This agreement replaces the former deal Viacom had with DoubleClick system to deliver ads across Viacom's extensive range of US websites.

This new partnership will widely benefit Microsoft, which paid $6.5bn (£3.2bn) to buy aQuantative and the Atlas ad serving system, in an effort to compete with Google's push into online display ads by attempting the takeover of DoubleClick.

Both Microsoft and Viacom will advertise for each others' main activities. For instance, the MTV Music Awards will be co-promoted with Microsoft, while such brands as Comedy Central and Paramount Pictures, owned by Viacom could be used to advertise MSN and Xbox 360.

Not only has Google lost an important contract, but it also suffers from a fractious relationship with Viacom. The entertainment company is currently engaged in a $1bn (£502m) lawsuit over content copyright infingement against the Internet search giant's video sharing website subsidiary YouTube.

The Federal Trade Commission (FTC) today gave its clearance to the agreement between Google and DoubleClick.

Source: GuardianUnlimited and MarketWatch