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Its actually a good idea. He gets higher bids for keywords so the people that are actually paying full price have to pay more. He also gets the word out about his site by listing this auction. Its a great idea for a new PPC engine. Its luck whehter or not it'll ever take off. Chances are not, as I've seen hundreds of PPC search engines doing the exact same thing.
I think it would be VERY smart business wise for Overture and others to do this as it would increase advertising revenue dramatically. (That 10 cents a click minimum is just ridiculous.)
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