A clarification on my previous post about house ads run by Google on publisher websites, as part of the AdSense creative. Yes, Google confirms, it pays for the ads and enters the auction independently, so publishers are paid for those ads.
A similar confirmation (from the Google rep who posts on Search Engine Watch Forums) was received recently as a result of a forum discussion about the same issue as it relates to the ads on the search side. There, too, Google runs its own AdWords campaigns and participates in the auction like everyone else.
In that debate, it didn't seem that forum posters were entirely satisfied with that response. Everyone has had the challenging experience of bidding against a deep-pocketed competitor such as Dell, Microsoft or Yahoo. It can be particularly disheartening when that competitor is actually Google, the one running the ad auction.
Admittedly this is not as much of an issue on the AdSense side because there is no expectations on the part of the advertiser that they will show up in any given ad creative in a more or less visible position, and the bidding aspect simply works differently (smart pricing, etc.)
Google also wanted to make it clear that its house ads are not to be confused with public service announcements which run from time to time on pages where no good ad matches apply. Publishers are not paid for PSA's. Publishers can override the PSA's, should they desire, by choosing the "alternate URL" feature.
Posted by Andrew Goodman
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