[link|http://www.fool.com/news/mft/2003/mft03100704.htm?source=eptyholnk303100|Motley Fool].

Putting most of your eggs in one basket can get you scrambled, especially if that basket happens to be Microsoft. Last night the software giant announced that it has decided not to renew its sponsored search contract with LookSmart when it comes up in January.

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Microsoft made up roughly two-thirds of LookSmart's listing revenue.

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Because of Microsoft's monopolistic tendencies (and whether that is deliberate or simply because quality wins in the free market is a debate for another day), it will be interesting to see if Microsoft goes with a rival provider or simply develops an in-house solution.

As far as business models go, you've got to love sponsored searches. The advertiser wins because it reaches the appropriate audience. The site displaying the ad comes out ahead as it reaps the fruit of significant yet unobtrusive marketing that will ultimately kill the dreaded pop-ups once and for all.

Someone else learns the lesson of being a Microsoft partner.