Metue.com

In breaking news, Yahoo CEO Terry Semel is stepping down from the helm of the Internet giant.  He will stay on as a non-executive chairman but otherwise be replaced by Yahoo founder, and former internet wunderkind, Jerry Yang.

Semel’s six years began with high hopes that the former Warner Brothers chairman, and his Hollywood connections,  would be the man to guide  Yahoo through the transition from Internet to Major media.  Throughout his tenure, however, Yahoo has failed to live up to the expectations and its potential. The company has been criticized for losing it’s innovative edge and failing to keep pace with Google in search.(Currently, Yahoo’s 26% of the US Search market trails well behind Google’s 49%).

While the development of Yahoo’s Panama ad-platform, and its recent acquisition of Right Media, have buoyed hopes somewhat, the companies financial performance has been lackluster so far in 2007.

In the face of unmet expectations, speculation about a leadership change had been rampant, especially following Terry Semel’s clash with disillusioned shareholders at the company’s annual meeting last week but the suddenness of this change has to be a surprise for all.

In a statement, Semel said “"This is a time for new executive leadership, with different skills and strengths, to step in and drive the company to realize its potential," he continued, "It is the right thing to do and the right time is now."

In taking on the new role, Yang will shoulder a heavy burden to restore the company he helped create to the prominence it’s held in the past. The job duties, however, won’t be an entirely new transition. Jerry Yang has remained active in developing Yahoo’s strategy and remained a member of the company’s board of directors. He is also on the board of directors of networking giant, Cisco, and a member of Stanford University’s Board of Trustees.