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Yahoo Wants a MySpace Account

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After activist shareholders pushed Terry Semel out of Yahoo last week, his successor Jerry Yang needs to raise the floundering search engine’s advertising revenue quickly or re-don his jester cap as Chief Yahoo. Social networking is the obvious answer and after a potential Yahoo-Facebook deal fell apart earlier this year, Rupert Murdoch is the man to see. The Times of London, a News Corp. holding, reported yesterday that Murdoch and Semel had been in talks to trade MySpace for a 25% ($10-12bn) stake in Yahoo.
It is more than likely that Yang will pursue this deal with the leading social networker, even at Murdoch’s inflated price. Rupe paid $580mn for MySpace two years ago, but after Facebook’s financer said he wouldn’t sell for less than $8bn, a $10bn MySpace shouldn’t be anathema to Yahoo. If Yang balks at the Murdoch proposal, it may go down with Semel’s infamous missed opportunity to buy Google and will probably mean an interim-only CEO appointment.
With the news, Yahoo traded up 1.6% to $28.08 and News Corp. was up 1% to $23.92.
Yahoo! For MySpace? [Forbes]
The social network bubble [Valleywag]