According to anonymous sources close to Microsoft and cited by "The Wall Street Journal," the software giant isn't considering a higher bid for Internet search portal Yahoo!. Instead, Microsoft is biding its time, convinced that Yahoo! will run out of viable options and realize that a merger is inevitable.

Microsoft offered approximately $44.6 billion for Yahoo! in February, a bid that Yahoo! claims "substantially undervalues" the worth of the company. At the time, that bid was worth about $31 a share, a significant premium over the price of Yahoo!'s stock. Today, thanks to fluctuating share prices, Microsoft's bid is worth about $29 a share, which is roughly equivalent to Yahoo!'s current share price.

Part of the psychology of the bidding process is that no alternative bids have emerged, so Microsoft sees no reason to raise its price, which would essentially see the company bidding against itself. Yahoo! has investigated a number of partnership and merger alternatives, but no viable options have emerged. A recent Yahoo! road show, aimed at getting investors excited about the future financial possibilities of the company, has fallen flat. Few believe that Yahoo! can independently improve its fortunes in the way the company describes.

Microsoft and Yahoo! have only formally met once since Microsoft's unsolicited offer. But the meeting centered on Microsoft's planned merger of Yahoo!'s business into its own online offerings, and not on financial terms. Yahoo!, thus far, has declined to meet with Microsoft to discuss finances.