Shares in Yahoo, the internet portal, were marked down more than 5 per cent yesterday morning after it emerged that AT&T was trying to renegotiate a five-year-old agreement under which the US telecoms giant has sold its broadband DSL service under the joint AT&T Yahoo brand name.

The negotiations between the two companies reflect the realities of a shifting power balance, not only between the two companies, but also between telecommunications groups and the internet portals that dominated early attempts to commercialise the worldwide web.

"From 2001 to 2004, the companies that had the clout online were the Yahoos of the world," said Scott Kessler, an analyst at Standard & Poor's. "Now [ telecoms] companies have millions of broadband subscribers. Frankly, they need to rely considerably less on Yahoo to acquire customers."

Since the partnership was announced in 2001, AT&T has been strengthened by a series of acquisitions, including the purchase of BellSouth for $68 billion (€51.9 billion) in 2006, while Yahoo has stumbled amid concerns it is losing ground to its arch-rival Google in the lucrative market for internet search.

Underscoring the shift in the balance of power between the two partners, AT&T is believed to have considered buying Yahoo, whose share price has been under pressure for some time.

Yahoo's stock price, which fell about 40 per cent last year, had bounced back in recent months following better-than-expected fourth-quarter results and the apparently successful launch of along-awaited search advertising overhaul. But Yahoo's shares fell 5.3 per cent by midday yesterday in New York, wiping out nearly $8 billion in market value.

Both AT&T and Yahoo declined to comment on their future plans yesterday, saying only that they "frequently collaborate" on their existing partnership.