Google’s AdSense is finding more inventory, now on mobile devices, tapping into the healthy proliferation of applications (apps).

AdSense for Mobile Applications launches today and supports both iPhone- and Android-based applications. IAC’s Urban Spoon, music discovery app Shazam, and radio app FlyCast are among the first using the new ads.  Google claims the service gives developers control over the placement and appearance of ads, presumably similar to standard AdSense for content.

On the advertising side, the process by which advertisers select their audiences and bid for placement is largely similar to the Web-based version of AdSense. “Placement targeting” (choosing which app to advertise on), keyword and broad geo targeting are carried over, although placement targeting is still in the experimental phase.

Google began testing mobile app ads on Urban Spoon three months ago. Its biggest competitor is AdMob, already entrenched on dozens of popular apps.

Since February, AdSense publishers have been able to choose from among three font styles (Times, Arial and Verdana) for their ad units. Now, publishers have some control over font size, as well.

Publishers can choose small, medium and large, subject to what can fit within the ad unit’s dimensions, with small being the current default (that will soon be changed to medium). A size default can be set across your entire account, or you can adjust size at the ad unit level.

It’s great that AdSense is giving its publishers greater control over the way text ads are presented. Publishers might have their own aesthetic preferences—such as wanting the font in an ad to match the font used for content on the page, in terms of face and size—or they might want to experiment with the sizes that improve ad performance. Larger fonts are likely to perform better than smaller in most scenarios, but, as we like to say, without testing, you can never be sure.

When it comes to predicting when the macroeconomic recovery is supposed to come, it’s anyone’s guess. Online advertising, though, is widely understood to be weathering but a small setback in its naturally high growth rate, and recent statistics suggest that the first-time drop in online ad growth is fairly modest, all things considered.

None other than the Beast from Redmond (or rather, a representative from one of its European operations) expects that a recovery won’t happen for another 3 years. In the meantime, John Mangelaars, Microsoft VP Consumer and Online for Europe, Middle East and Africa, suggests an industry shakeup is likely with even established players being winnowed away by an increasingly competitive market.

Why? Part of the reason is efficiency: technology has enabled marketers to better understand and target their spend. Implicit in this is the opportunity to grow when spend can be scaled without compromising ROI.

I’m current at OMMA Publish, the association’s annual conference dedicated to the issues confronting publishers, and this morning’s “great debate” was whether publishers should work with ad networks to monetize their remnant inventory, or if they should sell all of their inventory themselves. Panelists Walker Jacobs (Turner Sports) and David Koretz (Adventive) repeated that allowing advertisers a low-cost channel to purchase advertising through an ad network leads you to a “race to the bottom.”

It’s possible then that advertisers are simply becoming more sophisticated, finding the lowest-cost pathway to buy media, often through ad networks. Networks are offering greater control over ad placement (to avoid problems surrounding sensitivity around context), audience targeting and performance analytics, and their ability to scale might be giving advertisers the right combination of features that they’re looking for. Ad networks have certainly grown their share of total ad spend over the last few years. Whether the drop in unsold inventory has come with a concomitant drop in spend is certainly up for debate.

Yesterday I attended DM2’s ad networks and audience targeting mini-conferences, Digiday Networks and Digiday Target (Twitter #digiday), part of Internet Week here in New York. Both conferences consisted of panels delving into the directions ad networks and behavioral targeting are headed in this time of tightened online ad spend and the growing specter of consumer backlashes over privacy.

The biggest question tackled by panelists in Networks was the fate of the 400-600 (?) ad networks that currently serve up a fragmented market today. Cases were made for their consolidation and buyout by agencies and larger networks, as well as their continued proliferation. Mark Zagorski of the behavioral targeting data exchange Exelate argued that a shakeout has been predicted for quite some time, but still hasn’t happened–an increasingly fragmented ad market continues to serve increasingly fragmented media. Because audience behavior continues to be fine-tuned, ad networks that can deliver the specific audiences advertisers are looking to target will command higher prices, while those without granular audience information will earn less. And, increasingly, audiences are meaning specific purchasing behaviors and stages within the buying process rather than conventional demographic slices, although, according to Amanda Kanaga of Time Warner, agencies are still not yet asking for them.

When it comes to bridging the “data gap” between data providers and agencies, the onus is on the data providers to not only deliver data relevant to advertisers, but also provide the means to apply data-driven insights to media buying and campaign analytics and ROI measurement. Unilever’s Jim Keyt said he was interested in “solutions,” not just data.

There was surprisingly little discussion about privacy concerns and the threat of government regulation of data ownership and use outside Stephen Baker’s (BusinessWeek columnist and author of The Numerati) keynote. However, a speaker argued that the issue goes far beyond online advertising, noting that his supermarket loyalty card probably has more private information about his buying behavior than his ISP.

One of the most interesting startups I heard of was MetricMesh. I spoke with its CEO, Shah Ullah, who explained how the company is aggregating cross-device audiences in order to plan campaigns across media as different, but complementary, as online, mobile and television. Agencies and advertisers can target MetricMesh publishers who can serve ads to audiences that have displayed the sort of behavior across TV viewing, Web site and mobile usage patterns. Interesting stuff!

Just like Anton Chigurh chasing Llewelyn Moss, Google is following you, and similar to the No Country for Old Men hitman, they’re after the cash.

Well, maybe it’s not quite that sinister. A new study published by graduate students at Cal shows that Google, through a combination of its Analytics and advertising (AdSense and Doubleclick) services, manages to drop its pixel on 92 of the top 100 Web sites, and about 88% of the top 400,000 domains (video).

Google maintains that, as a matter of policy as well as technology, tracking individual users is not something they do. If you believe their motto, you might be inclined to believe them. But with such comprehensive reach across the Web, even aggregate traffic behavior statistics give the company something very valuable: the means to properly price inventory.

To do this, Google must integrate its analytics and advertising data, something it also claims that it is contractually obligated with its advertisers not to do. That might be the response to privacy advocates, who are concerned with behavior tracked to individuals. But if that data is anonymized and aggregated? The Google Toolbar captures it, and I suspect if you dig through the Analytics and AdSense TOS, you might find that it’s not prohibited with these services, either.

Advertisers picking placements in traditional media, such as magazines and television, often have a lot of control over where their ads are placed. They typically have access to the editorial calendar or a synopsis of the episode to be aired, and also often know who (some of) the other advertisers are.

In contrast, advertising online usually affords advertisers relatively little control and transparency into the environment their ads are being placed in. Although they can often cherry-pick the sites where their ads appear, they can’t usually pick what content is running adjacent to their ads. Transaction-oriented advertisers might not really care, but this is the sort of thing that drives big brand advertisers and agencies nuts.

Social media ad network BuzzLogic has launched what it calls its “Conversational Advertising Dashboard” to allay exactly these types of anxieties. Information about the type and tone of the ad-adjacent content, the scope and nature of the conversations, author credibility, content freshness and ad performance by conversation are provided, across the 3,000+ “influential” blogs in its publisher base. Along with insight comes control: advertisers can yank placements if they don’t like what they see.

BuzzLogic’s dashboard is an addition to its Conversational Advertising platform, which it launched last year. The network reaches 33.3 million unique monthly visitors and serves approximately 2 billion impressions in concert with networks such as AdSense, BlogAds and Adify.