The troubles (well, troubles other than their steady decline over the years) started last Wednesday when MySpace announced they were cutting half of their staff.
Obviously that move signaled that the MySpace ship was sinking, and the very next day News Corp, who owns the site, hinted at what everyone had already assumed: They are looking to sell off MySpace.
So although the first social networking giant tried to upgrade itself back in October, it doesn't seem like their efforts paid off. The site has been hemorrhaging money and News Corp apparently can't justify keeping it anymore.
Now, this doesn't technically mean MySpace will go away, because whoever buys it could decide to try to revive it. But if MySpace's ROI (or lack thereof) is any indication, we could very well be seeing the last days of Facebook's forefather.