Microsoft reportedly to offer search cash

Microsoft plans to announce an effort to grow its shrinking Internet search share today by paying people to use its Live Search engine, according to a report Tuesday afternoon on SearchEngineWatch, an industry news Web site.

A Microsoft spokeswoman had no comment on the report.

Kevin Johnson, president of Microsoft's Platforms and Services Division, which includes its online efforts, said in an e-mail made public Sunday that Microsoft "will be announcing a major new initiative that our search teams have been driving."

According to SearchEngineWatch, the company is launching Microsoft Live Search Cash Back, which, in partnership with eBay unit PayPal, will pay consumers who search for and buy products online using its search engine.

The announcement will come during a presentation to advertisers at the advance08 event in Redmond by Satya Nadella, senior vice president in charge of engineering for Live Search, MSN and advertising platforms, SearchEngineWatch said.

Microsoft has struggled to gain market share for its Internet search engine. In March, it had 9.4 percent of the U.S. search market, compared with runaway leader Google's 59.8 percent. Microsoft is pursuing a deal with Yahoo that reportedly would include purchase of its Internet search business, which has 21.3 percent of the U.S. market.

According to SearchEngineWatch, the pay-for-search offer is based on technology from Jellyfish, a company Microsoft bought last fall.

Jellyfish, based in Middleton, Wis., offers a search tool that links to products from Target, Barnes & Noble and other stores. Shoppers who make a purchase through the service receive a portion of the advertising revenue Jellyfish receives from the retailer in the form of a credit.

"The technology has some interesting potential applications as we continue to invest heavily in shopping and commerce as a key component" of Internet searches, Microsoft said at the time of the acquisition.

The company has been trying to differentiate its search engine through improved features in specific categories such as images, news, shopping and health. It has also made strides in improving the relevance of its search results, but has struggled to get people to switch from Google.

This is not the first time Microsoft has tried to lure people to its search engine with lucre. In 2006, the company ran a three-month promotion giving away $1 million in prizes to people who tried the engine.

Benjamin J. Romano: 206-464-2149 or bromano@seattletimes.com