Yahoo! is in talks with News Corp. about merging itself with MySpace and the company’s other Web outlets, including IGN and Photobucket. That’s because Yahoo! rejected Microsoft’s bid a few days ago and it’s looking less likely than before that Microsoft will raise the price of its bid. The discussions between Yahoo! and News Corp. right now would result in something just shy of a full buy-out by News Corp.

This is just my own personal observation, but MySpace isn’t nearly as relevant as it was a few years ago, right? (Supplanted by Facebook, which I also get the feeling has plateaued.) So then what better thing to do than to merge one also-ran (Yahoo!) with something on the decline (MySpace)?

News Corp joins Yahoo battle [Financial Times]