Microsoft to bring ads to Bing AI search

Microsoft is bringing advertisements to its new artificial intelligence-powered Bing search engine. “First, we want to drive more traffic to publishers in this new world of search. It is a top goal for us, and we measure success in part by how much traffic we are sending from the new Bing/Edge,” Microsoft’s corporate vice president Yusuf Mehdi said.

Microsoft said it has already met more than 7,500 Microsoft Start partner brands to get feedback on how to distribute content to drive traffic and revenue. Microsoft Start is a service that offers personalised news from Microsoft’s premium partner publishers.

The company said in the blog that it wants to drive more traffic to the publishers and work towards increasing revenue to publishers. Towards this, Microsoft is introducing an expanded hover experience where hovering over a link from a publisher will display more links from the same publisher. 

Additionally, for Microsoft Start partners, Microsoft will offer licensed content next to the chat answer to drive more user engagement with the content. The ad revenue will be shared with the partner. Microsoft will start testing placing the ads in the chat and share ad revenue with partners whose content contributed to the chat answer.

Debargya Das, the founder engineer of AI-based knowledge discovery company Glean posted a tweet with a screenshot of the ad displayed on Bing chat.

Bing Chat now has Ads!

It's going to be fascinating to see how the unit economics of Ads in language models will unfold and affect search advertising.

1/3 pic.twitter.com/o5YjRjikOP

— Deedy (@debarghya_das) March 29, 2023

To be sure, Reuters reported last month that Microsoft showed a demo of the new Bing and spoke about its plans to allow paid links within the responses to the search query with one of the leading ad agencies. 

In terms of ad revenue, Google holds a dominant position, holding over 90% of the market share. In an interview with Insider last year, Microsoft Ads chief Rob Wilk spoke about growing the company's ad business to $20 billion per year.