REDMOND, Wash. — Micro soft has stepped up discussions with Yahoo about a partnership designed to challenge Google in the Internet-search market, people familiar with the matter said.
Qi Lu, president of Micro soft’s online-services unit, and Charles Songhurst, an executive who helps oversee acquisitions, are involved, said one of the people, who declined to be identified because the talks are private. The outcome of the negotiations is probably several weeks away, the person said.
Microsoft isn’t seriously considering an outright acquisition of Yahoo’s search unit, the person said. Instead, the companies are looking at proposals to work together to sell sponsored links next to Web searches and graphical-display ads such as banners and videos. It’s too early to say which approach the companies may adopt, the person said.
Yahoo and Microsoft together account for about 30 percent of the U.S. Internet-search market, compared with about 64 percent for Google, according to research firm ComScore Inc.
Microsoft will need to keep making capital and research investments in its search engine to compete with Google, chief executive Steve Ballmer said last month.
Ballmer and Yahoo CEO Carol Bartz met about three weeks ago to discuss the partnership, according to a person familiar with the situation.
Kim Rubey, a spokeswoman for Yahoo, declined to comment.
Simon Sproule, a spokesman for Microsoft, also declined to comment.
