David and Tom Gardner recently interviewed Yahoo! CEO Terry Semel on The Motley Fool Radio Show on NPR. This is the second of four parts.

TMF: Terry, let's talk about Yahoo!'s(Nasdaq: YHOO) competition. You are the CEO. You are in the strategy meetings. Intermediate term, whose name comes up more in those meetings? Microsoft(Nasdaq: MSFT) or Google?

Semel: Well, we really don't look at Microsoft as a competitor. We look more as MSN, perhaps, to be a competitor to us as a portal. And MSN does a terrific job so there are the three traditional portals, if you will, with AOL (NYSE: AOL) included. We are all competitors, but then again each of the companies is doing a good job. Some days they will do a little bit better at certain things, and other days we will.

Google is kind of out there on its own. They were the search provider to a large degree. Search two years ago was a business that was not monetized, so there was no way to get paid through all of the research. I think everyone became more and more reliant on their technology.

We are using search technology from a company that is a text-based company. So almost everything they do and do very well, I might add, are text-based things. We are a company that also has deep verticals, whether it is sports or music or finance or you name it. In those deep verticals we have all sorts of content that includes text base, but also has video streaming, also has chat, also has user-driven reviews.

How could we be using, in effect, algorithmic search? How could we be using technology that is designed for a company that doesn't look like ours? Why aren't we, in effect, creating our own technology that we could even share with other companies who look more like Yahoo!? We have opportunities to interest people in more than one form of information.

TMF: Over the last two years, have you ever thought of buying Google?

Semel: Obviously at the very beginning, Yahoo! was not only probably the largest customer of Google. I think Yahoo! in turn owns a piece of Google. So, sure, when I first came I thought it was a cool idea. To the credit of the founders, they always thought back in those days that they were not interested in being bought. They wanted to run their own company and in those days they said they were not interested in being a public company. So I guess that opinion might have changed.

TMF: Terry, you mentioned earlier that you came from a different industry; 24 years at Warner Brothers. You certainly deserve credit for turning Yahoo! around. How about two or three short lessons from the Semel Guide on Leadership?

Semel: Just be who you are. I have never changed who I am. That means I ultimately have to follow my own mind, my own path. I listen a lot. I love to listen. I love to be surrounded by really smart people with great ideas. At the end of the day, I don't ever want to be in a position where I made a decision because I didn't trust my own instincts. So I trust my own instincts. My personality is what it is. I am not a yeller and screamer. If anything, probably boring. I listen to people and I love to be around people so I am not going to change who I am or how I make decisions.

TMF: Prospective shareholders might like to know, Terry, what percentage of your overall net worth is in Yahoo! stock?

Semel: Well, they might like to know that, but they are not going to find that out today. I have a great opportunity to do well if Yahoo! shareholders do well. When I came here, that was clearly not my first motivation. It was not about how much money do I make, because at the very beginning my approach was nothing would be just fine. I see this as an enormous opportunity and I want to take a go at it. So I did it for the challenge, and I did it because I thought it could actually work.

TMF: What was your first job, going back, back in the day?

Semel: While I was still in college, I worked for an accounting firm because I was getting a degree in financing. My very first job I guess was as a waiter in a hotel, which is how I paid my way through college.

Tomorrow: Semel's smartest and dumbest business decisions, and 7-Eleven pantyhose.

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