After Yahoo's response to the Microsoft board earlier in the day, Microsoft has now responded back to Yahoo, re-iterating its committment to the original offer of $31. You can catch the press release over on Yahoo Business, ironically its not up on Microsoft PressPass yet it's up on PressPass now. The last and most interesting paragraph is below:

"The Yahoo! response does not change our belief in the strategic and financial merits of our proposal. As we have said previously, Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo!'s shareholders are provided with the opportunity to realize the value inherent in our proposal. "

It looks like the ball is back in Microsoft's court now. The obvious two paths ahead are for Microsoft to offer a higher price or to start going hostile and try to get a new Yahoo! board of directors in play who will accept the offer. Expect to see a lot more analysis over the next few days as the various options on how this plays out are discussed.