Online Advertisement: How Can It Make So Much Money?

I am consistently amazed by how much money is being made through online advertisement.

• Question: How much money do you think Google or Yahoo is making per search?

• Answer: According to TechCrunch, it is 9 cents for Google and 4 cents for Yahoo.

This is much more than most of the people I have talked with would have expected. And frankly, I find it hard to comprehend how this amount can be so high. As far as I can remember, I can't recall ever clicking on an advertisement shown by Google search. Granted, most people out there are not using the Web the way my friends and I do. But still, 9 cents per search?!

This is for search. Now let's look at blogs. Russ has been documenting how much he has been making through advertisement on his blog. Recently he mentioned that when his blog had 10,000 page views per day he was making about $100 per day with Google AdSense. That gets you to 1 cent per page view. 1 cent isn't as good as 9, and evidently searches are easier to monetize than page views on a blog, but this is still pretty darn good. Surprisingly so.

* That tells you how good Google is compared to Yahoo at picking the right advertisements.