Targeted adverts to pull in huge untapped audience

Google plans to turn its collection of widget applications into a revenue stream by using the small web apps to display adverts from Google Adwords clients.

Adverts placed in the widgets will be targeted to specific keywords, in the same way as Google's traditional web adverts.

However, the search giant will measure the effectiveness of the ads by how much user interaction they produce, rather than how many click-throughs are achieved.

Widgets have traditionally been free to use, but companies such as Google, Yahoo, Apple and Microsoft have looked at how they could be used to turn a profit since their popularity has grown.

Photo-sharing website Slide started the trend to monetise the applications when it said last month that it would include ads in its widgets.

Slide's widgets are the most widely used on the web, according to audience measurement analyst comScore Media Metrix.

The small pieces of software, which Google and Microsoft refer to as 'gadgets' rather than widgets, add features to websites or to software such as the Google Desktop application.

Google currently offers more than 14,000 individual widgets, including a BBC Radio player, a calculator, an English to Tamil dictionary and a Champions League football information portal.

Amazon launched seven configurable widgets this week allowing customers to post their favourite Amazon products on blogs, websites and social networking pages, with users earning referral fees.

However, web security firm Finjan has warned that the increasing use of widgets is exposing computer users to a host of attacks.

Around 87 million Americans used an online widget in June, according to figures from comScore Media Metrix.