Forcing all employees to work in the office says their managers do not have the skill to manage a remote work force. Whether that is true or not is beside the point; that's the message it sends. Technology now makes working from home, or the local coffee shop, as easy as working from a remote office. Whether the employees are as productive working from those locations is a management judgment that requires corrective action if they are not. If the reason for Yahoo!'s new policy is that most, or almost all, of their remote employees are not as productive as office-based workers, a better management action might be to replace those workers, and the managers who are not capable of getting the required production from them, rather than revoking a policy (telecommuting) that has substantial benefits for the company.
As the article Management By Attendance points out "People management styles change over time as we improve our understanding of human motivation and continually seek to maximize the performance of our organizations. Using a management style that was popular decades ago and expecting maximum results is silly. Instead, learn from those old styles, but adopt the newer, proven techniques like telecommuting.