BoomTown liveblogged Yahoo’s “chalk talk” about search earlier today, which was an update of what the Internet giant is up to in the competitive space that includes Google and Microsoft.

Presenting at the event were Prabhakar Raghavan, head of Yahoo Labs and Yahoo Search Strategy; Larry Cornett, VP of Consumer Products; and Marc Davis, chief scientist of Yahoo Mobile.

At its HQ in Silicon Valley last week, Google put on a similar show-off, called “Searchology,” about its own latest search innovations.

And although they are clearly No. 1 and No. 2 in the search space, both Google (GOOG) and Yahoo (YHOO) are bracing for the launch a major overhaul of the Microsoft’s (MSFT) search offering, which is expected next week at the D: All Things Digital conference and code-named “Kumo.”

11:45 a.m. PDT: A delightful lunch was offered to a room full of tech reporters at the San Francisco offices of Yahoo’s outside PR firm, Outcast Communications.

But all the munching was quickly swept aside by the aggressive tone of the speech to be delivered by the normally gentle-looking Yahoos.

Apparently, top Yahoo execs want to “kill the 10 blue links.”

Yipes!

“Nobody really wants to search,” said Raghavan, describing a broken consumer experience and how Yahoo wanted to fix it. This has been a bell he has been ringing from last fall, in fact.

But we all were soon deep in the weeds of tech, as he noted that Yahoo wanted to move from a “Web of pages to a Web of objects.”

It still sounded very, very Webby.

12:01 p.m.: Soon, Raghavan started to talk about Yahoo products, such as Build Your Own Search Service (BOSS), which he says has generated almost as many daily queries as Microsoft’s whole search offering.

Snap!

Next up was Cornett, who began talking about intent and how Yahoo was trying to weave what a consumer wants in with what is displayed.

That means “helping users accomplish that goal by connecting objects in the real world.”

He trotted out Yahoo’s Search Pad offering, which is simply a way for people to keep track of their searches online, instead of on a dopey scrap of paper that the dog eats.

Cornett also showed how embedded music, video and other structured data are inserted into mostly dull search results.

Yahoo, in other words, is going to know what we want and give it to us–even before we know we want it. Sounds like my mother!

12:15 p.m.: Cornett reeled off lots of stats about its SearchMonkey technology, which is a year old.

There was a picture of a monkey with a birthday hat, natch! (See here!)

SearchMonkey, according to Yahoo, is a “framework for creating small applications that enhance Yahoo search results with additional data and structure.”

Cornett then invited up Facebook software engineer Alex Moskalyuk to talk about building apps with SearchMonkey.

Lots of tech talk that was actually incomprehensible to the reporters gathered, although they all scribbled away (I, at this juncture, chose to eat another sandwich).

Here is one line: “Originally used XPath extractor, switched entirely to hCard.”

Welcome to my world! It’s like some telephone guy talking apart a handset and explaining the guts of the device, when I am only interested in making a call.

12:23 p.m.: Next up: Matthew Hertz of Pipl.com, a people search engine built on Yahoo’s BOSS.

People search was, he said, a “deep Web challenge.” Indeed, there needs to be an easier way of finding out about a potential date online!

Actually, Pipl is a nice service and useful too, and Hertz is right that Pipl should not have to reinvent the search wheel to take advantage of all the data already available on big search services.

12:29 p.m.: Yahoo’s chief mobile geek Marc Davis was up, talking about “answers, not just links.”

Now they’re talking!

Actually, mobile is a key search arena with the increasing popularity of smart phones.

That means knowing everything from movie times to weather to flights to cheap gas prices nearby immediately.

Twittery humanity needs to know now!

Yahoo’s offering is called oneSearch. which is also a good product. It better be. “For many people in the world, their phone is the way to access” the Internet, said Davis.

12:40 p.m.: Now, the Yahoos summed up “What’s Next?”

Let’s review: Kill the blue links! Intent! Objects! Open! Mobile!

Raghavan then gave me a great joke by using the term: WOO, which is Web of objects. Apparently, they go around Yahoo talking about getting to the WOO.

It sounded naughty and I liked it.

Time for Q&A!

A question was posed about how quickly Yahoo rolls out these technologies, which are often limited in “bucket tests” of smaller groups of users.

As soon as they can, of course.

