Yahoo!, like its competitor MSN, is testing a few alterations to the layout and look of its search engine results page this week. The changes are designed to make the results pages more user friendly and to make it easier for searchers to clearly distinguish paid advertisements from organic (or natural) search results.

The changes can be viewed at new.search.yahoo.com while the original layout still remains active at search.yahoo.com. Much like the approach taken by Microsoft, which placed shaded backgrounds behind all paid advertisements, the new Yahoo! layout clearly distinguishes PPC ads provided by Overture by placing them on top of a shaded blue background. You can clearly see the difference in the old and new search results pages for the phrase "used cars."

The layout changes also removes the listing of related categories in the Yahoo! directory and replaces them with a list of suggested related search phrases. Clicking on one of the phrases results in a new list of search results matched to the new phrase. The design also removes the prominent tab style options for switching to image, directory, yellow pages, news and product searches and instead places them as text links above the search box at the top of the screen.

The changes are slight, but significant. The design has a cleaner, more organized look to it and the removal of the tabs moves the search results further up the page. Additionally, any confusion that used to exist between the first few paid Overture listings and the actual organic search results should be easily cleared up by the addition of the blue background.

The results still include the controversial paid inclusion listings that MSN dropped from search results on its new trial run of search listings. The update also comes on the heels of a much reported cut in Yahoo!'s rating by top Wall Street analysts and shortly before the company is due to announce their second quarter earnings.