Microsoft Corp. and Yahoo Inc. are in talks over a deal where the companies would sell advertising for each other, The Wall Street Journal reported Friday on its Web site, citing sources close to the matter.
Informal discussions between the companies escalated into a meeting between Yahoo Chief Executive Carol Bartz and Microsoft CEO Steve Ballmer last week.
Expectation that the two technology giants would enter negotiations over Yahoo's search business has been rising since Yahoo's new CEO, Carol Bartz, took over from Jerry Yang, the company's founder in January.
Yang had previously rejected Microsoft's offer to buy all of Yahoo last year for $47.5 billion, which made relations tense between the two companies.
The Journal said these latest talks, described as preliminary, aren’t about any sort of acquisition, but that Bartz and Microsoft boss Steve Ballmer have met in person to discuss a possible ad deal.
Last year another online ad-sharing deal between Yahoo and Google feel through after antitrust regulators started looking into it with scrutiny.