Microsoft paying to advertise Bing on Google?!?!

I found this hilarious on a variety of levels: Microsoft is paying Google to place ads for it's new Bing search engine on Google (see the screen grab from my Gmail inbox below).

It has got to cause some serious pain at Microsoft to pay this bill. Did they use Steve Balmer's credit card to setup the Adwords account?

Who is the person at Google that signed off on this? It takes some balls to happily place ads for your competition on your own site.