Yahoo ended its search for a new CEO with the naming of eBay Inc.’s PayPal president, to run the company. Following the tumultuous reign of former CEO Carol Bartz (News - Alert) which resulted in her highly public and contentious release in September, Yahoo has been run by its board and interim chief Tim Morse. 

Thompson, who has guided PayPal to be the growth engine of eBay (News - Alert) and a dominant player and innovator in global online payments (100 million plus active users, over 8 million global merchant partners and $4 billion in annual revenue), will be taking the Yahoo at helm at what promises to be a watershed period for the company.  

Questions are myriad as to how the company that was once the premium web portal can regain its mojo, internally as well as with customers and partners. It also needs to plant itself as a critical if not core part of an ecosystem — a “must be” in terms of success going forward — in a world where it does not provide compelling functionally like search, or the intimacy of social networking ala FaceBook and Google (News - Alert)+, or the lock-in to content of Apple and Amazon.

Described in various reports as a “real geek,” whether Thompson has the business chops to navigate Yahoo through choppy waters is going to be interesting to watch. The company needs cash to grow and as reported in the Wall Street Journal,  has already seen investment deals be shunned by disgruntled shareholders and is in the middle of a deal with its Asian partners Alibaba Group and SoftBank. 

Not surprisingly, Yahoo Chairman Roy Bostock is quoted as saying, “Scott brings to Yahoo a proven record of building on a solid foundation of existing assets and resources to reignite innovation and drive growth, precisely the formula we need at Yahoo."  At the opening bell this more the company is trading slightly down. We shall see how the market reacts throughout the day.

Thompson will join the board on January 9, and Morse will return to his job as CFO.