Well. This is really nothing new I'm afraid.
The beacons on Yahoo only track what you do inside the yahoo domains (like geocities) It do not track what you do on other pages unless these pages places a yahoo beacon on their pages. A web beacon is often just a one pixel transparent gif image which makes your browser get this picture, and as it does, the server with this picture knows which site you're on, and by looking at your full log they can see all your movements in the yahoo network. If you later watch an other site like CNN, they probably do not have a yahoo beacon, and thus, it is impossible for yahoo to know that you've been there.
But there are two things you should be aware of:
1. There are some huge advertising companies around which have ads on other's pages. When for example you visit anynewpaper.com they could have an ad which actually makes your browser get that image/flash from the advetisers server. When you later visit anycarcompany.com they happens to have an advertise on their page with the ad on the advertisers server aswell. Then the advertising company knows you have been both anynewspaper.com and anycarcompany.com, but they may not know you've been at thirddomain.com which you also visitied but did not have an ad from this company. En axample of such a company is http://www.fastclick.net/
The way to avoid being tracked is turning off cookies in the browser. If this is a problem, you can block external advetisers by turning off cookies from other domains than the one you're visiting. Browsers like mozilla can do this.
2. When you get an e-mail in outlook or other html-enabled reader, the e-mail reader can be instructed by the mail to fetch a picture at a server. When it does, the company that sent you this mail knows that you read the mail, and when you read the mail (and if they uses update functiions in html, they could get how much time you used on this e-mail). This is just another reason why html in mails is a bad thing for the world.
- Make you're e-mail reader to not show HTML in mails. If you can't, get another e-mail reader as such programs is often a security risk anyway and encourage spammers to see who is reading their spam, and then marks your address as active in their lists. Using Outlook (and especially one without a security update) is probably the most dangerous thing you can do to your computer :-)
- Turn off cookies if you can, and if you can't due to pages that needs them (like this fourm) turn off cookies from other domains if your browser supports it. (If not I would change to firefox or Opera - Explorer is a nice browser to use, but not safe).
Read more about the security problems of Explorer here
I run firefox with these settings on, and with the Adblock plugin installed, I have a quite ad free life :-)