Adsense has been around since 2003 in its current form, and for many users represented the best option for webmasters to make money from their websites. For a long time, though, blogs weren’t permitted to add Adsense. Eventually, Google relented and a boom followed in Adsense. There have been a number of stunning Adsense success stories, too.

Now, though, after using Adsense for a number of years, I’m becoming rapidly disillusioned for a number of significant reasons. (As this story updates, and gets comments, I’ll be adding links throughout the story updating facts as far as I can).

1. Revenue per click is falling. While Adsense TOS prevents me from telling you what it is, I can tell you: From the first year to the third year, the revenue per click has dropped by more than 33% for my sites, AND IT IS STILL dropping. In the second year, it dropped by 10%, then in the third year, it dropped by nearly 27%. And since the beginning of the fourth year, it has dropped by a further 2% in only 3 months.

2. Adsense takes your advertisers and gives you pennies on the slot. For many websites, using Adsense allows advertisers to use your blog to reach your audiences rather than pay a lot more: in many cases, you can get your ad (albeit amonth others displayed for a few cents a click compared to purchasing a proper link or a larger ad block or image). It’s like a one-night stand, except in many cases, it doesn’t even last one night. It’s displayed and it’s gone. Many larger blogs now forgo Adsense because of these problems.

3. Their advertisers compete with YOU. If you are using your blog or website as a way to sell your own services or business or products, often you will find not just related products, but also directly competing products and competitors, who are paying you cents to steal customers who would pay you dollars. Does this make sense?

4. You don’t get paid when Adsense ads are not clicked, but the ads still get ‘viewed’ by individuals. In many cases, the ads are given prominent spots, but the reader doesn’t click. Does the reader see them or not? The readers have read many ads, but never clicked for a variety of reasons. But they have read the ads. You don’t get paid, usually. Occasionally, you will be paid for impressions, but not usually.

5. Clicking on Ads takes readers away from your blog. Do you want your readers to leave? Of course, you’d rather they didn’t, but if you place the adsense blocks in the ‘optimal’ positions, you are virtually guaranteeing that your readers will leave by clicking on an Adsense link. But usually readers won’t come back after viewing the linked site. They may, as I do, view the advertisers site, note the URL and either go to a search engine or close the window entirely.

6. For low-trafficked websites, Google Adsense just not generate anything more than peanuts for your traffic. With pageviews in the hundreds or low thousands per month, there is hardly enough traffic to earn more than a few tens of dollars per month. In fact, using the valuable advertising space for Adsense actually will not help to add value to your blog or generate much revenue.

7. Inappropriate ads often appear on your blog. On my ESL website, I’ve had links to all sorts of weird things; and on this blog, I still get weird links to websites completely unrelated to anything on the website page. I’m not talking pharma ads or adult ads, which Google prohibits. But still, the webmaster can’t choose what ads do appear on the website. This means that webmasters and site owners rarely have control of who is advertising. This is not a good thing.

8. Google is very strict on click fraud. To the point that one suspects they are even taking legitimate clicks and counting them as invalid. Of course, you aren’t able to monitor which clicks on your ads are invalid, or any statistical information, leaving you to guess about how many clicks are being discarded.

9. Google also bans Adsense publishers for instances of click fraud. Though many may deserve the banning, I’ve read of a few webmasters who would likely never commit click fraud, yet were banned for no apparent reason. Additionally, they weren’t notified of the particular infractions, discouraged from appealing, and the whole affair was conducted in secrecy, a secrecy that does not befit a major US corporation. Of course, when you are banned, you lose your account, your money, and your reputation is slighted. Google, of course, offers no proof. You are banned without a trial, or even a specific charge. And there are serious issues with the security of Publisher’s accounts.

10. It’s not smart to put all your eggs in one basket. Why? Because if you are serious about developing your blog as a separate income and business, you MUST develop multiple sources of revenue. Relying only on Adsense is perhaps the dumbest decision you can make, especially because you put your business at the mercy of just ONE supplier, Google. As many bloggers found out this week, this can have disastrous consequences when Google, who also provides search engine traffic, website rankings and a variety of other services, also provides a large percentage of your traffic. Many blogs were subsequently stung by Page Rank downgrades, resulting in lower earnings potential and possibly less traffic. In some cases, Google even deliberately removes websites from the rankings because they claim the website master is abusing the Google search engine.

Looking forward to your comments.

Disclaimer: This website currently uses Adsense on its pages, has about 5% of its traffic from Google and may utilize some other Google services, such as gmail, analytics and so on. But InvestorBlogger is seriously unhappy with Google’s recent performance on its Adsense, PR rankings, and the way that Google is becoming a ‘Be Seen to Do No EVIL’ force.