Yahoo!'s campaign to increase its share of the search advertising market received a boost yesterday with the announcement that Viacom had signed up the company to deliver adverts to some of its entertainment sites.

The agreement, which covers 33 of Viacom's sites, including MTV.com and Nickelodeon.com, was seen by analysts as a sign that the legal battles plaguing Google, Yahoo!'s rival, are beginning to benefit competitors.

In announcing the deal, which could be expanded to 140 more sites, Terry Semel, the Yahoo! chief executive, took a swipe at Google, saying that Viacom "shares Yahoo's commitment to connecting users to the content, products and services for which they are looking while respecting copyrights and other intellectual property rights at the same time".

Viacom sued YouTube, the video-sharing site owned by Google, four weeks ago for $1 billion (£506 million) after pirated versions of its content were uploaded to the site.

Under the multiyear deal, Yahoo! will provide search services and deliver adverts to some of Viacom's broadband sites, including VH1.com, comedycentral.com, and BET.com.

Financial terms were not disclosed.

It is the most significant deal for Yahoo! since it introduced its new search technology called Project Panama, which is designed to make adverts more relevant to the search results they are displayed alongside.

Panama delivers both search and display advertising, and will be able to be adapted for audio and video searches, Yahoo! has said.

"Looking at their Panama system and its capabilities made us comfortable," Philippe Dauman, the Viacom chief executive, told the Los Angeles Times.

The company had explored deals with Google and Microsoft Corp's MSN, but with Yahoo! "the economic terms were very favorable in absolute and relative terms", Mr Dauman said.

Rebecca Jennings, a senior analyst with Forrester, said: "The problems with Google will certainly have influenced Viacom's decision, and they'll feel better that they're working with Yahoo!, but they wouldn't have gone through with it if they weren't convinced Yahoo!'s service was as good as Google's."

Yahoo! shares have risen 24 per cent this year, largely because of investor confidence about the company's new advertising system.

Google shares have gained less than 2 per cent during the same period.

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