The technology industry's titans came out to play yesterday, offering a tantalising glimpse into the innermost workings of the companies shaping Silicon Valley – and the internet services of the future.

At one of the web's most important annual conferences, the chief executives of Yahoo!, Amazon and Facebook, whose services collectively are used by hundreds of millions of people the world over, brainstormed the future of their companies and the technology industry at large.

There was no big announcement to rival Microsoft's the previous day about the next version of Windows, but the D: All Things Digital conference in California was rich with snippets about the future of the web.

Here are some of the highlights:

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Yahoo!/Microsoft

Jerry Yang, the besieged chief executive of Yahoo!, which has rebuffed Microsoft's $47.5 billion bid to buy the internet portal, said that while a full merger now appeared unlikely, a potential deal with the software giant would still have "tremendous power".

Mr Yang, who reportedly played a round of golf with Microsoft's chief executive, Steve Ballmer, this week, said that Microsoft was "no longer interested" in buying Yahoo!, but that the two companies were "talking about other things". He declined to be drawn further.

Last week, it was reported that Microsoft had proposed an alternative deal where it would buy Yahoo!'s search business, and take a minority stake in what remained of the portal after it had sold its Asian assets, including a stake in China's largest e-commerce group, Alibaba.

In an interview with Walt Mossberg, of The Wall Street Journal, Mr Yang also said that an alternative deal it had been pursuing with Google, its rival, also "made sense," though no agreement had been reached.

Yahoo! has been trialling an arrangement where it allows Google to place the advertisements alongside search queries conducted by Yahoo!'s users - a market in which Google is the undisputed leader - freeing Yahoo!'s advertising might to focus on the market for "display" or banner ads, in which it has traditionally performed better.

Mr Yang told the conference that he was "the best person to lead Yahoo!", but acknowledged the company still had "a lot of work to do" and investments to make to realise its vision of becoming a "must buy" site for advertisers on the internet.

Amazon

Just one in 20 people is electing to buy an electronic version of a book rather than a hard copy, Amazon, the online retailer, revealed - six months after the release of its much-touted "e-reader", the Kindle.

Jeff Bezos, the chief executive of Amazon, told delegates that e-book accounted for just 6 per cent of overall sales of titles where two versions - a hard copy and an electronic version - were available.

The Kindle, which was released in November and costs $399, allows owners to download the complete text of a book in a minute via a wi-fi connection. It uses a technology called electronic ink, which fills the screen with tiny black and white particles to resemble the appearance of paper.

Mr Bezos said Amazon's goal was "not to displace people's love of the physical book," The Wall Street Journal reported, but to offer the ability to download any book at short notice.

He added that he saw e-books as having the potential to become a significant part of Amazon's business, and that the company had even considered adding certain "intangibles" to the product - such as the smell of a book's binding - to make the experience more realistic.

Asked whether the device prevented users from making copies of a book once they had downloaded it, Mr Bezos said that as a general rule software designed to prevent copying - known as 'digital rights management' (DRM) - did not slow down sales.

The Kindle gave publishers the option to manage copyright in their books however they chose, but the device's deafult setting was DRM-free, he said.

Facebook

Mark Zuckerberg, the 23-year-old chief executive of Facebook, defended his decision to stay on as head of the social networking site, saying he was "not done" executing his vision for the company.

Mr Zuckerberg recently recruited Sheryl Sandberg, a former senior executive at Google, to be chief operating officer - but has declined to appoint a more experienced manager to replace him as chief executive.

Other technology pioneers who have founded successful internet companies, including Larry Page and Sergey Brin, who set up Google, have handed the reins to a more experienced manager when they have begun expanding on a large scale, as Facebook is now attempting to.

Interviewed on stage alongside Mr Zuckerberg, Ms Sandberg reportedly said that Facebook had the potential to help companies speed up the process by which their brands became known by consumers by providing information that users found useful - a reference to the site's 'news feed' that updates users about the activities of their friends.

Mr Zuckerberg reiterated that he had no plans to sell Facebook to Microsoft, which acquired a $240 million stake in the site last year, or to list the company. His goal, he said, was to deliver his vision of a site which helped its users "share information and share their personalities."

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