anand84 - 5:21 am on Sep 13, 2010 (gmt 0)
If these are counting as impressions, then Google's plan is working perfectly. More impressions will decrease your CTR and drive your click price up.
Isn't this all relative. I mean, if CTR for everyone else stays the same and only yours drop, your click price may go up. But in this case, everyone is going to see a drop in CTR which means the click price should not be affected.
Having said that, I see another reason why click prices can go up. With the predictive search queries showing up, I see a standardization of long tail. People researching on 'red widget' may all end up entering the same 'red widget reviews' keyword because Google shows them that.
Consequently, even if there are several different keyword combinations that people may have otherwise used, they will now all end up using the same keyword combination - thus driving the price up for this keyword.