Only ever had one email on this subject from a vistor, they were under the impression that Google vetted teh adverts and teh products before the adverts appeared.

So they thought it was really safe buying from these firms, point of the email was is that true?

So a visitors view of things could be quite positive, although I suspectthat if you do them in your link colours callers wont notice its an advert

When I first noticed this years ago, I thought that the site had some kind of affiliation with Google. I didn't know much about the web back then.

I've learned quickly.

I do not mind the Ads by Google but do not like the childish Ads by Gooooogle.

I just wish G would give us the option of where it goes, above or below a skyscraper etc.

Or even better create a scenario by which we could choose to get rid of it all together.

Actually, the only placement where I find it intrusive is in the Leaderboard format where the space between the bottom of the ads and the "Ads by Google" is enormous. Makes the ad unit stand out like a sore thumb.

Which may be the point of course, but for those of use who have some kind of aesthetic connection with our web site, it's an eyesore.

I saw, what must have been a premier adsense site, which had the "Ads by Google" at the top left of their leaderboard, right on top of the ads themselves. It looked much more compact.

The positive side is visitor would think the website (with ads from Google) is credible enough since Google is wide known big company.

Most visitors think, my website is associated with the companies advertising. They send me mails asking me to procure products these companies are offerring. They seem to think, that, I have some sort of an arrangement with them and can get them big discounts in product prices or delivery charges!

bouncybunny has a good point
(did I just say bouncybunny?)

the "Ads by Google" needs not hog an acre if empty space, ad performance and the looks would improve tremendously if this waste is reduced.

What goes into the minds of our visitors when they see "Ads by Google"?

according to Google: Hopefully they don't
You see, Google reminds me of an old girlfriend, giving confusing signals, blend, but keep it honest with a label, make it part of your content while keeping it separate and distinct, but blend and we'll give you an ad unit that looks like search results, but label it, but we'll give you a link unit that looks like your site navigation.. What?

Worth adding: That girlfriend was dumped for better earning networks.

If average users notice the "Ads by Google" line at all, they probably think of it as meaning exactly what it suggests: ads that are supplied by Google.

I'm happy to have the line visible and noticeable, because I don't want my readers thinking that I'm responsible for the ads. If an advertiser gains credibility by having ads displayed on my pages, that's one thing, but I'd just as soon not lose credibility if someone sees "SudsBuddy Beer Cooler" displayed on a page about Munich's Oktoberfest or an ad for "Rome Ringtones" on a page about Italy. Plus, if John and Jane Doe book a cruise to the Canary Islands through an ad on one of my pages, I don't want to play customer-service agent when they've got a question about their cabin or want to request low-salt meals.