Here's another example of how Google will make MORE money with the new policy.
Let's use my Flower Delivery example. Right now, as I mentioned, the top spot goes for about $13. And lets say it is for flowerdelivery.com.
Flowerdelivery.com has an affiliate program. An affiliate decides he/she wants to advertise under the keywords "Flower Delivery". They open up an adwords account and see that the top spot is out of their reach, budget wise. So, being inexperienced at the marketing game, they think, boy I can get a much cheaper spot and still make tons of money. Fact is, as I mentioned above, if the first look at the flowerdelivery.com site didn't do it for the consumer when they clicked on the top spot, then seeing the same site again isn't going to suddenly magically make the site everything they wanted, and more. In short..no sale.
So, Google brings in the new policy, eliminating the "repeat offender". First off, surfers receive more relevant results. And second, google now makes More money. How you ask? Well say the same affiliate above decides he still wants to advertise under "flower delivery". The underbidding door has been closed. So now, if he wants to compete, he/she will need to pay more then the top bid for flowerdelivery.com. A bidding war starts...and google wins. Actually overall the affiliate wins as well in the long run. He wasn't making money repeating the same site...so now, he has a fighting chance.
As a side note, and no offence to the adult industry..but this isn't where google makes it's money. You can get in the top positions for a word like Milf for about 20 cents. And the 5 cents a click from the copy cats isn't giving the big return to google. The money is in the mainstream. Here, a click for something like Mortgage can go for upwards of $20+ PER CLICK. And further, a surfer looking for Mortgage quotes tends to be a bit more critical of the search results then a surfer looking for free milf pics.
I mentioned it before, and I will mention it again: Want to compete in the Adwords game..a good place to start is Perry Marshall's
Definititive Guide to Google Adwords.