Next question was about how WOO impacts online ads. “It takes us away from a marketplace of keywords to a marketplace of intent,” said Raghavan.

That means advertisers can eventually make better ads. Oh, joy.

Then a question about when links are appropriate and when rich search should prevail.

Well, it depends on the user!

Next, a question about the currently trendy “real-time” search–a magical power that the blogosphere has, in its infinite hype-osity, bestowed on Twitter.

Raghavan called it a “buzzword” and I agreed.

Cornett added, correctly, that it should be about precision and accuracy in search, as well as serving “fresh” data. Fresh was a diplomatic word for whatever the mostly useless tweets are yammering on about at any given moment, which are most pointless.

The next question was about how soon a lot of this cool rich search data gets to the masses. Answer: Some of it is in testing and some is live systemwide.

I then asked about whether Yahoo would shove out the bells and whistles if, say, Microsoft’s new search service has a lot of the same features.

Cornett noted that Yahoo will only roll out after testing showed good results.

In other words, Yahoo will kill (or drink) no blue links before their time!

More questions about rich data, with one that makes the point that Yahoo was originally known for “curation,” which was its original business as the Web’s first truly useful directory.

It was.

1:01 p.m.: Still more questions.

Someone asked the Yahoos to comment on a recent post on TechCrunch that said the company was not developing for BlackBerry and focusing intently on the iPhone from Apple (AAPL). An exaggeration, said Davis, which was a diplomatic way of saying the story was wrong.

Blackberry users can now relax.

While the “news” that Google was in “late-stage” talks to acquire Twitter, which TechCrunch reported last night, certainly sounds exciting, it isn’t accurate in any way, according to a number of sources BoomTown spoke to close to the situation.

In fact, Twitter and Google (GOOG) have simply been engaged in “some product-related discussions,” according to one source, around real-time search and the search giant better crawling the microblogging service.

Said a source close to Twitter: “There was a discussion with [Google executive Marissa Mayer's] group about real-time search and about product stuff. It was a couple weeks ago. It was very preliminary…and that was that.”

More importantly, said another source about the idea of an imminent acquisition or serious or even early talks: “Seriously, no negotiations, no deal, nada.”

So for all those Twitterers madly typing 140 characters and caught up in the grand idea of Twoogle, we return you to your regularly scheduled tweeting.

Of course, there has been a lot of analysis, put forth by many, including me, that Google should think about acquiring Twitter.

It is the microblogging service’s likeliest acquirer, in fact. And there is no question Twitter is being watched closely by Google.

But sources at Google stressed that a strong partnership–especially in light of the growing size of the Facebook social-networking site–is what the company is most interested in at this point in time.

That could change at any time, of course. Google or anyone else could plunk down more than $1 billion in cash, and I cannot imagine Twitter’s investors would or could resist. Nor should they.

And what if, for example, Microsoft (MSFT) offered some huge cash payday for Twitter? In that case, I am certain Google would jump into the faceoff, backing up a giant Brinks trunk to the door of Twitter’s San Francisco offices.

And the reaction such an idea has gotten with this round of rumors will surely be studied at Google.

But this is all just pure speculation and should be couched as that. And that does not mean there are talks going on now, as TechCrunch reported so firmly.

And that’s also true for a range of other companies–from Microsoft to Yahoo (YHOO) to News Corp. (NWS) to Time Warner (TWX) unit AOL to Cisco (CSCO) to Comcast (CMCSA) to the big telcos–that would also be interested in buying Twitter or partnering with it.

And Facebook already tried and failed to buy Twitter last year, which BoomTown chronicled in a post in November, for $500 million in cash and stock of the social-networking service.

Why? Because although Twitter is still small, with seven million users, it has a definite momentum in the red-hot real-time online status update space.

And while I give it a hard time for its utter lack of a business plan or revenue to speak of, the well-funded Twitter is also at the beginning of a long runway of possibility that could yield it a higher price later, if it so chose to sell at all.

Moreover, if Twitter’s investors and founders wanted to sell, they wouldn’t have taken a recent round at $230 million valuation, because it would imply a $750 million to $1 billion purchase price, and no one could pay that right now.

Even the mighty Google could not–which does not typically overpay for companies.

More likely, Google would surely get killed by investors for spending that much on a revenue-free company, especially since it is still getting beat up for the pricey YouTube deal it made when times were great.

