Microsoft Corp. plans to introduce its own service for placing ads next to search engine results to further the competition between Microsoft, Yahoo! Inc, and Google Inc. The new service is called MSN adCenter.

Currently, Microsoft uses Yahoo! technology to deliver the search-based ads, but is expected to stop using the Yahoo! technology. The contract between Microsoft and Yahoo!, which share revenue generated by the ads, runs through June 2006.

Research firm eMarketer predicts search-related ads are expected to generate 41 percent of the$11.5 billion budgeted for online ads in 2005.

"Within the MSN adCenter platform, the new MSN paid-search solution will be tightly integrated with other future capabilities to give advertisers a one-stop shop from which to plan, execute and adjust their online campaigns," says Microsoft in a company statement.

"The new MSN paid-search solution will provide keyword buyers with in-depth audience intelligence including geographic location, gender, age group, lifestyle segment and time of day. As a result, advertisers should be able to plan more strategic advertising investments and achieve higher click-to-buy conversion rates among consumers," adds the company.

"Microsoft may not be the first in the space, but as history has taught us with the Redmond wonder firm, they are persistent and with 200 million in media dollars helping to build awareness and a strong history of miraculously well executed hype, MSN is really "entering" the space quietly," says iMedia Search Editor Kevin M. Ryan.