When Rupert Murdoch spoke about MySpace revenue last week at the Web 2.0 Summit in San Francisco, he sparked some blog confusion over whether he was dimming expectations for the world’s largest social network site as it comes under pressure from newer rival Facebook.

Some Murdoch watchers were not clear on whether he was talking about MySpace proper or its parent within News Corp, namely Fox Interactive Media (FIM). We can’t blame them. Even the most veteran media reporters say that Mr. Murdoch’s delivery can occasionally require them extra time to decipher his comments.

We reported that night that he signaled a retreat from previous forecasts, which were clearly pegged at over $800 million in annual MySpace revenue during an August earnings conference call. We also said that the tenor of his comments were repeated at a News Corp shareholder meeting on Friday with less bullish comments on FIM revenue. News Corp shares fell 5 percent following his remarks.

The tug of war continued over the weekend when Silicon Alley Insider  blogger Peter Kafka and Sanford C. Bernstein analyst Michael Nathanson jousted over the meaning and consequences of Murdoch’s statements. Silicon Alley Insider had flagged some summertime weakness in revenue at FIM in a September post. In a research note late on Friday, Nathanson compared the blog treatment of MySpace to the effort to discredit John Kerry’s war record by the Swift Boat Veterans group in 2004:

Nathanson: Whether these reports about MySpace are true or not, we will have to wait and see. Similar types of “reports” last week about Yahoo ultimately proved to be erroneous after its quarterly results came out. This is the new world. It makes our job as equity analysts and investors more difficult and will likely drive increased stock volatility, particularly in the very short-term. It will also make the truth more valuable than ever.

In the name of transparency, here’s the quotes we pulled from our recording of the Web 2.0 conversation between Murdoch and organizer John Battelle (bear with us on the laughs and silverware-rustling from the crowd):

John Battelle: You’ve been quoted as saying the revenues (for MySpace) are going to cross $1 billion in the next year? 

Rupert Murdoch: Well I said that, but that was for FIM rather than (MySpace)
But this is, you know, the bigger part of FIM. I think Peter Chernin said $800 (million). I might say $750 (million) but it’s a lot … it’s at least 30 times what it was the day we bought it two years ago. If we keep that trajectory going like that we’ll be very happy.