BoomTown reported Monday in a major scoop that Yahoo’s (YHOO) Jerry Yang will indeed be stepping down as soon as the Yahoo board can find a suitable replacement. Digital Daily argued that it was perhaps the best thing Yang could have done for the troubled company. Early trading on Tuesday saw a 14 percent rise in stock price–an addition of nearly $2 billion to Yahoo’s market cap. Happy days didn’t last long, of course. All it took was a statement from Steve Ballmer reasserting Microsoft’s (MSFT) lack of desire to buy the company to send its share price plunging to $9.

Microsoft is allegedly coming close to settling on a new head for its digital business, not for lack of lost time, though–BoomTown predicts the winner will be Qi Lu, Yahoo’s former head of search. We’ll know soon, supposedly. In the meantime, Microsoft is busy trying to woo Verizon Wireless (VZ) away from Google (GOOG) as its default search partner on many of its devices. It’s willing to pay from $550-$650 million–twice as much as Google’s paying, allegedly–to own 60 percent of all searches made from mobile devices.

Digital Daily had more news of the continually declining economic situation (OK, econalypse). This week, the harbinger of doom was the precipitous fall in corporate IT spending, which will be, uh, about $0 over the next 90 days, according to Changewave. That just about lines up with the fact that online spending is at its lowest level in seven years. Meanwhile, concerns that current economic conditions will last much longer than previously expected prompted a tech selloff that kicked tech’s ass all the way back to 2003. Good times.

On a happier note, now everyone knows how to make serious cash from social media: Run for president. In the 21 months of his campaign, Barack Obama’s online machine raised half a billion dollars. Listening, Mark and Chad? How not to make money: Ask Axl Rose. In a pioneering move, the fabled Guns N’ Roses album, “Chinese Democracy,” launched on MySpace (NWS). Not so pioneering: Crappy sales. Of the tons of fans who tuned in, less than tons bought the album. In a nonsocial-networking move, YouTube will host its first-ever offline party in SF this weekend–Obama Girl, Fred Figglehorn and other viral phenoms will be in attendance. Don’t worry, BoomTown is going so you don’t have to.

MediaMemo followed the burgeoning saga of Mark Cuban’s battle with the SEC on charges on insider trading–more to come, no doubt. Motrin was also in the hot seat this week for its insensitivity toward women in its recent campaign aimed at, well, women.

Walt Mossberg gave Research in Motion’s (RIMM) BlackBerry Storm a comprehensive review on its launch date. For the smartphone’s details and a video of of its many features in action, check out Personal Technology. Covered in Mossberg’s Mailbox this week were some pros and cons of buying an e-reader, and details about the lack of FireWire as a stumbling block for buying a new MacBook (AAPL).

In The Mossberg Solution, Katherine Boehret takes a look at VideoSurf, a video search engine that searches videos by “seeing” the images that appear in them.

(Note about the placement of stock symbols: MySpace is owned by News Corp., which also owns this Web site, and the MacBook is an Apple product.)

Plus, said Schmidt, Google’s attention is best focused where the real money is, or will be soon: mobile advertising. “We can make more in mobile than desktop, eventually,” Schmidt said. “The reason is because the mobile device is more targeted. Think about it: You carry your phone with you everywhere. It knows all about you. We can use that to do a very, very targeted ad. Over time, Google will make more money from mobile advertising.”

“It is unconscionable that you have not allowed your shareholders to choose to accept an offer that represented a 72% premium over Yahoo’s closing price of $19.18 on the day before the initial Microsoft offer,” Icahn wrote in a letter to Yahoo’s leadership. “I and many of your shareholders strongly believe that a combination between Yahoo and Microsoft would form a dynamic company and more importantly would be a force strong enough to compete with Google on the Internet.”

So strongly, in fact, that Icahn–who owns 59 million Yahoo shares–has asked the Federal Trade Commission for permission to buy as much as $2.5 billion more of the company’s stock and has assembled a 10-member alternative board slate. Among the directors nominated, Icahn himself, his lieutenant Keith Meister, former Viacom Inc. (VIA) Chief Executive Frank J. Biondi Jr., and Dallas Mavericks owner Mark Cuban (Mark Cuban?!?).

And lest there be any doubt that Icahn was gunning for anything less than a referendum on Microsoft’s takeover offer, the financier concluded his letter with a parting word of advice: “I sincerely hope you heed the wishes of your shareholders and move expeditiously to negotiate a merger with Microsoft, thereby making a proxy fight unnecessary.”

What’s not yet clear is whether Microsoft is even willing to resume merger talks. Though it’s certainly possible that Microsoft CEO Steve Ballmer and Icahn have been having some back-channel chats about the issue recently …

Yahoo and Microsoft are both trading higher on the news.

“There is nothing ‘oh my god’ unique that has happened on the Net in forever. What we have seen are incremental applications that have been powered by the amazing ongoing drop in pricing of PCs, hard drives, memory and BACKBONE (not last mile) bandwidth. None of which are ‘the Internet.’ … It’s not the Net, it’s the applications, stupid! Falling costs to create, host and deliver digital bits enable entrepreneurs to be entrepreneurial. … It’s the brainpower that is changing our world. The Internet is just a utility to deliver the digital bits they create.”
–Mark Cuban

In July 2006, Mark Cuban, the billionaire Internet entrepreneur who sold Broadcast.com to Yahoo for $5.7 billion in stock back in 1999, declared the Internet “old news and boring.” And now, a little over a year later, he’s gone and pronounced it dead. Speaking at a cable telecommunications industry event earlier this week Cuban, who seems to have regained his wind after a recent and much publicized colonoscopy, said the Internet has become a dull bunch of infrastructure. “The Internet’s dead,” Cuban said. “It’s over. … The Internet’s for old people.”

Huh. So if the Internet’s for old people, where should the world’s next Mark Cuban focus his/her attentions? On the “intranet,” which Cuban describes as the on-demand and digital video-recording platforms managed by cable companies. “There’s less restriction on the intranet, it’s like your own corporate network for all the cable networks and even wireless,” Cuban told Advertising Age. “All [content] is moving to the TV. What’s the difference between a PC and a TV? Nothing.”