Software giant Microsoft appears to be spending money like crazy to force its Bing search engine onto the world. Details of Redmond's finances have been made public after the announcement of the outfit's record profits have died down.

It appears that Microsoft would have done a lot better if it had not had to spend a fortune propping up heavy losses in its Online Services Division as it tries to match rival Google in the online search and advertising market. The OSD reported a 12 percent increase in revenue, which rose to US$566 million on the back of higher advertising revenue. However operating expenses grew like crazy.

The division's quarterly loss grew by 73 percent to $713 million, compared to a loss of $411 million during the same period last year. OSD is Microsoft's online advertising business, the Bing search engine, and its various MSN websites. Redmond said sales and general administration expenses increased by $145 million, largely due to "transition expenses" from the search deal struck with Yahoo, which handles some advertising sales for Microsoft while Microsoft provides for Yahoo's Web sites.

Another source of Microsoft's higher costs was research and development, which increased 33 percent during the fiscal third quarter to $77 million due to higher headcount and payments to Yahoo for expenses incurred before it moved to Microsoft's search platform. Sales and marketing expenses were also higher, up 30 percent to $69 million due to increased promotional activities.