Google will shortly begin showing AdWords ads within Google Mobile Search. According to the email I received, this will start up in the next few days, and will be free to users of the service through November 18th. Google indicated that they will only show ads for sites whose landing pages that can be adapted for showing on a mobile phone screen.
The announcement made it clear that AdWords account holders could opt out of the service at any time. This is reitirated in the AdWords on Google Mobile FAQ. As a result, it seems that if you want this new service, there is really nothing you need to do. However, if you don't want it, you need to go into your AdWords account and turn the feature off. This will be something you need to remember to do.
The other interesting thing to speculate on is how and where the ads will show up on the mobile devices. All that the FAQ indicated is that the ads will show up on Google Mobile Search pages. The FAQ does indicate that "Ad displays with more than 70 characters are adapted so that only the Headline and URL is displayed when the ad appears on a mobile browser".
It's interesting to see this step take place, as the perennial "year of mobile search", as highlighted in this article by Kevin Newcomb, depends on the proper commercialization of the medium. One of the big challenges is how to manage the usability of ads in that medium. The mobile browser has large space challenges already.
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