Gates matches Google's ad-targeting software

NEW YORK - Microsoft, owner of the No 3 internet search engine, is upgrading its software to let advertisers target ads to specific audiences by age and location.

The new adCenter product, which matches a similar service offered by search leader Google, was released in Singapore and France and is set for testing in the US next month.

The technology will put Microsoft in competition for ad dollars with Google and No 2 search engine Yahoo!

AdCenter will include features to help advertisers stay within budget by estimating how many people will click on spots and the monthly cost for search terms. The service will suggest search terms to advertisers and provide them with reports on the profile of web surfers who clicked on ads. Microsoft uses technology from Yahoo! to link ads to search results.

"Many things we do, we are out on our own; some areas we have great competition, like video games and now web search," Microsoft chairman Bill Gates said.

"Google is quite narrow compared with what we do."

About US$5.4 billion ($7.9 billion), or 42 per cent, of the total US$12.9 billion spent on online advertising in the US this year will be for search-linked ads, the largest segment of online market, says New York-based research firm EMarketer.

- BLOOMBERG