Tuesday, 13 February 2007

AdSense and Exchange Rates

I realized that I've never seen anyone blog about this issue before but I think it's an important one that needs to be addressed.

Does Google allow for current exchange rates when calculating AdSense earnings?

This issue is premised on a few basic facts:

  1. All AdSense earnings are calculated and reported on in U.S. dollars
  2. AdSense ads are ads from the AdWords content network, which are paid for (and bidded on) in local currency
  3. People browsing sites containing AdSense ads get ads served to them based on their geographical location
So, here's a scenario.

I am in the U.K. which currently has an exceptionally favorable exchange rate against the U.S. dollar. I have various web sites serving AdSense ads. If someone from the U.K. visits one of those sites, some of the ads they see may well be from advertisers whose target audience is solely within the U.K. Thus, if one of those British ads gets clicked on by a British visitor, is the current exchange rate taken into account when my AdSense earnings are calculated?

At the moment, the same ad on the same site should be worth more to me, all other things being equal, than it would have been a year or two ago because of prevailing high value of the G.B. pound against the U.S. dollar.

If you have any thoughts or information on this topic, please leave a comment.

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