yahoo, following the announcement to outsource Internet search technology to Microsoft and Yahoo stock’s subsequent 15 percent sell-off.

But the scene in Sunnyvale, California took a really odd turn on Friday when a staff memo left some Yahooligans wondering if the company planned to ditch the whole Internet thing altogether and get into the hospitality business.

In an 800-plus word memo, new Customer Advocacy EVP Jeff Russakow (pinch-hitting on the weekly memo for vacationing CEO Carol Bartz) held forth on the merits of all the hotels he’s stayed at.

Luxury hotels like the Ritz Carlton and The Four Seasons delight guests with “incredible culinary extravaganzas, personal activity and shopping attendants, and state-of-the-art spas promising to erase every worry and wrinkle,” wrote Russakow.

Good stuff, to be sure, he said, but too expensive for the average Joe.

More to his taste is Joie de Vivre, a chain of 40 boutique hotels in the U.S. which has built a business buying up “older, drab hotels in great locations,” refurbishing them with a hip veneer and developing a fanatical following without the costs of a huge staff and a rich menu of offerings.

That model, the memo suggested, could work at Yahoo as the company seeks to redefine itself and reignite its growth.

“Like JDV, the primary challenge for us is not to delight them with fancy bells and whistles and extravagant services,” explained Russakow, “but to make users’ every day experience on Yahoo! personally relevant, and even on occasion an identity refreshment.”

There you have it, the new Yahoo: an identity refreshment.


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