Google's Adwords program is what generates those little boxes you see to the right of Google's search results. Currently Adwords are shown on AOL, EarthLink, AskJeeves, and of course Google.
Adwords work the same was as Overture in that you must bid for placement, however there is less competition so your overall bid does not need to be as high, and there is no minimum bid with Google. Additionally Google will spread your impressions out to fulfill whatever monthly budget you have over the course of the whole month. What this means is that even if there is someone who has bid higher than you they likely will not have their ad shown on every page view. In fact in my test campaign there were 5 competing listings and at least 90% of the time only 2 were shown, and sometimes mine was the only one. What this means is that you can bid low and still be listed highly occasionally.
Additionally, due to their placement, I feel that being listed below other paid listings isn't as bad as it is on Overture. If you're fourth on Overture you might end up at the bottom of the page or not on the page at all. If you're fourth on Google you'll still be there, on the side, and probably not the fourth ad to boot.
Unlike Overture, Google does charge a nominal $5 setup fee. Also unlike Overture your Adwords listings can be live the night you sign up. All in all Google runs a good all around PPC program.
It isn't perfect though. One issue is that you're drastically limited by the size of the back and must often be creative when trying to figure out how to write your ad copy with only a handful of characters of text at your disposal. Another issue is that they monitor performance and if your ads do not perform well they disable them - this can become annoying after awhile and expensive as well. Eventually they'll charge you $5 every time you enable a deactivated ad. One final problem is that Google will not allow you to advertise a site that has popups. On the surface this sounds fine but they don't care what the popup is. For instance I run a popup that is cookie controlled so that each user only sees it once, ever, and it advertises my newsletter. My Adwords listing was eventually disabled when a Google editor noticed this.
I came into this hating LookSmart. Their change from a pay directory like Yahoo to a PPC directory annoyed me to no end, as it did many webmasters. However, what I realized is that while LookSmart may be a bad directory, they're an excellent PPC program. The main draw with LookSmart is getting into the primary results at MSN. See Overture provides MSN with a couple sponsored listings, then LookSmart provides primary results, and after LookSmart results (which can go on for pages) Inktomi comes in and provides secondary results. So for the time being the only way to get into MSN's primary results is through LookSmart.
LookSmart also differs from the other two in that they don't allow you to bid for keywords, everyone in the program pays 15 cents per click. This price fixing is nice because it prevents bidding wars like what you'll find at Overture. It also means that you can get to the top of the listings if you know how to optimize for directories and still only pay 15 cents per click. You can also budget your listings with Looksmart and once you reach your maximum they'll turn your listing off for the remainder of the month.
LookSmart does have its downsides though. It charges a high $29 setup fee, and you could still rejected. It also charges for listing changes and requires a minimum of $15 a month.
However LookSmart does have one bonus that the others don't, that is link popularity. Being listed in LookSmart gives you incoming links from LookSmart itself and from places that use LookSmart's directory (such as AltaVista).
Reluctantly I am forced to recommend LookSmart's PPC program. The fact that it is the only way for a commercial site to get into MSN's primary results adds tremendous value to the program. Plus the link popularity is a nice bonus, and the most you'll be paying is 15 cents a click which should be manageable for most commercial sites.
Really you should try all three programs for yourself, you might like one better than I did. In fact I still use all three programs, however I do view the LookSmart program as being the most useful, followed by Google and with Overture in last place. The biggest reason is simply because LookSmart can get you in MSN's primary results. The other places can be easily gotten into for free, sure you might not be at the top but you can get listed for free. As long as the only way for a commercial site to get into MSN's primary results is through LookSmart, Looksmart will remain well worth it.