Saturday afternoon at 4pm, Steve Ballmer pulled the plug on the opportunity to walk away with Yahoo. This decision came after talks Saturday morning between both parties.

So what happened? Couple of things. Microsoft was getting pressure not to impose itself on Yahoo in fear its stock would plummet and it would spend too much time rebuilding its image. And Jerry Yang, co-founder and CEO of Yahoo refused to take a price lower than $37/share. Yang knew all along Microsoft would never up its offer that much, and he certainly wasn't going to give it in to Microsoft so easily.

Next Steps: It's going to be interesting to see what happens. Yahoo's stock at this moment of my writing is down 20%. It's going to be tough to bounce back because Yahoo hasn't announced a clear plan or other sustainable buyer. Those of you who own Yahoo stock hopefully bought low so you won't see an immediate loss. My suspicion at this point is that Microsoft waits until Yang comes crawling back, or at least waits a couple of months to see what happens. Overall I think the deal is inevitable, but it ill take some time to let the dust settle and then Microsoft will either lower it's initial bid offer or come back with the same dollar value.