As Microsoft ushers in Kya Sainsbury-Carter to head its $18 billion digital advertising business, Bing Chat is joining her at center stage. The company has plans for generative AI to transform the category, including with paid links in chat results. Since February the company has been testing ads in Bing Chat searches. Microsoft hasn’t disclosed how many people are using the new Bing with AI chat, nor how many ads it has served. Bing Chat’s responses include footnoted links to resources amplifying the information in the chatbot’s conversational answers, but sometimes it links to paid search ads.

“While such links aren’t marked as ads in the chat, a user can hover over the link with a mouse, and if it’s a paid link, the ad icon — the word ‘Ad’ in a circle — will appear in the link’s pop-up,” The Wall Street Journal reports. During this pilot phase, “advertisers aren’t bidding on the ads a la carte. For advertisers that are already buying search ads, Bing is incorporating their paid links into relevant chat results.”

Ads that fall within certain highly regulated categories, such as pharmaceuticals, will continue to be presented in a traditional manner within Bing Chat, Microsoft says.

“Bing also is testing photo and video ads that would appear below a user’s conversation with a chatbot,” according to WSJ, which interviewed Sainsbury-Carter, who said AI chat has deepened “our ability to really understand user contact and intent.”

With traditional search, the queries were very specific hunts for a product, the stock price, the weather. “With the new chat experience, we’re starting to see more conversation, multiquery engagement,” she told WSJ, using the example: “I need to throw a dinner party for six and one person is a vegetarian. Can you recommend a three-course meal?”

That query in a legacy search engine will not be on point, but “if you put that in the new Bing, you get something very specific that you can then engage with and go look for the products,” she added.

In January, Microsoft increased its investment in OpenAI, the company behind the GPT-4 language model that powers ChatGPT and Bing Chat. The investment dovetailed nicely with the company’s heightened advertising ambitions.

In December 2021, the Windows-maker acquired AT&T’s Xandr online ad platform, which immediately landed an exclusive deal with Netflix. The company may be increasing its video game advertising ecosystem with the $76 billion purchase of Activision Blizzard, pending regulatory approval.

According to Mashable, Microsoft Advertising “made more than $12 billion in digital advertising revenue last year” from ads that were created, managed, and run through its platform.

That platform also made news this past week when it announced plans to drop Twitter from its Microsoft Advertising plan. “Starting on April 25, 2023, Smart Campaigns with Multi-platform will no longer support Twitter,” Microsoft said.

Mashable reports Microsoft was the latest company to balk at Twitter’s new $42,000 per month enterprise rate to use its API, which it was announced would go into effect April 29.