Lastly, Twitter’s founders have expressed the desire to take the company out for a longer ride, even if some of its investors would love to cash out if offered a crazy price.

“Why would the company do something like this right now?” said a source close to Twitter, in a typical sentiment. “The company’s on a tear right now.”

In fact, last night in an appearance on “The Colbert Report,” Twitter co-founder Biz Stone explicitly said Twitter planned to be a “strong, profitable, independent company.”

While entrepreneurs have said this and then quickly sold out, it is not the case now for Twitter, unless it got some insane offer, said numerous sources.

TechCrunch, which slapped a loud headline on its first post, “Sources: Google in Late-Stage Talks to Buy Twitter,” then changed it to “Sources: Google in Talks to Acquire Twitter (Updated).”

What’s next? “Google and Twitter Have a Lovely Organic Lunch and Discuss Trading T-Shirts (Updated Update)”?

The TechCrunch report, penned by Michael Arrington, also added a let’s-just-cover-all-our-bases update at the bottom of the ever-changing post that then hedged the news it had just hyped.

This is not new for the tech blog, especially related to Google.

On July 28, 2008, TechCrunch reported: “Google In Final Negotiations To Acquire Digg For ‘Around $200 Million,’” and said there was a letter of intent signed.

While the pair did hold ultimately unsuccessful talks, they never got even close to final.

And on February 6, 2008, TechCrunch had a post with the headline, “Rumor: Is Google About to Buy Bebo For $1 Billion To $1.5 Billion? Or Will it Be MySpace?”

Hmm, not so much on the about to buy Bebo. In fact, Google was never in what could be described as serious talks, and Bebo was sold to AOL, the lone bidder, for $850 million a month later.

Thus, the third time is, no surprise, not a charm either.

Please see this disclosure related to me and Google.

Pure Digital, the maker of the popular Flip digital video cameras, has sold itself to Cisco (CSCO) for $590 million in stock.

The deal, which had been rumored last week by TechCrunch, was announced this morning by Cisco.

The innovative San Francisco-based start-up has made it big from its modest roots as a white-label digital video camera shrink-wrapped for themes parks and drug stores.

But the simplicity of its line of relatively inexpensive cameras, including the recently released Mino HD, has made it a huge consumer success, which is no easy task in the devices arena.

Using its own software, a user can plug the Flip into a USB port of computer to upload digital video easily. Flip models cost anywhere from $100 to $299.

Cisco has been trying to turbocharge its consumer-focused business, especially in home networking, and the move is a clear step in that direction. It is better known for its business making hardware and software that powers the plumbing of the Web.

Although it used stock in buying Pure Digital, Cisco has a $29 billion pile of cash. Recently, I wrote a piece about how a lot of tech companies, with big hordes of money, will soon be buying up a lot of the most promising tech start-ups.

The first commercially-branded Flips were, in fact, introduced at the third D: All Things Digital conference in 2005 by CEO Jonathan Kaplan (pictured here at D3.)

In an email to BoomTown this morning, Kaplan was happy with the outcome, because no matter its success, taking Flip to the next level is not easy:

“We’re thrilled by the partnership. Cisco shares my vision for capturing and sharing simple, accessible, and high-quality video to the mass-market consumer. Now we can deliver that ideal on a global basis.”

Cisco said that “upon the close of the acquisition, the Pure Digital team will become part of Cisco’s Consumer Business Group, which includes Linksys® by Cisco® home networking, audio and media-storage products. Kaplan will become general manager of the combined organization,” reporting to Ned Hooper, SVP of Corporate Development and Consumer Groups.

He and his team will also get a $15 million in retention-based equity incentives.

The sale to Cisco is a big win financially overall. Pure Digital got another $40 million in additional funding in mid-2007, from investors Morgan Stanley Principal Investment, Heights Capital Management and AllianceBernstein, who joined initial investors Sequoia Capital and Benchmark Capital.

It had previously gotten $28 million in 2004 from Sequoia and Benchmark, as well as Crescendo Ventures, Steamboat Ventures and Focus Ventures. It was founded with $200,000 in seed funding in 2001.

And, more to the point, Flip cameras have been used by me for nefarious interviewing of scared Web execs since our site’s launch. In fact, I have been so bizarrely enamored with the Flip that I even did a video of my many old Flips meeting the new high-definition Mino last November.

