Yahoo! said its plans at the moment will see it partnering with an existing internet player, using the power of its brand to attract more users.
Mark Opzoomer, managing director of Yahoo! Europe, said: "It's an area we are interested in expanding into outside the U.S."
Opzoomer, who was speaking to Reuters, did not give details of which markets Yahoo! is entering, but the UK market will likely be near the top of the list.
Towards the end of last year, Yahoo! returned to television advertising in the UK for the first time in several years with a campaign for its personal finance offering created by Euro RSCG Wnek Gosper.
The ads followed an overhaul of the UK & Ireland homepage in October, which cost an estimated £5m, which was Yahoo! UK's first revamp in more than two years.
In the UK, Yahoo! would face stiff competition from the likes of Freeserve, AOL, MSN, Tiscali and BT. It is likely that Yahoo! would partner with an existing player, possibly a telecoms firm -- in the US it has a partnership with cable firm SBC -- although BT is ruled out because of its extensive links with Microsoft.
The change of direction in the UK follows moves in the US to turn the business around. The moves have put broadband and internet access, as well as subscription services, at the core of this revamp strategy.
According to reports, there are some suggestions that Yahoo! would avoid entering the narrowband dial-up market and opt to jump straight into the newer broadband market.
News of the ISP move follows Yahoo! reporting a fourth-quarter net profit of $46.2m on revenues of $285.8m. Non-US revenues were $43.4m.
Opzoomer said that he expected Yahoo! Europe to generate a full-year profit before interest, tax, depreciation and amortisation in 2003 as subscription services were introduced.
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