By Jefferson Graham, USA TODAY Aug 14/06
MOUNTAIN VIEW, Calif. — Click. That's the sound of found money.
Another check is being electronically distributed by Google to a website owner or blogger, in return for hosting Google ads. The monthly stipends can range from hundreds of dollars to many thousands.
The search-advertising market, with its little text ads published near search listings, is expected to grow to $26 billion in 2010 from $17.4 billion this year, says market tracker Forrester Research. Google accounts for the biggest chunk. The company reported $6.1 billion in revenue last year and nearly $5 billion in the first two quarters this year.
No wonder people are celebrating.
"I put up a website, add the Google ads and wait for the money to start flying in," says Marc Ostrofsky, president of iREIT.com, a major purchaser of website domains. The company owns 400,000 sites, including MutualFunds.com and Bands.com. Fueled by Google ads, the sites generate more than $10 million a year, he says.
Hitting the jackpot
Sponsors love search ads because they pay only if someone clicks on one. Folks like Ostrofsky who put the ads on their sites also get paid for the clicks. Google's AdSense network places ads all over the Web, targeting readers of a specific website or blog.
Google mostly has this corner of the market to itself. Yahoo started a similar service this year as a test, and small players such as Kanoodle and Miva Marketplace are out there, "but Google totally dominates," says Chris Winfield, president of 10e20, a search marketing firm.
Last week, old media titans Viacom and 20th Century Fox announced advertising alliances with Google. The reason: AdSense.
Google's $900 million deal with Fox's MySpace will place text ads on the growing online social network, now the sixth-most-visited website, according to measurement firm ComScore Media Metrix. The alliance with Viacom's MTV Networks goes a step further. It uses the AdSense model to place video ads on MTV and Nickelodeon clips that will appear on blogs and websites.
Not everyone is a fan of some of the get-rich-quick sites. Many are littered with ads and short on meaningful content — a trend known as "search spam."
"AdSense, in my opinion, is the worst thing to happen to the Internet," says John Scott, who runs the V7n.com online forum for search marketers. "Google is ... in essence, paying people to inundate the Web with literally billions of worthless pages."
Whatever its editorial worth, the AdSense business model clearly works for what blogger Jennifer Slegg describes as "hundreds of thousands" of website and blog publishers.