Google, AOL Extend Search Pact

Google and AOL have agreed to remain search partners for the next five years.

The two companies today confirmed a five-year renewal of their search ad partnership, which began in 2002. Google will continue to power AOL’s natural and paid search results, with the two firms sharing the associated ad revenue.

Plus, as part of the new pact, AOL has agreed to distribute its content on YouTube, Google’s massively popular video venue. In addition, Google will now power search on AOL’s mobile properties.

AOL CEO Tim Armstrong, who previously ran ad sales at Google, touted the deal in a statement as a victory for the troubled Web portal. “AOL users will be getting a better search and search ads experience from the best search company in the world: Google.”

While the deal would seem to provide AOL with some needed stability, the Google search renewal is a blow to Microsoft, which many expected to go hard after AOL’s search business as it attempts to build its Bing brand and strengthen its adCenter ad platform.

Though AOL’s search share has been shrinking over the years (it handled just 2.3 percent of U.S. searches in July, per comScore), its audience is considered loyal, perhaps less search savvy and thus attractive to advertisers for its potential willingness to click on search ads.