[evolution]

Standard economics. As you start penetrating potential audience its going to get saturated after some point until you reach all of the audience. As impressions to get one more click are needed more, google needs to exhaust their inventory more. Apparently CTR is going to degrade, and google will start increasing marginal cost per click. Cost per click is curve is often going to be marginal cost curve, where maximum profitability is at lowest point on the curve. Its not about profitability of google adwords but the profitability of the media you're bidding for. When saturated you can always expand your potential market (audience) by adding more keywords/placements.