AdSense is currently in the process of changing how ad units work. Modernization work was hinted at in October last year on the AdSense blog. The upcoming changes are geared towards simplification, and giving Google more space to make automated improvements over time for publishers.

This is good, namely because of one reason - Google knows exactly which ads perform well and is continuously improving creative formats. So any restrictions just mean lower performance.

Some of the ad unit types available to AdSense publishers

The big things that are changing:

• Naming - “Text & Image” ad units are a thing of the past. They're now called “Display” ad units.
• Ad types - you’ll no longer be able to select if you want images, text or both. With the fact that advertiser creatives are becoming more complex and Google Ads is moving towards an asset based creative model with images and videos (where advertisers upload multiple components of a creative and Google builds the most optimized version of it), text-only creatives are quickly becoming a thing of the past. More and more advertiser budgets are moving to richer creatives, that are really a hybrid of text, images and videos. However, if you still really want a text-only creative, you can still use Native ads in AdSense.
• Ad styles - similarly, due to the level of automation provided in Google ads, the styling provided by publishers is becoming less relevant and in most cases restricts the number of advertisers that are eligible buy ad space (since they may have specific brand colour restrictions they wish to maintain). Google is optimizing the look and feel of ads to deliver the best outcomes for advertisers and publishers. But similarly to the item above, if you really want to have customized styles, you can use Native ads (although you should expect lower performance).
• Backup ads - this change is directed more towards the users on the web who see the ads that AdSense provides. AdSense has a responsibility to protect users and not spread malware through it’s serving stack. The way the backup URL feature works means that publishers can basically tell AdSense to use any URL (which gets iframed) if no ads are available to serve to users. And as you can image, bad actors can iframe in any URL they like, increasing the risk of spam.

Some other smaller changes:

• There are big tiles at the top of the page showing you which ad units you can create
• The ad units table has been simplified. Unnecessary columns have been removed
• A much better search functionality with filters has been added
• There's now a proper creative preview for Display ad units

It’s safe to say Google is trying to do more to help optimize performance for publishers. Unrestricting their “Display” ad unit to be the best performing banner ad unit they have is just the first step, and reminded me of the remote control evolution.

Fewer buttons, more power

If you’re a passive user of AdSense, this is great news for you! If you prefer to have more control over the ad experience and look and feel of the ads that Google serves on your sites, then going with one of the Native product offerings is for you. But like mentioned above, this doesn’t always result in the best revenue outcome, so there’s a price to pay.