econman - 5:44 pm on Aug 2, 2005 (gmt 0)

I think these are the factors that would determine whether it would be profitable/viable to purchase one of the top 3 positions on Ask.

1. Whether your conversion rate will be higher for Ask's users than the average for Google's users. If, for example, Ask's customers tend to buy more, you could afford to bid more on Ask than you do on Google. The nice thing about this, is that you can experiment with it, and whatever you do has no impact on your regular ppc campaign on Google.

2. Whether Ask computes the "premium" relative to the amount advertisers pay to Google, or the amount Google sends to Ask. Using the 80% assumption mentioned in an earlier post, and assuming Ask demands a 10% "premium" but they compute this relative to the amount they receive from Google, then you might be able to bid as little as 10% LESS than the top bid on Google, and get the #1 position on Ask.

3. What's going on with respect to CTR and its influence on Ask's analysis. We know that Google considers CTR in deciding where to place specific ads. Even if Ask attempts to do something similar, it may not do it in the exact same way, or perhaps the CTRs of specific ads will differ for Ask relative to Google, due to differences in the users frequenting the two sites.

Bottom line: I don't think we know enough to predict whether it will be profitable, but it might be worth some trial and error testing.

There could well be some profitable opportunities created by this new environment, for those who have the time, patience, and incentive to experiment.