SAN FRANCISCO (MarketWatch) -- Yahoo Inc. is now more likely to outsource its search advertising to Google Inc., according to a person familiar with the situation.

Yahoo (YHOO) moved closer to the deal with Google after initial tests of the system proved promising, the person said.

Yahoo had earlier announced that it was testing Google's (GOOG) online advertising technology on a limited basis, prompting more speculation that the beleaguered Web portal was seeking a deeper partnership with Google as a way to fend off Microsoft Corp.'s (MSFT) takeover bid.

Read more: marketwatch.com

Labels: advertising, microsoft, search, Yahoo