We’ve just learned that Scott Dietzen, VP Applications at Yahoo who worked on key products such as Yahoo! Mail, Messenger, Flickr, Answers, Groups, and Zimbra, has left the company. The surprising news comes on the same day the Sunnyvale company is announcing its not-too-bad yet not-excellent-either third quarter earnings.

Scott Dietzen joined Yahoo with the acquisition of open source email startup Zimbra, where he was President and CTO. Dietzen went on to replace Brad Garlinghouse, Yahoo’s former SVP of Communications & Communities, when he left the company in June 2008.

Yahoo announced third quarter earnings today, showing net income more than tripling to $186 million, or $0.13 a share, nearly double analysts estimates of $0.07 a share.

This was definitely a financial achievement for Yahoo CEO Carol Bartz, but it was done almost entirely through cost cutting. Total operating expenses of $775 million was pared down by $169 million from a year ago. In comparison, net income rose $130 million from a year ago.

What investors really want to see is revenues go up again. Unfortunately, Yahoo’s total revenue was down 12 percent from last year to $1.6 billion. And revenues minus traffic acquisition costs (the money Yahoo shares with advertising partners) declined 14 percent to $1.1 billion. On the bright side, revenue were flat with the second quarter by both measures. On the conference call, Yahoo is characterizing revenues as “stabilizing.”

My notes from the conference call Q&A after the jump.

As Microsoft and Yahoo await government approval of their pending deal to join their two search businesses at the hip, the two companies received an important endorsement today from the world’s top advertisers.

In a letter today from the American Association of Advertising Agencies, and signed by the CEOs of the Publicis Groupe, WPP, Interpublic, and Omnicom, the advertisers gave their full support to the deal, urging “the Department of Justice to bring its antitrust review to a speedy conclusion.” The letter notes that the deal would strengthen Microsoft’s and Yahoo’s search advertising offerings, and thus would be good for competition.

Earlier this month, a couple reports came out suggesting that Bing’s search market share took a hit in September. Hitwise reported that Bing’s share of U.S. searches was down 5 percent (in absolute terms, it was a half-point drop to 8.9 percent share). StatCounter marked an even steeper 12 percent decline (or a full 1.1 percent drop to 8.5 percent share). The headlines followed. But now comScore says all of that’s bunk.

Tonight it released its qSearch market share numbers, which are widely followed on Wall Street, and they show no decline for Bing in September. According to comScore, Bing’s U.S. search market share remained steady at 9.4 percent in September, up from 9.3 percent in August. That is not blowing the doors off of anything, but it is at least holding its own.

A class action lawsuit brought in 2006 by several Yahoo! pay-per-click search advertising customers has been settled, one of the parties involved who received an e-mail about the settlement informs us. In the e-mail, administrator Rust Consulting lets the concerned parties (”all persons that purchased, directly or indirectly, Yahoo! pay-per-click advertising in the U.S. marketplace”) know that the court has granted preliminary approval of the Settlement and has provisionally certified the Settlement Class.

The lawsuit (PDF) alleges that customers contracted for targeted ad placements through two products, “Sponsored Search” and “Content Match” (and predecessor products provided by Overture and GoTo.com) and that Yahoo! breached its contract with its customers by allowing Yahoo! ads to be displayed in spyware, domain name parking sites (bulk registration sites), pop-ups, pop-unders and typosquatting sites. According to the message, which is reproduced on a dedicated website about the case, plaintiffs brought claims for breach of contract, unjust enrichment, misrepresentation, civil conspiracy, and unfair business practices.

Do you like sounding like an idiot? Does the thought of doing so in front of millions of people appeal to you? Then Yahoo has just the thing for you (or, rather, Y!ou).

Yahoo has just launched Yodel Studio, a site for you to yes, record yourself yodeling. The idea is for Yahoo users to remix the service’s signature sound for a chance at recognition, most notably, on Yahoo’s homepage which is visited by tens of millions of people each month. Yahoo is also pledging up to $130,000 for local and global charities on behalf of each yodel submitted.

Twitter has produced a vibrant ecosystem of third party applications thanks to the release of its API. If you take a look at Twitter app store oneforty, there are thousands of applications and sites that are using Twitter’s various APIs to build useful and innovative applications. Which is why Yahoo Meme, Yahoo’s microblogging tool that hopes to compete against Twitter and Tumblr, is releasing its own API for third party developer use. The problem: Yahoo Meme doesn’t have many users.

Yahoo is offering Meme’s open API built on top of the YQL (Yahoo Query Language) platform. The API features compliance with OAuth for access to user data. Yahoo meme lets users post their own content (including text, photos, videos, links and more) and repost the content of others with one-click publishing, allows users to follow other Meme users (via one-way connections, no friend authorization is required) and comment on their posts. Meme’s content limits are higher than Twitter’s—the limit is 2,000 characters.

