Microsoft’s Online Ad Revenue Up Almost 20 Percent

Microsoft’s online ad revenue rose 19 percent in Q3 2010. Yesterday, the company reported that search ad sales on Bing propelled that growth.

Microsoft is banking on continued increase in search ad revenue through its partnership with Yahoo. “The Yahoo search partnership implementation is underway and we’re working toward U.S. completion by the end of this calendar year and global completion by early calendar year 2012,” said Peter Klein, Microsoft CFO, during yesterday’s call with investors.

“We continue to be enthused with Bing’s momentum,” said Klein, pointing to “10 consecutive months of share gains in the U.S.” for Bing. Yet, comScore reports that search share actually declined slightly between February and March.’s share dropped from 9.7 percent in February to 9.6 percent of U.S. searches in March, according to Hitwise. Google grabbed 70 percent of searches, and Yahoo 15 percent in March.

Microsoft also touted its cloud computing-based commercial online services during the call. This week the company launched a set of tools aimed at political and government clients. At an annual conference in Washington D.C. the company unveiled its Campaign Ready tool set. With the move, Microsoft put itself in closer competition with Google in the emerging political and government Web-based software arena. However, while the new Microsoft offering could help the company compete with Google on the political software front, it won’t necessarily help when it comes to an increasingly lucrative arena: online political advertising.

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