Much of the current rumors are spun from recent statements by Steve Ballmer, who mentioned not long ago that he would still be “interested” in a deal with Yahoo – not that such a deal was actually formulating. The suffering stock of Yahoo has led to a lot of internal turmoil, but apparently it's still not yet enough for the company to bail. Let's not forget Yahoo is still a profitable business.
Even if Yahoo did choose to find some form of exit out of the search business, they still have numerous other services at their disposal. Yahoo may be suffering, but they certainly aren't out of options.
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