Yahoo is losing another executive today. Patrick Barry, who heads up Yahoo’s Connected TV group, sent out an email to staff this morning (reproduced below) informing them that he is leaving at the end of the month to “move on to new projects.” According to the email (below), he is briefing staff right now. (Josh Jacobs, head of ad technology platforms, is also leaving).

Through a series of deals with TV manufacturers like Samsung and Sony, the Connected TV product brings Web widgets from Yahoo to your TV. As such, it is a pretty central part of Yahoo’s strategy to connect consumers to the Web and the information that matters to them most.

Remember when Yahoo was nothing more than a directory of the best links on the Web as determined by human editors? The Web is too vast for any humans to keep track of, but what if you could combine the heavy lifting of computers with the smarts and expert knowledge of humans? Well, Yahoo now has a patent for that.

Yahoo today was awarded a U.S. patent for a “Method and apparatus for search ranking using human input and automated ranking”, which was originally filed more than 7 years ago. The patent, numbered 7,599,911, can be viewed on the USPTO website.

The patented method described in the documents calculates search rankings based on a combination of automated algorithms and human editor input. In the patent, Yahoo describes a way that previously-collected input from human editors can be mixed in (“blended”) with what its search algorithms return, essentially resulting in better search results.

India’s largest English-language newspaper, the Times of India, has an interesting print edition front page today – a huge yellow advertisement for Yahoo’s It’s You campaign first announced last month. You can view the print version here.

The newspaper’s circulation as of 2008 was 3.14 million, making it the largest selling English-language daily newspaper (here’s the whole list). Yahoo already has a large presence in India, reaching 26 million of the 35 million online Indians (according to Comscore, August 2009).

What does the ad mean? Who cares. It’s big and yellow. Yahoo has said it hopes to follow up on the ads by personalizing the Yahoo experience for each user.

Yahoo is killing support for a popular Gmail plug-in from Xoopit, a startup it acquired in July. An email was sent out today to Xoopit users on Gmail tited, “Xoopit for Gmail is closing. Here’s the info you’ll need.” It details different ways users can export their files, photos, videos, and other attachments which may be stored on the service.

Xoopit is a handy email plug-in that works with both Gmail and Yahoo Mail. In Gmail, it creates a strip across the top which shows you images of all recent attachments, making it possible to visually scan email for their contents instead of by subject lines. You can also click on the Xoopit thumbnail strip so that it takes over the whole screen with a grid of photos, images, videos, and docs.

LevelUp.com, a Spanish-language video gaming portal that caters to Mexican, Latin American, and US Hispanic markets, has landed a deal with Yahoo! Mexico to power its video game content channel. Update: The company says that it is powering a separate game channel called “Juegos”.

Our English speaking readers may not be familiar with LevelUp, but the site’s parent company Busca Corp is quite well established: it powers Playboy’s Mexican portal, the Spanish-language version of MSN’s Video Game section, and has a deal with Terra Networks. BuscaCorp’s top property is LevelUp, which the company says is Mexico’s top video game website. LevelUp recently broke into the Alexa 2000.

With the new Yahoo homepage that was previewed last July and is now rolling out more broadly as part of Yahoo’s new “It’s Y!ou” branding exercise, the main Yahoo homepage is taking on more of the personalization features on MyYahoo. There are all sorts of handy widgets in the left-hand column ranging from Facebook status updates to Gmail to any news feed (just type in a URL like Techcrunch.com and it will add the feed). When you hover over any of the widgets, a box opens up covering most of the homepage with information from that widget.

Today, Yahoo is making it possible to add applications made on the Yahoo Application Platform (YAP) to that sidebar as well. One of the first apps it is launching with is from personal finance tracker Mint, with its Budget by Mint widget. Other YAP apps launching today on the homepage include A-Z Wine Pairings from MyRecipes & Snooth, Books weRead by WeRead, Brain Trainer by Lumosity, a social version of the Flood-it game by LabPixies, kaChing’s virtual stock portfolio app, Movies by Flixster, and WordPRess QuickPress. YAP is part of Yahoo’s Open Strategy that it kicked off last year.

It appears that a few days ago there was a slight change to Flickr’s logo: an addition of a small Yahoo logo to the right side so it reads “Flickr from Yahoo.” In response, many Flickr users have taken to the photo-sharing site’s forums to express their horror at Yahoo’s branding on Flickr.

