It's time to stop imagining a world where Microsoft and Yahoo married. Instead, it's time to start thinking about a world where Yahoo and Google are in a serious relationship.

More than five months after it first made an offer to buy Yahoo, Microsoft has officially ended negotiations to buy the company outright, according to the Wall Street Journal. No deal was reached to acquire the search firm for $33 per share as it had previously offered, or for any other amount.

Both firms confirmed the news, but offered slightly different statements. Yahoo said that the talks have concluded. Microsoft said it won't re-bid for the company as a whole, but it left the door open for an "alternative transaction" with Yahoo.

Yahoo also announced it reached a deal with Google to display some ads sold by its bigger rival on Yahoo sites in a deal it expects will generate $800 million in annual revenue. The deal could face regulatory scrutiny.

The Google deal also left the door open for Yahoo to be acquired. Either party can end the arrangement in the event of a change of control and Yahoo agreed to pay a termination fee if it gets bought in the next two years.

The news will come as a blow to financier Carl Icahn, who bought millions of shares of Yahoo in order to try and force a sale to Microsoft. An advertising deal with Google, he said, would be welcomed secondarily to a Microsoft merger.

Yahoo shares tumbled more than 10 percent on the news.

Of course, Henry Blodget at Silicon Alley Insider wonders if this drop means that Icahn is already dumping his shares.  It could also mean the deal with Google is not meaningful.