Yahoo has begun discussions with News Corporation to explore alternatives to Microsoft’s buyout offer, people familiar with the talks said on Wednesday.

The preliminary discussions stem from an approach Yahoo’s bankers made to News Corporation last week as part of Yahoo’s effort to find a “white knight” and avoid a hostile takeover by Microsoft.

The talks, which were described by both sides as a “long shot,” center on merging Fox’s interactive assets  led by the social networking site MySpace  with Yahoo. News Corporation is participating in the talks, in part, because, as one participant said, “there’s nothing to lose.” Either News Corporation clinches a deal, or more likely, its interest pushes up the price of Yahoo for its competitor, Microsoft. The Microsoft bid, a mix of cash and stock, is now worth $42.1 billion.

News Corporation had sought a similar merger with Yahoo last year, people involved in the talks said, but Yahoo rebuffed its overture before News Corporation ever made a formal bid. At the time, News Corporation had teamed up with Providence Equity Partners, a private equity firm that focuses on media companies. The latest round of discussions are unlikely to include Providence, these people said, though it remains possible.