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Tuesday, December 13, 2005

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Peter Hershberg

Does it accept its proper role in life and aim to become the best PPC contextual advertising engine in the world? Or does it retreat into a walled garden by barring Alexa-driven websites in its AdSense terms of use?"

Waineright's scenario is an interesting one, but given the most recent change to the way Google calculates "Quality Score," it won't need to amend its AdSense terms of use to address the issue.

In fact, that's why many people have been calling Quality Score, "Revenue Score" instead.

As we've all heard, Google is now factoring the quality of an advertiser's landing page into the minimum bids it'll require for a keyword. This change is aimed directly at publishers who are monetizing their landing pages through AdSense or any other form of advertising -- including Yahoo Publisher Network. If they use AdWords to drive traffic to their sites, they're all going to be penalized by Google's Quality Score.

So, while Google won't allow a developer to put AdSense on a search results page, it'll be more than happy to allow them to use YPN or any other contextual network instead. They'll simply use Quality Score to set the required minimum bids to a level where the CPC not only meets -- but probably exceeds -- the revenue Google would otherwise receive from a combination of the click from AdWords and its share of the publisher's AdSense revenue.

In other words, Google is already making it extremely expensive to buy distribution through AdWords if a publisher is working with a competing ad network. They're in a position to do the same thing to any developer looking to use AWSP to create a vertical search engine. And in the end, Google will make up for any lost AdSense revenue by simply increasing the cost of AdWords.

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