Google AdSense -- business model

Google touts its AdSense to Web site publishers as a way to “earn more revenue from your website, while providing visitors with a more rewarding online experience”:
When you display Google ads on your website, you’ll be maximizing your revenue potential. Google places relevant CPC (cost-per-click) and CPM (cost per thousand impressions) ads into the same auction and lets them compete against one another. The auction takes place instantaneously and when it’s over AdSense will automatically display the text or image ad(s) that will generate the maximum revenue for a page — and the maximum revenue for you.
MORE: http://blogs.zdnet.com/micro-markets/?p=190