I am using adwords for 4 months now to promote some of my sites. And I guess the reason why we are getting to low payment per click is that there is an option where you can pay as low as $0.05 in contexttual ads even you bid for the highest position in google search. For example for the keyword web hosting let's say position number 1 for this keyword you need to bid $12. So everytime someone search for the keyword web hosting my ad will be displayed number in google search result ads. And when someone click on my ad I will pay google $12, and they will earn $12. But on the option from my adword account I can change the amount I will pay for a click from a contextual ads for as low as $0.05. So when my ad display in your site I will only pay $0.05 to google and google will get their cut from $0.05 and you will recieve your share from that $0.05. See most of the advertiser now know this technique and they take advantage of it. Google really make lot of money and publisher no...
With AdWords you can bid as low as $0.01. There is no longer a $0.05 lowest bid. MSN adCenter has a minimum bid of $0.05 and Yahoo Search Marketing has a minimum bid of $0.10. But, if there is any competition for a keyword, you won't get your ad displayed if you are bidding the minimum. If you try and bid $0.05 for the keyword "web hosting", AdWords will tell you that the bid is too low and you need to raise your bid.