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Yahoo! Sharpens Research Edge

Michael Schwarz seems out of place in a crowd of hip, breezy Internet entrepreneurs gathered at a San Francisco bar as they celebrate the latest resurgence of all things Internet.

Brainy, contemplative and deliberate in his responses, the 36-year-old former Harvard economist stands in contrast to other revelers, many of whom owe their success more to an instinctive, gut-driven penchant for capitalizing on the next Internet trend than to any kind of reflection.

After all, the latest wave of Internet success stories -- video-sharing site YouTube, notorious for the oddball video uploads it carries, not to mention the $1.6 billion Google (GOOG - Get Report) shelled out for it in October ; college networking site Facebook.com; or news-voting site Digg.com -- seem more like flukes than deliberate science projects that could benefit from meditative types.

But Yahoo! (YHOO - Get Report), Schwarz's employer, is betting otherwise. The contributions of Schwarz and other researchers to the development of the Web may be larger than they appear, thanks to a push by the company.

The Internet giant is snapping up academics like Schwarz and arming them with reams of data it generates -- about 12 terabytes per day -- in the hope that it will be able to glean new, massively profitable insights into the way that users behave on the Web.
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