The No Follow Attribute
There has been a great deal of discussion in the SEO world recently concerning links in general. However one particular aspect of linking that has brought particular attention is the issue of paid links. Essentially “paid links” describe a site that links to you because you have paid them to do that. Linking can primarily be boiled down to some general categories;
Natural one way links; This is a link that is placed on a web site because the web master genuinely feels his visitors would benefit from it. So if your site was about baseball and you were commenting about the Boston Red Sox, “The Red Sox look to be the team to beat in the AL East this year because of their talent laden roster”. You might make the term “roster” link to the team’s page that lists the roster;
“The Red Sox look to be the team to beat in the AL East this year because of their talent laden roster”.<a href="http://boston.redsox.mlb.com/team/roster_active.jsp?c_id=bos
">roster</a>.
This way visitors could jump right to the page and check out the roster.
Another way links come about that you’re probably all familiar with is by participating in “link exchanges”. This entails you placing a link on your site to another site, only if they maintain a link back. This is called reciprocal linking and was extremely popular and effective but as with many effective techniques it appears to be less effective these days.
Another linking method is by participating in paid directories such as the Yahoo directory, Business.com or The Best of the Web, (BOTW). In this situation you pay an annual fee to have your site reviewed by an editor and then if it is found to be a quality site you are listed on a page in the directory, resulting in a link from that page to your site.
We know that linking is the dominant factor in how your site may rank in search engines so often webmasters are focused on obtaining more and more links. The central issue is how do the search engines feel about these various types of links. One thing we do know is that it is not a free for all (like the good old days) and they definitely do in fact frown upon certain practices. In short, they do not want an “artificial manipulation” of their algorithms which would result in your site gaining an unfair advantage. The goal of every search engine is to return a set of results that meets the searches query. Not to return the sites that has massed the most links through any means possible.
So, how does this relate to the issue of paid links? Well we do know that Matt Cutts, a Google representative, has made rather clear remarks indicating Google does not condone buying links for the purpose of manipulating Page Rank, and ultimately where your site ranks; http://www.mattcutts.com/blog/text-links-and-pagerank/
In addition Google has updated their web master guidelines to reflect further comment on this; http://www.google.com/support/webmasters/bin/answer.py?answer=35769
So, the question still exists; is it ok to buy or sell links? The best we can gather is Google does not want webmasters buying and selling links for the sole purpose of improving their rankings. However, what about basic advertising on a site, with the banner or text link taking someone to another site? That’s linking; to protect oneself from appearing to buy or sell links the “no follow attribute” should be used. Basically what this does is tell search engine spiders, i.e. Google that the link is NOT a vote in favor of the other site, but merely a business arrangement. The link does not indicate that you feel strongly about the site, or that you even think it’s of any value. The “no follow” attribute negates any of that.
So in our above example if the Boston Red Sox were paying you to drive visitors to their roster page you would link in this manner;
“The Red Sox look to be the team to beat in the AL East this year because of their talent laden roster”.<a href="http://boston.redsox.mlb.com/team/roster_active.jsp?c_id=bos rel="nofollow
">roster</a>.
so, if you find your self in a situation where there will be an exchange of money for placing a link on your site to someone else’s, you may wish to bring up the no follow attribute and see how the buyer responds.