Here is that Felliniesque effort:

And here’s the full press release from Cisco about the deal:

Cisco Announces Intent to Acquire Pure Digital Technologies, Makers of Flip VideoTM Networking Leader Adds Popular Flip Video Solutions to Consumer Portfolio Photos

SAN JOSE, Calif.–March. 19, 2009–Cisco today announced its intent to acquire privately held Pure Digital Technologies Inc. San Francisco-based Pure Digital, creator of the best-selling Flip VideoTM brand, is a pioneer in developing consumer-friendly video solutions with mass-market appeal.

“The acquisition of Pure Digital is key to Cisco’s strategy to expand our momentum in the media-enabled home and to capture the consumer market transition to visual networking,” said Ned Hooper, senior vice president of Cisco’s Corporate Development and Consumer Groups. “Pure Digital has revolutionized the way people capture and share video with Flip Video. This acquisition will take Cisco’s consumer business to the next level as the company develops new video capabilities and drives the next generation of entertainment and communication experiences.”

Pure Digital’s Flip Video has sold more than 2 million units and quickly demonstrated market appeal in the United States by making video simple, accessible and fun. All Flip Video products come equipped with FlipShare, a best-in-class software that allows users to easily organize and edit videos and then share them instantly on YouTube, MySpace and other popular sharing Web sites.

“Flip Video puts the power to instantly capture, edit and share video into the hands of everyday consumers,” said Jonathan Kaplan, chairman and CEO of Pure Digital. “By combining forces with Cisco, we join a company that shares our passion for video and whose global scale and tremendous technology expertise we expect will enable us to quickly expand and enrich the Flip Video experience.”

Upon the close of the acquisition, the Pure Digital team will become part of Cisco’s Consumer Business Group, which includes Linksys® by Cisco® home networking, audio and media-storage products. Kaplan will become general manager of the combined organization, reporting to Hooper.

The Pure Digital acquisition exemplifies Cisco’s “build, buy and partner” innovation strategy to move quickly into new markets and capture key market transitions. Under the terms of the agreement, Cisco will pay approximately $590 million in stock in exchange for all shares of Pure Digital. In addition, Cisco will provide up to $15 million in retention-based equity incentives for continuing employees. The acquisition is subject to various standard closing conditions and is expected to close in the fourth quarter of Cisco’s fiscal year 2009. The acquisition will be accounted for in accordance with generally accepted accounting principles.

This past weekend, BoomTown revved up the Mini and headed out in the pouring rain to a Peet’s Coffee in Fremont, Calif., to the exact spot where Demo Executive Producer Chris Shipley proposed that VentureBeat founder and Editor-in-Chief Matt Marshall take over the longtime, semiannual conference where several dozen start-ups strut their stuff in front of an industry crowd.

Shipley will still be running the show at Demo09 starting Sunday in Palm Desert, as well as the next Demo in the fall, with Marshall working alongside until he takes over fully in 2010.

(Shipley will remain on the advisory board, but will mostly be focusing on her consulting firm, Guidewire Group. She has run Demo for 13 years.)

Shipley and Marshall talked about it all in a video interview, as well as the fake controversy ginned up last year by champion ginner-upper TechCrunch–which, big surprise, runs a competing conference–about Demo’s longtime (and transparent) practice of charging a large fee to presenters.

“It was a false argument created as a marketing tool by a competitor,” said Shipley flatly.

What will be more pertinent and interesting in the Marshall era will be the integration between his VentureBeat Web site and the IDG-owned Demo conference, which could be a good way to take the conference and make it a year-round community of interest.

“We want to turn from a five-day affair into an ongoing conversation 365 days a year,” said Marshall, who also said the Demo model still works well. “It’s not that broken, so we will be tweaking it more than fixing it.”

Here’s the video of the pair chit-chatting about it all (sorry about the coffeeshop noise, but it was very festive):

Yesterday, TechCrunch’s U.K. blogger Mike Butcher spun the tale of buyer’s remorse run amok with a report that Time Warner online unit AOL was “seriously considering selling Bebo, the social network it acquired for $850 million only a year ago,” citing poor performance and a bad advertising market.

Later, AOL went on the record saying “there is no truth to this rumor,” although Butcher–in a third update to his piece–insisted otherwise from his sources.

