In February 2016 Google removed text ads from the right-hand side of desktop results and put up to four above the organic listings. Fewer ad slots meant higher prices and tougher competition for small advertisers, and pushed the line between ads and organic results further down the page. That layout is still what you see today.
Google has removed the ads from the right-hand column of its search results. From now on, at most four ads appear above the organic results, with a few more at the bottom. For anyone paying for search traffic, that is a big change.
Click prices will rise
Google gives the top spot to the highest bid, all other factors being equal. Ads above the organic results have always attracted higher bids than ads to the right or at the bottom. Now more advertisers are competing for less space, which pushes prices up further.
Tougher competition, and what it means for SEO
Fiercer competition favours large advertising budgets, which usually means large brands. Smaller competitors risk being pushed to the bottom of the page, or off it. One possible consequence is an exodus of smaller budgets towards organic search, which would make SEO more competitive too.
There is a second scenario. The expanded top block is more attractive than ever, so big brands may move even more money into paid search and trim their SEO budgets, which would relax competition in the organic results. Which of the two plays out is anyone’s guess right now. We will need to watch the rankings over the coming months.
Conclusion
One thing is certain: the change is profitable for Google, because click-through rates on the top block are higher. For advertisers and SEOs there is no definite answer yet. My expectation is a redeployment of budgets, with big brands spending more on paid search and small providers more on SEO. For searchers, the line between ads and organic results keeps blurring, and knowing the difference matters more than ever.
Note: Google AdWords became Google Ads in 2018. The four-ads-on-top layout described here is still how search results look today.
Questions people ask
Does Google still show ads on the right-hand side of search results?
Not text ads. Since February 2016 text ads appear above and below the organic results only. Shopping ads can still appear on the right on desktop.