The New York Times has updated its story on the deal between Google and Time Warner, providing further details about the terms. It reveals just how desperate Google was to maintain the AOL partnership:

In the new arrangement, Google will offer promotion to AOL in ways it has never done for another company, two executives close to the negotiations said.

If a user searches on Google for a topic for which AOL has content – like information about Madonna – there will be a special section on the bottom right corner of the search results page with links to AOL.com. Technically, AOL will pay for those links, which will be identified as advertising, but Google will give AOL credits to pay for them as part of the deal. They will also carry AOL’s logo, the first time Google has agreed to place graphic ads on its search result pages.

Google will also provide technical assistance so AOL can create Web pages that will appear more prominently in the search results list. But this assistance will not change computer formulas that determine the order in which pages are listed in Google’s search results.

Google will also make a special effort to incorporate AOL video programming in its expanding video search section and it will feature links to AOL videos on the video search home page. These links will not be marked as advertising.

An executive involved in the talks said Time Warner asked Microsoft to give AOL similar preferred placement in advertising and in its Web index and that Microsoft refused, calling the request unethical.

Ouch.