Yahoo has appointed former Knight Ridder Digital Head Hilary Schneider as Senior Vice President of Marketplaces, a newly formed unit including Autos, Classifieds, HotJobs, Personals, Real Estate, Shopping & Auctions, Travel and Yellow Pages. Schneider’s arrival means that Yahoo Local GM Paul Levine, who oversees Maps, Yellow Pages, city guide and classifieds (as well as Real Estate), will now have two people to report to: Schneider and Sr. VP Jeff Weiner.

Schneider proved herself to be a hard charging-yet-creative executive at Knight Ridder, where she would have eventually competed for the top spot as CEO — had the company survived (and before that, at Red Herring and The Baltimore Sun). I can speculate that her decision to go with Yahoo was an easy one on a personal level, since its location in Sunnyvale, next to San Jose, is close to her previous job and didn’t mean uprooting her family.

But the establishment of a new business unit to make room for Schneider, who is charged with creating an “overarching strategy for classifieds and listings,” might prove a little messy in execution. Potentially, it does away with the lines separating Yahoo Local, Yahoo Auto, Yahoo Real Estate, and other verticals. These units, of course, are about more than generic “listings ,” as they’ve fully integrated Yahoo’s extensive toolsets (maps, photos, reviews, RSS, news).

On the other hand, as a Yahoo exec pointed out to me, it potentially makes way for more integration for Local with travel, real estate and the other services. What is emphasized is that Local will continue to be an important part of Yahoo’s search strategy, as well as its emerging listings strategy. Me, I think Local continues to makes sense as a unique category, and that Yahoo does it well, even with the category overlaps.

Note: This post originally appeared on my blog, Local Onliner. My bio can be viewed here. Additional comments on this post can be viewed here.