Yahoo and Microsoft back in talks over ad deal

Microsoft, who ended its hostile bid for Yahoo almost one year ago, has started up discussions again with the company, this time over a possible advertising pact.Yahoo's new CEO Carol Bartz has met with Microsoft CEO Stee Ballmer this week, says sources, with both sides still hesitant to set any agreement in stone. One possible deal would have Microsoft selling search ads for Yahoo while Yahoo sells display ads on all Microsoft properties in exchange.Microsoft has been very aggressive in expanding their search engine (Live.com) and is expected to introduce another major overhaul this summer.A large scale partnership would go a long way towards creating a strong competitor to Google in search, which currently has 81.39% market share, according to Net Applications.