Facebook has released a way to search the web through the search toolbar on its site, using Microsoft’s Live engine. See screenshot. The two companies have already announced the search option, although details weren’t clear at the time. Now that the feature is live, it’s interesting to see that the results on the Facebook page aren’t quite the same as those on Live’s own site. This seems to mean that Facebook is using its own ranking methodology on top of Live — likely using information that it has about you and your friends?

Below, in a search for “palo alto restaurant,” Facebook is showing me the Lavanda wine bar in Palo Alto as the fifth result, while Live isn’t. Is Facebook delivering information about Lavanda as a result of the networks I’m a part of, located nearby? I’m asking Facebook for further comment.

Search is a proven way to make money, as users who search for things are typically more likely buy something than users who are, say, messaging friends on a social network. But the relationships you have with your friends on social networks, could lead to more relevant results, as we covered in this in-depth interview with Google’s Marissa Meyer earlier this year. Indeed, Google already handles search on MySpace’s site (a deal that generates a lot of traffic for Google), although it doesn’t currently use MySpace information to target results, that I am aware of).

Meanwhile, Microsoft is a strategic investor in Facebook — and Microsoft’s search share keeps dropping versus Google’s. Facebook has previously said that it’s working on its own search engine, but it has also said it’s going to be using Live. As you can see below, both seem to be happening.