Source: CNN -- Read Full Story

Yahoo on Wednesday moved another chess piece in its bid to fend off a hostile takeover by Microsoft, announcing it will outsource advertising space to Google as part of a short-term deal that could lead to a bigger partnership. As part of a two-week trial, Google-generated ads will appear next to some U.S. search results on Yahoo (YHOO, Fortune 500). The experiment raises the possibility that Google could run Yahoo's search advertising service. Yahoo's move - clearly an attempt to show its unwanted suitor that it has other options - was quickly met with resistance. Microsoft general counsel Brad Smith suggested that a formal Yahoo-Google alliance would be anticompetitive, and a powerful Congressman warned that he would be watching the two-week test "closely."