Well this was not the best news to me. I had really hoped if Microsoft and Yahoo joined forces a lot of good would come of it, especially in the online advertising market. As I said Yahoo’s Publisher Network and Microsoft’s AdCenter don’t even compare to Google Adsense, but if they were combined, there could at least have been some competition there. On Monday Yahoo’s Board of directors said that the 44.6 billion dollar offer substantially undervalues Yahoo. But does it really? As I said their Q4 earning has been down 23 percent and their stock has been going down since November.

By the end of the day Monday Microsoft had sent a response to Yahoo saying that a Microsoft-Yahoo combination would create a more effective company that would provide greater value and service to its customers. A lot of stories are coming up that Yahoo does not want to sell it all, and never did. Yahoo’s CEO Jerry Yang is said to have reassigned hundreds of employees 4 month ago, to make Yahoo more relevant. Some of the plans are to rethink Yahoo’s homepage, consolidate Yahoo’s social networks, open up Yahoo to third parties (like Facebook), and revamping Yahoo’s network infrastructure. It seems the Microsoft bid came at the wrong time as these things had not been achieved yet. But even if they are achieved well they make Yahoo worth the $40 a share (nearly $60 billion) they want?

It seems this week will be a crazy week for Yahoo. Layoffs have already started and from the looks of things it is not going good. Among the no-names let go there was someone you might have heard of. Yahoo has let go their VP of marketing for their search-ads business, Todd Daum. Also people are saying that instead of the normal 3 months severance pay they are only getting 2 months. No word of if this is true or not. If you are a Yahoo employee best of luck to you this week.