In my favorite hedge ever, Butcher noted: “I’m not saying Bebo is formally on the block, but I am saying that a sale is something under consideration.”

Well, actually, no.

What is true, which Butcher did do an excellent job outlining, is that AOL most certainly overestimated the prospects for Bebo as an advertising and growth vehicle, hoping that Bebo’s interesting new media offerings–like its “KateModern” online series–combined with a social network, were the magic bullet.

It did not hurt that Bebo was then being sold to advertisers by its very deft top exec Joanna Shields, who is now head of AOL’s People Networks.

Thus, AOL woefully overpaid for it, especially if you look back from the current dire economic environment and also now realize that social-networking advertising is a little bit harder to get going than promised (a shock, I know).

No inside sources you talk to at AOL or Time Warner (TWX) will deny any of this today, and Time Warner CEO Jeff Bewkes has even said so publicly.

This was not exactly a secret then either. As I wrote right after the sale last March:

What’s AOL getting for its $850 million in cash to purchase social-networking site, Bebo?

A very attractive social-networking service and a very experienced exec who has been running it.

But, perhaps more importantly for those who focus on pesky numbers, not a whole lot of revenue and negligible profits, judging financial information I got a gander at, courtesy of sources at several companies that looked at funding or buying Bebo.

And the rest of the overall outlook for Bebo? A small but growing business, with nice user engagement with strong page views and minutes spent per session, but little traction beyond Britain and Ireland, and too small a presence in the critical U.S. market.

(Bebo is also strong in New Zealand, but BoomTown does not have to point out that that country is not exactly the kind of game-changer that AOL CEO Randy Falco mentioned in his email to the troops about the purchase.)”

And in another post I did at the time:

Thus, I am still trying to figure out why AOL–which was built on the pillars of community, communications and connectivity–has consistently not been able to leverage its still-valuable assets.

I suppose it is sexier to do a big, splashy deal, of course, which takes focus away–for a while at least–of the essential need to take hits, while doing the slow block-and-tackle work it will require to really build a strong ad and social network.

Buying Bebo, the third-ranked social network, for so much and trying to turbocharge it is a very lofty goal, of course, but the real problem with the acquisition is that it feels like an answer in search of a question.

While Bebo President Joanna Shields–who will enter the AOL exec team as part of the deal–and the Birches have clearly built a very interesting property, the weight of Falco’s calling it a “game-changer” on which AOL’s future rides could turn out to be much too much for Bebo to carry.

That is, especially with that heavy bag of Time Warner cash it is also shouldering.”

That’s why it takes about two seconds these days to uncover much residual anger within both AOL and Time Warner about the huge slug of cash that the company handed over to get Bebo, which mostly went to its quirky founders (who, many sources told BoomTown, thought they were underpaid!).

But, even so, that does not mean Time Warner is going to pull yet another stupid Internet trick–remember this was the company that sold itself to AOL for a song back in 2000, in what is now considered one of the worst merger deals ever–and sell Bebo for bupkis.

In fact, spending even more effort, it has been trying to use Bebo as the main vehicle to renovate all its communications assets, including its unsung AIM and ICQ instant messaging properties.

The center of the People Networks, run by Shields, Bebo is the third leg of the “new” AOL, as it has been recently touted, with its Platform-A ad unit and new niche content studio called MediaGlow as the other parts of the stool.

Will it all work? Will Time Warner change its mind? Will Shields give up? Will even the AOL brand continue?

“Who knows?” is the right answer, of course. With Facebook, MySpace, Yahoo (YHOO), Microsoft (MSFT) and Google (GOOG), as well as Twitter and FriendFeed, all vying to be the consumer’s dashboard to the Web, no one actually does.

And, if Time Warner is truly interested in selling off AOL whole, as it has been trying to do mightily, you might wonder if it would suddenly change course and dismember it now, causing even more confusion, when it is already facing so many other more pressing complications–all for a lousy price in the current weak economic landscape?

I called it “insane” when AOL bought Bebo for so much last year. I’d be dubious if it would get crazier still.

But if you want to see Shields in action–be careful, as she apparently so persuasive she could probably sell a big bailout to a Republican–take a look at this video I did a while back before the AOL acquisition:

How can BoomTown put it plainly?

