The Financial Times has an article with a quote from Yahoo's CEO, Terry Semel, saying "My impartial advice to Microsoft is that you have no chance." Ouch! Semel continues by stating that "the search business has been formed," in response to rumors that Yahoo and Microsoft were to partner or merge. Semel did say that he did discuss with Microsoft the possibility of Microsoft "co-owning some" of Yahoo's search. But Semel said that it would not be a wise move to sell "your right arm while keeping your left." Microsoft just does not seem to be getting much love these days. Jeff Javis also has some blogging of his talk here.
Postscript: The New Yorker posted the video of the interview here, I am listening to it now and towards the end, is the quote. You have to listen to the way he said it, it is very cool. "My impartial advice to Microsoft is that you have no chance," said the CEO of Yahoo, Terry Semel.