I think Yahoo's rejection is mostly a dog and pony show. What other options do they really have? If Microsoft can't get them at the price they want, they'll just do a hostile takeover. They really don't care about the bad press. Their reputation is already cutthroat enough.
Microsoft will not do a hostile takeover. If they do, then many of the big people over at Yahoo, might just leave the company. Microsoft will keep making bids until Yahoo accepts one of them.
Correct me if I'm wrong, but doesn't Microsoft already own part of Google? Microsoft will only resort to a hostile takeover if Yahoo doesn't yield. I hope that does not happen, however; Microsoft thinks they're all that and a bag of chips. They need to be taken down a notch or two. my 2 cents, for what it's worth.
The bottom line is this: Yahoo, even though they aren't making the money that they should, STILL knows more about making a site that people will actually visit than Microsoft. If you don't believe that, remember Ms. Dewey still floating in webspace somewhere (great idea, MS). Yahoo just need to concentrate on Web 2.0 and user-powered social ideas and platforms that people will be more drawn in to, instead of trying to be a information portal. They should have realized the potential of this approach with the success of Answers, but somehow, they've missed it. MSN and Yahoo are both website models that have played out..
I'm glad Yahoo didn't agree to Microsoft's bid. Just the thought that there would be no Yahoo, is unthinkable. I grew up with Yahoo, and I believe the Web should always be standing on 3 legs. Yahoo and MSN, will never lose their kingdoms to Google...provided they specialize in, and emphasize on what they do best.
A tripod is theoretically the most stable platform, that is if the 3 support are equal, problem is google's too long and yahoo is too short, I am worried if Yahoo does not take up Microsoft's offer they may lose out eventually.