This little story crossed the wires this morning. They were reporting on a Wall Street Journal piece:
The paper reported that the talks center on a deal that would fold Time Warner’s AOL Internet unit into Yahoo, according to the people, who still consider a Yahoo purchase by Microsoft as the most likely outcome.
I still expect MS to make it happen, it is hard to compete with the funding they can pull together, but this would be a nice evolution for AOL.
This is currently number two on Techmeme.