The alleged deal being cooked up by a group of Silicon Valley investors to take a run at Yahoo using money raised from Microsoft, is little more than what we used to call a “trial balloon” when I worked at the Washington Post.

That did not stop Silicon Valley from jabbering about the latest plot twist all day, in which the TechCrunch report named no names, but carried an awful lot of water for someone looking to see the reaction to such an idea.

Because when you actually talk to sources at the wallet itself–that would be the money-laden Microsoft (MSFT)–they scoff at the notion that they would help others buy Yahoo (YHOO) in order to get at its search business.

“We can deal directly with Yahoo, which is moving through a process to get a new CEO, and when the time is right, we will deal with their leadership,” said a source close to Microsoft’s thinking. “Getting involved in some convoluted deal with others in control…it’s idiotic.”

Yahoo sources also called the idea–which has been floated numerous times to no result–silly. “I guess anyone can make a bid for the company,” said one source. “But actually doing it is another thing.”

So, here’s my official announcement that All Things Digital will be trying to buy Yahoo forthwith. Now, if I can only find that $18 billion, it is mine, all mine.

[UPDATE below.]

Yesterday, the one-man-band of a tech blogger, Michael Arrington, let loose with yet another outrageously indignant diatribe–this time that he and his TechCrunch site would forthwith break all news embargoes.

Not content with the traffic generated last week by his obviously faked Wrestlemania bout with French entrepreneur Loïc Le Meur about the lazy-lunching Europeans, he moved on to a more promising, but ultimately meaningless, riff on PR people versus journalists, over embargo-breaking.

It’s a sure-fire hit, given tech PR people and bloggers obsessively monitor Techmeme.

(What next for the Geraldo Rivera of investigative tech blogging? A withering prosecution of Yahoo CEO Jerry Yang in the HOV lane on Highway 101 in Sunnyvale without a hybrid? Quelle scandale!)

But BoomTown is not going to do a thumbsucker response to TechCrunch’s news embargo jihad, because, well, who really cares about the details of PR-media interaction anyway (except those who take themselves way too seriously)?

Here’s the essential 411 you’ll need to know: Some embargoes are good and some are bad and some are just–how can I phrase this correctly?–whatever.

And let’s be honest, pretty much everyone has broken an embargo, either by accident or on purpose.

But Arrington’s ire about this seems overwrought, and I suspect the true crankiness is natural product of the end cycle of dopey Web 2.0 “exclusives,” which TechCrunch has gotten in droves.

And all of it is increasingly less important as the economy withers and a lot of the less sustainable start-ups fade away. There are big important stories happening in tech right now about major public companies, the state of innovation and the future of the industry, which require more serious journalism.

So I think we can all imagine a day very soon when the Web 2.0 echo chamber dissipates–as it inevitably did in Web 1.0–and no one goes nuts if Start-up X adds a new embeddable widget, Start-up Y changes its homepage design or Start-up Z contemplates a new social-networking site for dogs to gain a new revenue stream.

And, in a less frothy landscape, the more important exclusives now go out to many. For example, consider yesterday’s story on LinkedIn’s changing of the guard, which went out to a dozen news outlets in advance rather than to just one like TechCrunch alone.

Of course, the true exclusives that a tech site gets through enterprise reporting take hard work and no handouts, which TechCrunch does legitimately get. Yesterday, in fact, TechCrunch’s Robin Wauters got a few really good ones about product units Yahoo is cutting.

But in this bruising contest, TechCrunch clearly does not dominate, based on its size, as it did with the easier press release exclusives. In the new environment, in fact, tiny little voices that are accurate and insightful have just as much impact.

So, my takeaway from Arrington’s rant could be boiled down to three words: “GIVE ME EXCLUSIVES!”

That verbal stamping of foot brought to my mind the loud declarations of Dr. Seuss’s “Yertle the Turtle.”

In the story, Yertle wants to be higher than anyone, so he forces the other turtles to pile up under him in an ever-unwieldy tower to rule over everyone and everything.

It ends badly, of course, when Yertle asks for too much:

But, as Yertle, the Turtle King, lifted his hand
And started to order and give the command,
That plain little turtle below in the stack,
That plain little turtle whose name was just Mack,
Decided he’d taken enough. And he had.
And that plain little lad got a bit mad.
And that plain little Mack did a plain little thing.
He burped!

And his burp shook the throne of the king!

