Google offers new referrals for AdSense... http://adsense.blogspot.com/2006/05/new-referrals-for-google-pack-and.html

But how does Google actually make money from this? As far as I can see they don't. Although it does mean people install their software. It may be profitable in the long run(with people clicking on ads etc), but isn't it a bit of a gamble?

I'd agree. It is. Especially since the products which they are advertising through this program are completely ad free as far as am aware.

This is a lot of money to spend on increasing "stickiness".

I'm suprised google hasn't allowed other companies to get in on this. Like letting apple have referrals etc.. maybe this will come

Well they do Firefox, although this is through Firefox-Google's "special relationship".

Once you start getting more companies involved the difference between the referrals and the ads decreases I think. The only remaining difference would be that for referrals you get more money & in referrals the user has to sign up / download / use.

> But how does Google actually make money from this?

Good question. Maybe they write it off as ad budget expenses?