• by Shankar Gupta , August 5, 2005

MSN will be launching a test version of its paid search product, "MSN Keywords," in October, in which it will invite 500 marketers to participate in the pilot program, a spokeswoman for the portal said Thursday.

MSN initially announced it was developing paid search in March this year, and currently is testing its platform in France and Singapore. With the launch of MSN Keywords, MSN will face off against market leaders Google and Yahoo!, as well as second-tier search engines like Ask Jeeves, in the struggle for search ad dollars. Yahoo! currently powers sponsored search listings on MSN, but its contract expires next June.

Josh Stylman, managing partner of search engine marketing firm Reprise Media, said MSN's entry into the paid search space will be a boon to advertisers, who will benefit not only from more choices in regard to where to put up keyword ads, but also from the increased innovation that competition brings.

"There's been a lot of innovation on the consumer side of search in the last couple of years. Google and Yahoo!, and to some extent MSN and Ask Jeeves, are in an old fashioned slugfest--every day they're outdoing one another," Stylman said. "There hasn't been that kind of innovation on the advertiser side. Adding MSN into the mix means more choices for advertisers."

The first of those innovations could be enhanced targeting, including by demographic and time of day, which MSN plans to offer in the final release.