Simply stated, Google AdSense enables website operators to place some code on their site that connects to Google's ad server content database and pulls keyword-relevant advertising onto the web pages. The webmaster gets paid a percentage of the fee that Google receives from the advertiser every time a visitor clicks on an ad. There is no charge for the webmaster to participate in AdSense. All costs are covered by the advertiser who participates in the AdSense sister program called AdWords.
Google's sends out digital ?robots? which use proprietary algorithms to parse the host web page and analyze the content in an effort to determine what keywords are relevant. It reports its findings back to Google's ad server which then serves ads matching those keywords. Given that the entire process is automated, the ?ad robots? do a pretty good job of getting the advertising content right most of the time.
The History of Google AdSense
Google AdSense has its roots in the old ?Google Content-Targeted Advertising? program which they introduced back in March of 2003. Although this program was similar in concept to AdSense, there was no automated way of participating. Each webmaster negotiated a deal directly with Google, and websites that served less than 20 million page views per month were not welcome to participate.
As Google grew, they began to see how much money they were leaving on the table by excluding the smaller sites, which greatly outnumbered the sites serving over 20 million hits that were willing to serve other people's ads. Their answer to that problem was AdSense which has no minimum traffic requirements and is open to all sites meeting Google's content and decency requirements.
How much can you make running Google AdSense?
The answer to that question depends upon three factors:
1. How much traffic your site draws
2.How many visitors click on your ads
3.How much those ads pay per generated click
With some ads paying as much as $5 or more, it's possible that you can generate a serious income with AdSense. There are relatively well documented cases of some people earning as much as $500 per DAY and more. Numbers like that are rare exceptions however. Even so, there is no reason why you can't earn somewhere around $1,000 per month, or more, once you get the hang of it.
