Babylon - yes and no
Yahoo's revenue stream rides on the back of "content" more than search. Search is just a matter of aggregating information that is freely available, then crunching it with advanced algorythms. That is what makes Google so directly vulnerable. There is nothing they have in their business model, per se, that is proprietary, and the "content" they deliver can be grabbed for free by any competitor.
Yahoo on the other hand, draws its revs from a "higher level" content aggregation, and from a nascent but growing set of services.
It has only begun to monetize those, but I expect they will do so more and more over time. There are a TON of people who have various portfolios and watch lists housed there, and who use Yahoo as the quick and dirty first stop for financial info (especially now that they cut their deal with Multex), just to name one type of content.
Sure there will be much grumbling when Yahoo finally moves to charge people for all this free stuff, but I suspect a huge percentage will not leave, but choose to sign up and pay a very modest monthly, quarterly or annual service fee. I know I will.
While I love the many other avenues Google is exploring (like news.google.com, foogle.google.com, etc., etc.), it's not positioned the way Yahoo is.
Bottom line ... Google's going to come in and try to compete for some of Yahoo's "news content delivery" space, and Yahoo is preparing to re-launch Search and have a run at Google's hugely successfuly "paid search". And then there's Microsoft that wants to have a go at both of them. No one can know exactly who will win what piece of turf in that struggle, but one thing we can say with some certainty .... that competition will surely cut into margins.
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