Search Enginuity

In an attempt to explore alternatives to the Microsoft deal and/or entice MS to increase their offer, the Wall Street Journal is reporting that Yahoo will run a small test of Google ads on their site.

From the WSJ:

” Yahoo Inc. said it will carry search advertising from Google Inc. as part of a test effort that could lead to a broader partnership and boost Yahoo’s leverage in its ongoing takeover standoff with Microsoft Corp.

The test will last up to two weeks and involve no more than 3% of Yahoo’s Web search queries, the Sunnyvale, Calif., Internet company said. It is designed for Google and Yahoo to evaluate the revenue potential of a broader search ad sales outsourcing arrangement, according to people familiar with the matter. They have been discussing such an arrangement as part of Yahoo’s pursuit of alternatives to Microsoft’s unsolicited acquisition offer. Yahoo views the latest test partly as a way to demonstrate its belief that it is worth more than Microsoft has offered, one of the people says.”

Google, Yahoo, and Microsoft have all commented on the news.

More coverage and analysis:

• Techcrunch: Yahoo Provokes Microsoft With Google Adsense For Search Trial
• Search Engine Land: Confirmed: Yahoo To Test Google Ads
• Mashable: Yahoo Close To Search Advertising Deal With Google
• AP: Microsoft’s Official Comment