Google (NASDAQ:GOOG) to buy Apple (NASDAQ:AAPL)? There are rumors and then there are RUMORS. This one fits in the latter category, with a bullet.

The rumor apparently started with a New York magazine biography of Steve Jobs, penned by John Heilemann, in which he quotes an anonymous friend of Jobs as saying "I think that Google is going to buy Apple. It would be a victory for Apple; they'd get major-league partners, money, and engineers. And it would be a victory for Steve -- a huge win that lets him leave the stage."

According to this anonymous source, Jobs' recent health issues would be the driving force behind this sale. Heilemann also suggests that Apple's corner on the music download business has seen its peak, as it and others jump into the DRM-free market, and as wide-ranging internet access makes the idea of buying tunes obsolete.

Therefore, the iPhone, he concludes, is crucial to Apple's continued success. Depending so heavily on the success of a single product would make any company nervous, and perhaps thereby interested in bringing on partners to share the risk.

Apple currently has a market cap of $105.13 billion, Google $158.88 billion, so such a deal would be beyond huge. However, I question why Google would want to take on a hardware company, unless they intend to declare an all-out war with Microsoft.

I think this is more fantasy than rumor, frankly. However, it's great grist for summer poolside conversation.