When you're sitting pretty at No. 1, some of the worries, challenges, and focuses that the underdogs worry about fall away.  Such is Google… currently.  While they watch from the lofty perch of numero uno, Yahoo and Microsoft, Nos. 2 & 3, struggle to find ways to bring that perch a little closer to Earth.  I'm sure they'd love to actually push Google off the perch and listen in glee as the search giant crashes back down to the ground.

A lot of speculation is circulating about how that will happen, who will do it, and when it's going to happen.  Some say Yahoo is going to pull a miraculous recovery and reclaim it's top search spot.  Others say Google will continue to rein for as long as information needs to be indexed.  And Jeremy Schoemaker of Shoe Money thinks that Microsoft is going to buy Yahoo next year.  Schoemaker, in a post titled 10 Reasons Why Microsoft Will Acquire Yahoo in 2007, details the reasoning behind his prediction.

I don't think it will ever happen.  Coincidentally, I have a 10-point list of my own reasoning:

10 Reasons Why Microsoft Will Never Buy Yahoo

1. First and foremost, Microsoft is way to proud to say they can't win on their own.  Come on… this is Microsoft we're talking about.  A purchase of Yahoo might help them out, but it would also signal defeat.  Microsoft doesn't do that, even when the federal government steps in.
2. They don't need Yahoo Publisher Network.  Microsoft adCenter is much better than YPN already.  They might not have the search volume yet, but they've already got the infrastructure in place if/when that traffic arrives.
3. Microsoft has the money to buy Yahoo.  But I don't expect them to spend that money on a dinosaur like Yahoo.  I think they'd be much more likely to buy a smaller, smarter company that they can bring into the public's eye as a "Microsoft product".  Too many people already know that Yahoo exists in it's present form.  Microsoft would be better off buying a great company that no one has heard of so that when it gets big (with Microsoft's help), it will have been a Microsoft product from day one… in the eyes of the consumers.
4. I agree that Microsoft needs users, bad.  And yes, Yahoo has millions of users that might look good to Microsoft.  But look at the other players.  They all need users, they all need eyes, and they'd all probably love to get a stab at Yahoo's business.  Is it worth enough to Microsoft to fight all of the other companies out there for Yahoo?  I don't think it is.
5. If a bidding war actually did break out, I'd expect eBay to buy Yahoo first.  Their growth is stagnating and a purchase like Yahoo would give them a big injection of new opportunity.  I'm willing to bet they're interested in becoming more of an "internet company" than just an auction site.
6. Let's say Microsoft was interested in a Yahoo purchase.  I seriously doubt the FTC would allow it.  Microsoft doesn't always have the best rapport with the government, especially when it comes to acquisitions in crowded markets that Microsoft is publicly voicing the desire to dominate.
7. Microsoft wins by copying what other companies are doing.  They try to make improvements and repackage things with that Microsoft touch, but it's basically copying.  Why spend the money to buy something as big as Yahoo when they could just keep working on their copy?
8. Yahoo doesn't "get it".  I think some of the people at Microsoft do.  All Microsoft needs is time.  With Vista and IE7 they have a second chance and if that fails, they have IE8, 9, 10, etc.  Eventually they'll figure it out and win.  It's the Microsoft way.  IE1 - IE3 didn't do much to shake up Netscape and it might have looked then that Microsoft was fighting a losing battle.  Then *BOOM*… here comes IE4… and the face of the internet changed forever.  Ask Netscape.
9. I see the Xbox helping Microsoft in the long term across all of its brands.  While there are quite a few grown adults addicted to their Xboxes, gaming systems are primarily marketed toward younger segments of the population.  Xbox Live is a big part of that.  People tend to stick with what they know and what they're used to.  If folks are using a Microsoft Xbox today, chances are they're going to use more Microsoft products in the future.  The same thing is happening to Apple because of the iPod.  If the iPod hadn't been such a huge success, Apple would have had much fewer new users today than it does.  We'll just called it Xbox Halo Effect (pun intended).
10. I can see a lot of other interested parties that would be far more likely to buy Yahoo than Microsoft.  Berkshire Hathaway, The NY Times, Fox News Corp, IAC/InterActiveCorp to name a few out of a dozen or more.  IAC/InterActiveCorp has a great product with Ask.com.  If they could put their technology to use with Yahoo's millions of users they might stand a chance to take on Google.  But Microsoft?  No.  I don't think so.

I agree that it's only a matter of time before Yahoo is acquired by another company.  In fact, I wouldn't be the least bit surprised if it happened inside of a year.  But Microsoft is no more likely to buy Yahoo than I am.  Bottom line:  it would be bad business for Microsoft.  And while they've had their fair share of bad business moves, I don't think Microsoft is stupid enough to make one of this scale.