You may recall that last summer News Corp. and Yahoo were supposedly trying to make a deal in which News Corp. would sell MySpace to Yahoo and get a share of the Yahoo business. Talks are back on, according to Rupert. He called up a little while ago to see if I’m going to the next TMWRTW (Twenty Men Who Rule The World) meeting, which is being held in Hawaii next month. We were shooting the breeze when he mentioned that his guys have been holed up with Yahoo guys again. This time they’re proposing News Corp. gets 25% of Yahoo in exchange for MySpace. Not bad considering Yahoo is worth about $40 billion, which means old Rupe will have turned his $580 million purchase of MySpace into a $10 billion asset in just two years. Jerry Yang, meanwhile, gets to look like a man of action (ha ha) and finally gets a piece of the social networking business, which is where all the Internet traffic is going.

Rupert says business at MySpace is booming, couldn’t be better. But trust me, he knows damn well they’re about to get their head blown off by Facebook. Also worth noting: When crafty old Rupe decides that the time is right to start selling things, you know we’re hitting the top on the current bubble. Just saying. Watch out for falling debris. (Photo courtesy of Ian Mangina, US Weekly.)