Interesting times, especially given Google’s tone when the deal was originally announced.
[…] after four months of review, including discussions of various possible changes to the agreement, it's clear that government regulators and some advertisers continue to have concerns about the agreement. Pressing ahead risked not only a protracted legal battle but also damage to relationships with valued partners. That wouldn't have been in the long-term interests of Google or our users, so we have decided to end the agreement.
Looks like Yahoo! needs to press the strategy recalc button again. I suspect we’ll see renewed speculation about MSFT + YHOO next.