See the replies to that tweet. I agree, one swallow does not a spring make; but here there's a pattern. Ask anybody who does search advertising, and you'll hear the same story too many times for it to just be a coincidence.

Most people don't know this, but the Search Advertising auction is a black box. The advertiser just specifies a bid (the maximum they're willing to pay for a click); and the search engine promises that they will not pay more than that.

Here's a trick that Search Engines may (or may not, I plead the Fifth) use: the price an advertiser "i" who bid "bid_i" pays is bid_(i+1) * pctr_(i+1) / pctr_i where "pctr_(i+1)" is the predicted probability of click (pCTR) on the next lower ad; "pctr_i" is the predicted probability of click on the current ad.

Guess who calculates the pCTR? The Engine! In theory, if their pCTR calculations were 100% accurate, all advertisers would pay the minimum bid (which is typically $0.01)! Clearly, this is not desirable. So Engines juice the revenue by tweaking these pCTR values. Talk to anybody who works on auction mechanisms at a search engine, and you'll hear stories of how they tweaked these pCTR values.