By Jonathan Berr

Yahoo (YHOO) Interim Chief Executive Russ Levinsohn has decided that his company is in the advertising business.

The next thing you know, Christopher Columbus will discover America.

Though that sounds flippant, one of the Sunnyvale, Calif., company's problems is that it's an unfocused mess that tries to be all things to all people. No website being launched today would offer the array of services that Yahoo and AOL (AOL) offer, such as email, financial news and fantasy sports.

The Wall Street Journal recently noted that Levinsohn, a former News Corp (NWSA) executive, is trying to focus Yahoo, yet again, on advertising.

Be still my heart.

"In particular, Mr. Levinsohn aims to rev up ad sales on Yahoo's media websites by tying more ads to major events like the Super Bowl or Oscars and by adding more content to its sites to attract big advertisers," according to the newspaper. "… if successful, it could position the 49-year-old interim boss to take the company's reins permanently and put Yahoo's recent troubles in its rearview mirror."

That's a mighty big "if." For one thing, everyone from the smallest blog to gigantic sites such as Facebook (FB), Twitter and Walt Disney's (DIS) ESPN are trying to do exactly the same thing. Yahoo's sports and business websites already attract huge audiences. Attracting additional people for large events such as the Super Bowl and the Oscars will require Yahoo to steal users from other websites, which is hard to do even during the best of times.

Levinsohn's strategy has been tried before. Former CEO Terry Semel, an ex-Hollywood executive, tried to turn Yahoo into an online mecca for online news and entertainment, while at the same time trying to catch up to Google (GOOG) in search. He failed miserably, but not before realizing $450 million in gains from stock options Yahoo awarded him. Though he was vilified at the time, Semel was a genius compared with the incompetents (Jerry Yang, Carol Bartz and Scott Thompson) who preceded him. Shares of Yahoo are down more than 40% since Semel's ouster.

Another problem with Yahoo's "Back To The Future" strategy is the timing. When executives feel nervous about their economic futures, it is one of the first things that gets cut -- and that appears to be happening now. Experts have begun to cut their forecasts for global advertising spending growth and probably will continue to do so if the economy continues to falter.

Levinsohn wouldn't be my first choice to lead Yahoo. While at News Corp, he was one of the brains behind the disastrous MySpace acquisition, but he appears to be taking Yahoo in the direction Semel had envisioned. The recent content-sharing deal with CNBC offers low risks and decent potential for reward. Similar deals reportedly are in the works.

What Yahoo needs now more than anything is a CEO who can chart the company on a realistic course for future growth. That person might be Levinsohn, who the Journal says has told colleagues, "We have to strive for excellence, not for everything." But there is no guarantee the job will be his.

The Yahoo board, which is full of new members, is conducting a formal search and reportedly is holding deep discussions about what type of company it should be going forward. Many investors can't help but wonder whether Yahoo will once again snatch defeat from the jaws of victory.

As of this writing, Jonathan Berr did not hold a position in any of the aforementioned securities. Follow him on Twitter@jdberr.

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