MSN to rival Google

MSN to split in two

Microsoft has announced its intention to split MSN into two units, in advance of its entry into the search arena.

The company is preparing to launch a new search engine next year and has decided to divide MSN into two distinct units to assist with this. The two new divisions will focus on 'information' and 'communications'.

The information unit will manage the MSN portal, e-commerce and media services, and of course the forthcoming search tools it is likely to introduce in the first half of next year. This unit will be headed up by MSN's current chief, Yousuf Mehdi.

MSN, through this Yahoo like information division, is also looking at online music initiatives, which will be co-ordinated by Mehdi. The company's advertising unit, which generates $1bn in revenues per year, will be integrated into this information division.

Meanwhile, the second unit, focusing on communications, will harness MSN's Hotmail, Passport and instant messenger products, as well as its DSL services. Blake Irving, a VP at MSN, is to take charge of this unit.

MSN recently broke even and believes that these changes will strengthen its push into profitability. MSN UK was not immediately available for comment.