Deepesh Agarwal owns a tiny cybercafe in Rajasthan, a northern Indian state bordering Pakistan. Rajasthan is poor. People there earn an average of just $300 a year. It’s the kind of place where an Internet cafe owner can make enough money to get by, but Agarwal isn’t getting rich. Or, at least, he wasn’t until recently.

In his spare time, Agarwal runs a Web site offering free downloads of a grab bag of software. He recently signed up his site for Google Adsense, a program in which Google pays Web site publishers for advertising space. Google automatically places ads on the site and, for each click on an ad, Google makes a small profit from the advertiser. It then pays Agarwal and other site operators a percentage of that revenue. Depending on a Web site’s traffic, clicks on advertisements can translate into pennies—or dollars—a day for the site’s owner.

Google refuses to disclose the exact percentage it pays out, but even a small portion of the nearly $2.7 billion it made in Adsense revenues last year is serious money for the poor. For Agarwal, Adsense earnings now account for 90 percent of his income, about $1,500 a month. “Adsense has changed my life,” he says. “I can afford things that I was not able to before. I am planning to buy a new car. I can save for my future.”

He’s hardly alone. Since its launch in 2003, Adsense has revolutionized Web publishing in the developing world, turning blogs and personal sites into profitable enterprises. Mohamed Sallam, from Cairo, nets about $500 a month from ads on his Web site, a forum dedicated to discussions of Islam. In New Delhi, Jayant Gandhi uses Adsense to earn about $1,000 a month—the same...