And Yertle the Turtle, the king of the trees,
The king of the air and the birds and the bees,
The king of a house and a cow and a mule…
Well, that was the end of the Turtle King’s rule!
For Yertle, the King of all Sala-ma-Sond,
Fell off his high throne and fell Plunk! in the pond!
And today the great Yertle, that Marvelous he,
Is King of the Mud. That is all he can see.
And the turtles, of course…all the turtles are free
As turtles and, maybe, all creatures should be.”

We’re all in the mud now, TechCrunch. But come on in–the water’s just as fine.

[UPDATE: Now Arrington is going for the full cup full of crazy by attacking an admittedly obnoxious PR lady, getting all hot and bothered by spam she sends with the kind of indignation I like to reserve for the vile terrorists in Mumbai or wife beaters. Oh, dear. Then again, the rest of us can concentrate on real stories, while he busies himself huffing and puffing away on his anti-PR sousaphone.]

Only 24 hours to go in the DonorsChoose.org’s Blogger Challenge 2008 and I am now forced to bring in the big guns.

That would be the angrily arched eyebrows of Digital Daily’s John “Patches” Paczkowski, along some of the AllThingsD.com staff, begging mightily for your donations.

So far, I have used my kids, known to authorities as the Swisher boys, to deliver a threatening pitch about why you should give early and often to fund technology projects for high school students.

I have also danced with Yahoo CEO Jerry Yang in “High School Musical 3″ and forced him into a painful dinner (thanks, Jerry!).

DonorsChoose.org is a charity that funds classroom projects in high-need public schools, using the Web to match teacher project requests with donors.

So far, I have raised $8,414 from 26 donors, impacting 704 students. But am still No. 3 behind the my longtime frenemy venture capitalist Fred Wilson and TechCrunch.

Congrats to both, but this obviously cannot stand! There is one more day to give, so get giving!

You can click here to reach the giving page or use the widget on the lower right side of the ATD homepage or the left side of the main BoomTown page.

Here is our new begging-and-pleading video and also the other three I have employed to try to pry some dollars from the battered economy.

Patches Uses His Mesmerizing Eyebrows

The Swisher Boys Make Idle Threats

BoomTown and Yang Are Wildcats!

Awkward Dinner With Yahoo CEO Jerry Yang

As the economy continues its very drastic downward slide–part of a binge and purge cycle that is almost classic in its psychology–it is, of course, no surprise to see Web 2.0 finally wise up.

While the quarter-dropping-in-the-slot was a bit slow, I think no one now doubts the impact of the tech and Internet business, going forward, from large companies to small start-ups, and all the rest of the ecosystem that relies on the virtuous circle of digital life.

Much has been made here and all over the blogosphere about various prescriptions to hunker down by venture capitalists and plans by companies to cut costs in this downturn.

That includes the realization that, as one Web exec wrote me yesterday, “no more eyeballs=business.”

Of course, this change in tone is a good thing and much needed, given how frothy things had become in Silicon Valley over the last two years.

While the excess was by no means anything like the last bubble–where inane start-ups actually had the audacity to IPO and, thereby, essentially take cynical and sometimes criminal advantage of an ignorant investing public–the maxim of Web 2.0 that basics like revenues or positive cash flow do not matter compared to growth has been a dangerous one.

And though growth is key too, part of an investment and belief in the future of important trends like social networking and the ubiquity of online advertising, the go-go strategy had taken too much of the attention of entrepreneurs.

And while the crash is certainly not due to that focus, and tech is indeed getting unfairly hurt, given how healthy much of the sector is, Silicon Valley needed an attitude adjustment.

In other words, while the recent excess is not the culprit, its departure is a very good thing.

The problem is, that does not matter at all, given the situation and where it is headed.

And where is that?

Onward, of course, although maybe not upward for a while.

In what is a typical shift in the zeitgeist this past week, TechCrunch’s Michael Arrington penned an interesting rumination today about what he calls the “ignoble but much needed end to Web 2.0.”

Like me, he references the dopey lip-synching video made by a bunch of Web 2.0 folks while on a vacation, which will surely become a classic example of how profoundly out-of-touch and egregiously silly their mindset has become.

Arrington writes:

“Goodbye, Web 2.0. I hope I never have to type those words again. Now can we please get back to work? There’s still a ton left to do before we get to Matrix-style virtual reality, the Singularity, and mobile phones with batteries that last a whole day.”