The underlying fact is that Flickr users, many of whom are techy hipsters, just don’t mix well with “middle America Yahoo” as Bartz put it a few days ago at the unveiling of Yahoo’s $100 million marketing campaign about “Y!ou.” Bartz said to a roomful of journalists and bloggers:

Yahoo Product Manager Michael McNeely leaves a cryptic Twitter message in response to my “Can We Please Have Jerry Back?” post earlier this evening that is critical of Yahoo leadership. He says “I wish I could fully respond to this…”

Me too! Do you agree with me, Mike, and are venting your frustration? Or are you aware of exciting new Yahoo product plans that will turn the tables on Google, Microsoft, Facebook, AOL, Twitter, etc.?

Last November we all knew Yahoo cofounder Jerry Yang would be stepping down after a disastrous tenure as CEO. He spurned Microsoft without realizing the consequences, and he had no ability to describe an alternate path for the company. We weren’t alone in calling for his dismissal, and the hope was that Yahoo would find the right leader to restore their former glory. They didn’t.

In the few months between Jerry’s resignation and the beginning of the Carol Bartz era at Yahoo, there was much speculation in Silicon Valley about who might lead the once great company. People I spoke with thought Yahoo would go one of two ways. The first would be to try to find the great product visionary to lead the company forward. Their Bill Gates or Steve Jobs (Mark Zuckerberg may someday be on that list). With the right product vision Yahoo could push boldly into new territory and renew its bid to create a lasting brand and company. The second way to go would be to hire someone to sell the company, whole or in parts, and maximize shareholder value in the short run.

It’s pretty clear Yahoo went with door number 2 and chose someone who could negotiate a deal over the next great product visionary of our time. You can’t really blame them – true visionaries are by definition rare. And it’s unlikely they’d want to go to swim upstream at Yahoo during the hard rebuilding years.

So in came Bartz, and the deals started happening. We’ve mostly kept quiet. Any new CEO deserves a honeymoon phase, and Bartz barked at journalists to keep their opinions to themselves on her first day at Yahoo: “It’s been too crazy. People outside Yahoo deciding what Yahoo should do, shouldn’t do. That’s got to stop.”

Yahoo unveiled a new branding campaign at a press conference in New York City, centered around personalization and connecting directly with consumers. The Web company’s new tagline is, “It’s Y!ou” (with the awkward Yahoo exclamation point in there). Yahoo wants to make the Web personal and it is emphasizing the various ways it does that through the Yahoo home page, search, and individual properties. The company will be spending “more than $100 million” on this new branding campaign, CEO Carol Bartz reveals.

Yahoo is so big that the only way it can speak directly to individuals is to make the message more about them than about Yahoo. Other slogans in the new campaign include “The Internet is under new management: Yours” and “The Internet has a new personality: Yours.” Just sticking the word “you” in an ad doesn’t make it any less generic, but Yahoo hopes to follow up on this promise by personalizing the Yahoo experience for each user. This extends to search, which rolled out a number of new features more broadly which were previously being tested (including SearchAssist, and enhanced results from SearchMonkey).

Every month since its launch, Microsoft’s Bing search engine keeps taking a little bit of market share. In August, Bing gained 0.4 percent to end the month with 9.3 percent of search query volumes in the U.S., according to comScore’s Qsearch estimates. Meanwhile, Google’s share came down 0.1 percent to 64.6 percent and Yahoo/s remained flat at 19.3 percent.

In other words, Bing showed the only significant gain, while everyone else stayed relatively flat. That $100 million marketing campaign must be working, or maybe it’s the improvements Bing is making to the search experience, or maybe it’s both. Whatever it is, it is translating into nearly a half-point market share gain every month for the past three months.

A video took the web by storm today entitled “Incredible, amazing, awesome Apple.” Basically, it boils down Apple’s latest event into a series of superlatives. It’s a funny video because Apple really does have a pattern of using these types of words over and over again in its demonstrations. Cynics will say this is how Apple brainwashes the masses into buying their products, and gets people jazzed about the tiniest features. But I think there’s something much deeper here.

While certainly there is some element of hearing something so many times that you start to believe it, that’s nothing new, any good salesman will do the same thing. But why I think the tactic works so well with Apple is because they actually believe what they’re saying. Just watch Steve Jobs in that video. It sure seems like he’s damn sure that what he’s talking about is amazing. He’s excited about it. So is Phil Schiller and the others on the Apple team. And that excitement translates on a level unseen.

Flickr has long had a way to note other users’ pictures that you think are worth saving. But the “Add To Faves” function is rather single serving, and not very social like the rest of Flickr. Today, the service is launching a new feature called “Galleries” to expand your interaction with others’ photos.

Basically, Galleries allow you to curate up to 18 photos from anywhere on Flickr into your own hand-made gallery. Previously, if you wanted to make a group of pictures surround something, you could only do it with your own. With Galleries, if you wanted to make a collection of the 18 best pictures taken at TechCrunch50, for example, you can easily do that, no matter who took the picture.