Microsoft may have failed in its pursuit of Yahoo, but is adamantly looking into other ways of expanding its share of the lucrative online search business. In some rather big news for Live search, which has been lagging behind both Yahoo and Google for some time now, Microsoft has announced that it will be integrating its web search services into Facebook by the end of the year.

The deal will extend an existing partnership between the two companies. Microsoft, which owns a small stake in Facebook, already has an exclusive agreement to sell banner ads on the popular social network. Under the new arrangement, more than 29 million people who actively use Facebook in the United States will see prominent displays of Microsoft's Live Search box on their friends' and their own Facebook pages.

Financial details are not known, but a similar deal between Google and MySpace sees the search giant raking in around $900 million as part of a three-year pact to serve search and display ads on the social networking site.