Microsoft looks beyond AOL

C|Net | at | by Mike

Time Warner has chosen Google as the most suitable partner for its America Online Internet unit--but the game isn't over for jilted suitor Microsoft.

The Redmond, Wash., software giant plans to leverage its desktop market dominance to compete with Google on search and advertising, analysts said Wednesday.

After spending much of this year wooing AOL in an attempt to get its search business, Microsoft lost out to Google. Google and AOL announced Tuesday that Google will invest $1 billion for a 5 percent stake in AOL under a broad partnership that expands their existing search engine deal to include collaboration on advertising, instant messaging and video.