Pay per click advertising is really like any other advertising - someone has to know what they are doing and measure the results to be successful. In the article above, it doesn't sound like any one the people represented in the stories knew what they were really doing and did not watch the results closely.
PPC can be very effective. We have several clients that are doing quite well on their own. We also manage campaigns for clients that do very well. The key is to 1.)
target the best keywords, ones that are relevant to the business, ones that people are actually searching for and ones that will produce the effect you are looking for, 2.)
write effective ad copy, 3.)
measure results meaning tracking which keywords are effective and which are not, which ads are effective and which are not and finally 4.)
watch the bottom line, measure conversions/sales against what is being spent on advertising. Se a percentage of what you want to spend compared to what you make and stick to it.
The problem with PPC campaigns like Google and Overture is that they are self-serving which is good for marketing people but not so good for people that don't know the first thing about marketing. If they are of the latter scenario, then my advice is for them to hire a company that can manage a PPC campaign for them. Our company for example does this and we charge 15% of the client's budget with the PPC provider. That way the advertiser can focus on what they do and the PPC management company can deliver a successful PPC campaign.
PPC is not like a slot machine. It is not the luck of the draw. It has to be strategic in planning and then carefully managed. Then it can be very effective. The plain fact that Google and Overture/Yahoo! have grown to where they are at today proves that many, many advertisers are having great experiences with PPC.
Mmmm... I think I just got an idea for my next article.