For 18 hours each week, Internet investor Jonathan Miller studies tai chi in New York with legendary master Ren Guang-Yi, whose devotees include Lou Reed, Bette Midler, Hugh Jackman and other celebrities.

During the sessions, Miller's lanky frame flows through fluid, continuous movements, punctuated by quick bursts of energy. Three decades of Chinese martial arts have made his limbs so supple that he can do the splits at 51. And the physical and mental discipline has sharpened his ability to quickly size up and react to situations while remaining calm even in the adrenaline-spiking pitch of combat.

Those skills also come in handy in the corporate setting. Miller has navigated some of the media world's most complex and difficult business challenges, including the attempted turnaround of AOL, Time Warner Inc.'s ailing digital unit. And they have earned him a spot on the short list for some of the Web industry's highest-profile job openings.

He is a prolific venture capitalist with Velocity Interactive Group, a digital media firm. But Microsoft Corp. has contacted him about replacing Kevin Johnson, who oversaw the software giant's online efforts and its bid to buy Yahoo Inc. And billionaire investor Carl Icahn added Miller to the list of board candidates being considered for Yahoo Inc., which is holding its annual shareholder meeting in San Jose today.

After much speculation that he would join Yahoo's board, two people familiar with the situation said Thursday that he might not. Miller and Yahoo declined to comment.

But, clearly, Miller has established himself as a hot hand on the Internet. He made his mark in e-commerce at Barry Diller's media conglomerate, then as chairman and chief executive of AOL, from which he was pushed out in November 2006. He has detractors, particularly inside Time Warner, but gets plaudits from analysts and colleagues who say he is one of the industry's foremost strategic thinkers.

Herb Scannell, CEO of Internet television start-up Next New Networks and former vice-chairman of MTV Networks, calls Miller "one of the smartest guys I have come across in the media world." Geoffrey Sands, who heads McKinsey & Co.'s media and entertainment practice, says Miller thinks several moves ahead of his competitors.

Miller's experience and connections bridge old and new media, arming him with unique and valuable insights, said Peter Chernin, president and chief operating officer of News Corp.

"By any measure, Jon is one of the most astute people about the Internet," Chernin said. "He has really good judgment and a deep intellectual understanding of the Internet. In a world of a lot of flash, he's a guy of real substance."

Soft-spoken and approachable, he has the gift of a Hollywood studio boss for handling big egos without becoming one, colleagues say. Diller, the media mogul, once described Miller as a "first-rate executive" who is "completely sweet and decent."

Jason Calacanis, who founded Weblogs Inc. and sold it to AOL in 2005, said Miller would be a top draft pick for any corporate team. "It's like landing Phil Jackson to coach the Lakers: People want to play for him and people want to play with him," Calacanis said.

Miller has weathered corporate storms. He took over AOL in 2002 during a period of dramatic upheaval. In more than four years there, he helped stabilize the Internet icon and remake it into an ad-driven business to better compete against Yahoo, and he oversaw a lucrative search advertising deal with Google Inc. that gave Google a 5% stake in AOL.

Time Warner replaced him in 2006 with NBC executive Randy Falco. AOL and Time Warner declined to comment this week, but at the time they signaled that they believed AOL needed someone with a stronger vision and more operations experience.

Some weren't so sure. Calacanis, who stayed on after selling Weblogs to AOL, quit in protest. On his blog, longtime AOL executive Ted Leonsis credited Miller with saving AOL from becoming a "case study in failure for business school classes" and creating "a new case study in courageous and visionary leadership."

Pali Research analyst Rich Greenfield said Miller took over AOL in the middle of a crisis and led an important transformation that is "still in process."

Miller grew up in New York and Boston, the son of a noted feminist psychologist and an economist. At Harvard, he majored in psychology and minored in film studies, holding down a job tending bar on the side.

After graduating with honors, he moonlighted as a bouncer at a rock 'n' roll club. A Celtics fan, he became an executive with the National Basketball Assn., focusing on television production and brand marketing. He later held senior positions at Viacom Inc., where he kick-started a British version of Nickelodeon, and with Diller's online division, now known as IAC/InterActiveCorp, where he developed innovative ways to combine the company's Internet, broadcast and cable units.

Miller first encountered Ross Levinsohn in the late 1980s when he was with the NBA and Levinsohn was at a sports agency. The two set a partnership in motion two decades later. Levinsohn left News Corp., where he was president of its Fox Interactive Media unit, two days after Miller left AOL. "His was the second phone call I received," Levinsohn said.

A week later, the two spent an afternoon discussing business and life over drinks at the Beverly Wilshire Hotel. They had bid for many of the same companies and each had negotiated big search deals with Google.

They quickly realized they also shared the same aspiration: to invest in emerging online trends. They formed Velocity and in December merged it with a Silicon Valley firm, ComVentures, which had $1.5 billion under management.

The venture capital game is more rough-and-tumble than it used to be. Fewer venture-backed start-ups are being bought by bigger companies and far fewer are going public. But the pair have developed a philosophy called "connected investing" in which they go after companies in online video, publishing and advertising that can help each other gain traction. In turn, they help start-ups with their connections to big media players.

Both Miller and Levinsohn are sought for their connections and expertise. When Microsoft was contemplating a proxy fight to gain control of Yahoo, it asked Levinsohn to join its slate of board candidates (Microsoft dropped the plan). For now, they both enjoy the challenge of investing in small Internet ventures.

"We have a similar ethos about where the Web is going," Levinsohn said.

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jessica.guynn@latimes.com