Houndstooth - 6:26 pm on Jun 27, 2006 (gmt 0)

No, I meant CPC. EPC's a whole other story and gets into the CPA discussion and how that will affect the market.

I run search programs for many different companies large and small, so I have a fair amount of visibility into relative CPCs for a given position by engine, which is largely due to differences in position algorithms. So it stands to reason that if advertisers are willing to pay more for a given position on Yahoo, the same avg 80% payout to a publisher would be on average higher for Yahoo ad placements than Google. I fully realize this wouldn't be 100% consistent site by site, but it wouldn't be too hard for Yahoo to know when they start to tip the balance.

Web publishers will always flow to where the economics are most favorable. We saw it happen when publishers dumped traditional commission-based affiliate ads in favor of AdSense, and we'll see it again when the next opportunity comes along. There will be an increasing battle for the huge but finite advertising space on the web, which will naturally push up payouts and also place a premium on functionality, efficiency and effectiveness.