LucidSW - 1:37 pm on Mar 1, 2012 (gmt 0)
One big flaw in your theory. It totally goes against Google's stated purpose to show the most relevant results possible. That's for both organic and sponsored results.
The ads are going to take care of themselves thanks to the Quality Score system. The cream is going to rise to the top.
Now, I don't believe they would purposely degrade the organics. But they are always trying to find out ways to make the ads more attractive. They've been doing this for over a year now with numerous tests and actual changes in how Adwords shows ads. They've always been doing this but since last year, the pace seems to be accelerating but that may be just my impression. Like any other good business, they are trying to maximize their revenues while balancing product quality on the part they don't make money. Question is, has their revenue and profit gone up significantly compared to other years in 2011?
Trying to get sites with Adsense higher in the rankings at the expense of quality goes against what they've been saying for years about themselves. We can't prove one way or another that there's such a component to the ranking formula. So in my mind, all you have is a theory which will never be proven. You're not the first to suggest things like this and won't be the last.
You say Google demotes publishers. The reason publishers are demoted is by not following policies. This does not lower the ad inventory. It lowers the number of sites an advertiser can use but this inventory of Adsense sites is so large, it has no effect. It certainly does not increase CPC. That's just not the way Adwords works.
Google's definition of site quality is not the same as most people think. Most people are stuck on the word quality to mean a certain thing when in fact, it means something totally different to Google.
Why would Google squeeze publishers? They want more of them and of good quality. Reducing that inventory just doesn't make sense. Your argument, and I've heard it before, is to avoid paying whatever percentage they make from people clicking ads. But if there was not ads to click on and no publishers, they wouldn't make money. If that were the case, you wouldn't have affiliate marketing. Why would I pay someone a percentage of my sale to you for referrign that sale? Because it works and I'm making more money that way.