I have often pondered this question?
Here are my own basic thoughts on the complex subject.
Most websites I visit have some kind of adsense system running; I would estimate that some of these are making good money from the Google system. Certainly sites with over 1000 visitors per day should receive a small amount of revenue.
Generally I believe the adsense system is a good one, however like most things these days the adsense system has been misused by individuals who fully understand how search engines work; unfortunately these people have already made their money. These people have used many tactics in the past to raise their sites page ranking, thus ensuring more visitors, more visitors means more revenue from the system. These sites are generally kept open for a few months and then closed down, with the next one instantly opened up. This practice has been going on for years. The sites are even sold daily on EBay; I would imagine they are just about to be banned.
What normally happens when a few people misuse a system is it leads to others suffering, and in this case it has happened. Google is sandboxing new sites for longer. Saying this company...