Although it might feel like it, I think calling it an “end” is probably too dramatic for what is happening now.

But I would have to agree wholeheartedly that moving on to what really matters is perhaps the silver lining in this decidedly difficult time.

Back in the first season of “Saturday Night Live,” one running catchphrase uttered by Chevy Chase would always crack the then-12-year-old BoomTown right up: “This breaking news just in: Generalissimo Francisco Franco is still dead.”

It’s that same kind of extreme déjà vu I feel with the continuing drip-drip-drip of the news-less news that Time Warner’s AOL and Yahoo are still talking about a merger.

Both Silicon Alley Insider’s (and soon-to-be AllThingsD.com blogger) Peter Kafka and I wrote extensively about the talks on in mid-September, noting that the discussions centered around merging AOL’s content, advertising and software assets with Yahoo (minus the access business).

There were the price issues–Yahoo wanted to pay between $6 and $8 billion, while Time Warner has long wanted $10 billion–as well as the worries about integration (East Coasties versus West Coasties) and email dominance monopoly problems.

As I wrote on Sept. 23, for example:

That support will be especially important if Yahoo tries to buy AOL, which it is again strongly considering as a way to bolster its ad business, international portfolio and email and content offerings.

Several sources I have spoken to recently have said that Yahoo leadership is very interested in doing such a deal, although not at the $10 billion price tag that Time Warner wants. (Think half and add a little more.)

In addition, there are some daunting regulatory and integration issues–AOL and Yahoo email and messaging combo would be a giant in the space, and the HQs of the companies are on opposite coasts.

But, the deal would give Yahoo some more experienced executives it needs and make it more attractive to others who might not consider going to Yahoo in its present state.

Yang had been pinging a lot of execs over the last year and has had little uptake.

But a stronger and more flexible Yahoo–i.e., it knows it has to change dramatically–would surely be more enticing, especially in a down economy.”

Now comes yet another story yesterday from TechCrunch that the talks are–wait for it–still on.

The story recounted similar details and added even older ideas from previously reported AOL-Yahoo talks (some multi-billion-dollar cash infusion from Time Warner, for example).

And, said TechCrunch, it could happen this month!

Good gracious–October is, like, a really long month. And, if not October, I guess November is good or maybe December. Hey, what about 2009?

Actually, what everyone really would like to know is what the heck is taking Time Warner (TWX) and Yahoo (YHOO) so long, hashing over the same issues (price mostly), especially if it is such a stellar idea?

And, with the economy crashing all around and Yahoo’s and Time Warner’s stock hitting five-year lows, one has to wonder what, exactly, the pair are waiting for?

A more fortuitous reading of the entrails? A sign from the heavens? Better winds?

Well, I hate to inform Time Warner CEO Jeff Bewkes and Yahoo CEO Jerry Yang, but the tide is not turning anytime soon, and both their companies are getting weaker by the minute.

I once called the pairing of AOL and Yahoo a little like leaning two drunks against each other to keep them from toppling over.

Looking back, I will admit that was a little harsh.

Given the stakes now, though–and especially if Yahoo has to abandon its controversial search ad outsourcing deal with Google (GOOG)–it makes sense to combine forces.

In the online ad space, for example, Yahoo and AOL mostly complement each other. The same is true in email and communications tools. And, while Bebo is not the prize Time Warner touted it as, despite paying a king’s ransom for it, Yahoo has no social-networking property.

The only area of true overlap is in content. Here, based on many sources, I would imagine if a deal is ever struck that Yahoo will slash and burn most of AOL-branded properties, keeping only interesting newer brands like sports blog FanHouse, celeb blog TMZ and the Engadget, Tuaw and JoyStiq tech blogs.

And, in fact, if the pair even gets its act together–this or next week would be great for us–it will give them the much-needed impetus to start making the massive cuts needed at both Web outfits for a long time now.

In that regard, look for an AOL exec like its President Ron Grant to be buttonholed to swing that particular ax.

Yahoo, with its less confrontational culture, has never been good at that kind of thing. For all its many flaws, it is a talent AOL will surely bring to the party.

If, of course, Yahoo and AOL ever manage to throw one before they become too much like Generalissimo Franco.

You know: Still dead.