Jim Larrison writes an insightful post highlighting both the misconceptions that publishers have about Adsense, as well as the limitations of the Adsense model.

Here is an excerpt:

“Many bigger publishers or broad network entrepreneurs come into the planning around their network with one big mistaken assumption. This assumption has existed in the market now for many years, and when people are presented with the truth they are usually shocked. The problem with this ongoing myth is it is getting more and more off base from reality and has a real risk of having your business models for your networks far off of reality.

Over the past few years this misconception has had ripple effects on sites and on network operators and in many cases has had a dramatic impact on their business plans and financial models. What is the misconception you might say? Okay, enough of the drama!

The biggest misconception in the market today has to do with Google AdSense. Most people in big sites or with limited multi-category experience with AdSense have strong beliefs that the effective CPM paid by Google is extremely low and way below the market rate would be for the similar ad spaces on an open market.”