Google AdWords and Yahoo! Search Marketing (formerly Overture) face new competition from Microsoft's newly released PPC program, MSN AdCenter.

Currently, MSN still displays search ads from Yahoo! Search Marketing, through a contract that runs until July 2006, but the new technology from Microsoft is just a few steps away from being fully implemented. In the first phase, MSN AdCenter was put to the test in France and Singapore and it was launched to public access in Singapore on August 31 and in France on September 26. The results from the two pilot countries were very promising so, apparently, the paid search program will go into beta testing in the United States in October 2005.

Advertisers love the PPC system rather than others because it's cheaper and more targeted; they only pay when their ads get clicks. Until now the two major choices for PPC were Google Adwords and Yahoo! Search Marketing. However, when a third major competitor turns up, one can only hope that cost per click (CPC) gets cheaper, thus lowering the advertising costs.

As to what the new service features, the competition promises to be tough, especially in the research and targeting tools area. The advertisers are able to specify what kind of audience they wish to target by demographics - geographic location, gender, age group, lifestyle segment and time of day - and the system can provide keywords to be used in search campaigns. All these data can be accessed before the advertisers place their ads.

Even more, it seems that the Adcenter program will provide feedback related to keywords performance and advertisers will be able to switch to more effective ones during the ad campaigns. Eric Hadley, senior director of advertising and marketing for MSN, says the new platform is meant to help users drive ROI from a search campaign beyond just knowing if somebody clicked on it, but also knowing if someone is likely to click on it.

As for Google Adwords and Yahoo! Search Marketing, they both provide geographical targeting but they don't have demographics features. Meanwhile, the new AdCenter platform goes more towards customer profiling and behavior.

Search engine advertisers can't wait to see their keyword based campaigns become even more targeted. However, they'll have to wait a little bit longer, because there's no serious encouragement that the full-scale deployment of AdCenter will be possible before the end of this year.