[Posted by Shar VanBoskirk]

This just in: Microsoft announced at its annual financial analyst meeting today that it has extended its existing relationship with Facebook.  Official MS release indicates "Microsoft will work with Facebook to bring its customers Live Search-powered web search and search ads by the end of the calendar year." 

I say to Microsoft, "Well done!"  For two years now, MS has had a capable search engine and paid search ad platform arguably better than either Google or Yahoo! because of its analytics capabilities (AdCenter can provide detailed demographic and behavioral breakdowns of who is searching for certain keyword terms, as well as the intent behind different keyword searches).  However, MS has a paltry share of the searching audience.  According to Forrester's new Consumer Technology Benchmark, just 2% of Gen Yers and 4% of all consumers ages 29+ use MSN exclusively compared to 28% for Google and 12% for Yahoo! in both demographics.

This deal allows Microsoft to extend its search presence outside of its own proprietary search results page...a smarter play than bribing them through its cashback program to patronize Live.com.