News Corp could be offering Jerry Yang a deal where they would trade MySpace in exchange for a stake in Yahoo.

Rumor: MySpace Swap For Yahoo Stake

Way back in the early 20th Century, legendary bluesman Robert Johnson made a deal with the Devil at a crossroads. The story said Johnson traded his soul for the ability to play guitar better than anyone.

New Yahoo CEO Yang may be at a crossroads only a couple of days into his duties, with Rupert Murdoch playing the role of Ol’ Scratch. The Devil wants 25 percent of Yahoo, in exchange for the social networking website MySpace.

The Times of London thinks the negotiations could be in jeopardy, now that Terry Semel has been deposed from the CEO post at Yahoo. News Corp could throw in other goodies like its gaming network IGN to sweeten the deal.

Another social networking site’s success seems to play a role in this deal. In the report, the Times noted how Murdoch acknowledged to the Wall Street Journal that Facebook, a one-time Yahoo takeover target, has been on the rise.

Yahoo could make a belated entry into social networking, and an opportunity to throw out Google’s ads and search, by taking News Corp up on its MySpace offer. Yang and company just have to decide if it’s worth part of Yahoo’s soul to do so.