Option investors bet heavily on Monday that Yahoo might strike a deal of some sort with Microsoft Corp, spurred on in part by pressure from activist shareholder Carl Icahn.

Microsoft has proposed an alternative deal for Yahoo, a complex transaction that would include just buying Yahoo's search business, rather than a full buyout, a person familiar with the discussions said on Monday.

One of the most surprising things about Microsoft's bid for Yahoo is that if successful it will make Microsoft one of the two or three largest users of open source software in the world. Google is certainly the largest. The National Security Agency may or may not be second (only the spooks know for sure), but if it is then by my estimate that would make Yahoo the third.

After several months of discussion and speculation, the Microsoft-Yahoo buyout deal is apparently off. At least, that's what both Microsoft and Yahoo announced over the weekend. There is some speculation that Microsoft CEO Steve Ballmer made his announcement in order to topple Yahoo's share price, in order to make another offer at a lower price.

How much are Yahoo's volunteers worth? And how much less will Yahoo be worth if Microsoft scares them away? That's the question that should be at the center of talk about Yahoo's value — both as an acquisition for Microsoft and as good company to work for with.

Google Inc. raised the specter of Microsoft Corp. using its proposed $42 billion acquisition of Yahoo Inc. to gain illegal control over the Internet, underscoring the online search leader's queasiness about its two biggest rivals teaming up.

Well, here I am just a few miles from Yahoo!' headquarters and Microsoft's Silicon Valley residence. It's Sunday, and I've yet to hear screams from either camp. So, it seems that Microsoft's call to action deadline around the Yahoo! buy is passing with a lack of fanfare.

Microsoft’s proposed $45 billion buy of Yahoo would give the Redmond, Wash company control over a top open source e-mail company, open source projects and an open source infrastructure. On September 17 of 2007, Yahoo bought Zimbra for $350 million. Yahoo’s infrastructure is built on BSD. Yahoo has released a myriad of software to the open source community and even sponsors some open source projects. So this deal would put Microsoft directly into the open source software business.

So Canonical will make money from Yahoo searches (really Microsoft now with Bing powering Yahoo search) to help fund their efforts.

Just a few hours after Yahoo! rejected Microsoft's $44.6bn purchase offer, the Redmond-based software giant has responded, reiterating that it "reserves the right to pursue all necessary steps to ensure that Yahoo!'s shareholders are provided with the opportunity to realize the value inherent in our proposal."