A year after first announcing plans for a homegrown ad engine, Microsoft is now using the tool for all its U.S.-based search queries.

Microsoft is banking on AdCenter as the lynchpin of its efforts to increase advertising as a source of revenue across the company.

The software maker is still struggling with the growing pains, however. Last quarter, Microsoft shifted the majority of its U.S. queries over to AdCenter. But even with an increase in the number of search queries, the MSN unit faltered as it saw its revenue per search query drop, one of several factors that pushed the unit back into the red.

Still, CEO Steve Ballmer, who is expected to announce the completion of the switch to AdCenter on Thursday, has said the move is worth it, despite some pain in the near term.

"Further growth of AdCenter is key" to taking on Google, Ballmer wrote in an employee memo last week.

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News source: CNET News.com