Overture extends HP deal

Overture Services on Thursday said it extended its marketing agreement to tie its commercial Web search results to Hewlett-Packard computers for another year.

The agreement offers Overture a button on HP Pavilion and Compaq Presario notebook and desktop PC keyboards. HP users who press the "Search the Internet" button can access Overture's paid search results.

Overture and HP will also extend their marketing agreement to Canadian PC buyers. It had been effective just in the United States.

The marketing agreement is one of many distribution relationships struck by Overture. The company has been fueling other Web properties by paying partners a percentage of revenue generated by people clicking on its results. Overture auctions off placement for search keywords and charges advertisers a fee every time someone clicks on the advertiser's link.

This business model has become the latest cash cow for Web companies. Overture's biggest partners--Yahoo and MSN--have benefited from their deals by showing revenue growth and profitability.

Yahoo took a big step further on Monday by announcing that it plans to acquire Overture for $1.63 billion in a deal that will redefine the boundaries of power for the remaining Web giants. The deal also threw the ball into Microsoft's court, raising questions about whether MSN will be forced to partner with search giant Google despite growing evidence that Redmond plans to compete against it.