AOL plans to introduce a service today (Monday) to directly sell ads that will appear next to its search results, which are powered by Google, writes the New York Times.

Called AOL Search Marketplace, the service will allow marketers deliver ads only on AOL sites. Until now, Google has been selling all the ads displayed alongside searches on AOL sites. The special dispensation is apparently in line with a December 2005 deal in which Google paid $1 billion for a 5 percent stake in AOL.

AOL has tested the new service with some 30 advertisers and will now open it to its entire advertising base. The ads sold by AOL will be routed via Google's advertising system and displayed next to the search results viewed by AOL users.

Google and AOL, which share revenue from Google ads displayed alongside AOL search results, will also share revenue for the ads that AOL sells, but AOL will get to keep a larger proportion.

AOL has altered it business model, offering most of its services free, supported by advertising rather than subscription fees. It says its ad revenue climbed 41 percent last year, to about $2 billion.