People have been buying links for years and this is because links have always been such an important part of the search ranking algorithms in the past.  It has been said that if content is king, then links are queen.  They are equally just as important because what good is great content if no one can see it or find it?  Links from authoratative and high traffic websites can really bolster ones marketing efforts.  A few good links can easily increase the ranking of ones website for one or more keywords.

Now, theoretically, one should earn these links by having others use and read your website and then naturally link to it because they like it.  Unfortunately many SEO (especially black hat SEO) afficiandos have abused this link strategy by buying links and this can be easily evidenced when you see crappy websites outrank far better websites.  Well, this actually hurts the search experience and makes Google, Yahoo and or MSN less effective.  Google has taken a stand on this and has added a feature to the Google Webmaster tools wherein one is actually encouraged to turn in those that buy links.

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Now are all paid links bad?  Not really, as some are just solely for advertising and Google knows this so they added the donotfollow tag so webmasters can block the Google bot and pagerank flow from pure advertising links and such.  According to Google, if you use the donotfollow on external links you will not be penalized for paid links.  On the other hand, from open forum discussions over the internet, if you use the opposite (the dofollow) tag and are caught, the penalties could be more severe - like complete loss of pagerank or even being dropped from the search index altogether in more extreme cases.

So, yes, links will give you more traffic, conversions, sales, etc..., but its how you get them that counts.  It is still better to use your noggen and create great content.  Everyone craves great content and it will earn links naturally.  The better the content, the more the links and traffic you will get.  Then there's linkbait - the holy grail of content and website marketing.  Linkbait is simply awe inspiring, earth shattering and truly terrific content that just spreads like wildfire.  Some linkbait articles have been known to receive well in excess of over 1,000,000 page views in a very short time. 

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The point here is to earn your links naturally so you don't get penalized or banned by the serps.  Who needs a 30, 90, 120, etc... penalty which kills your traffic or a complete loss of page rank?  Instead of cheating and gaming the system, set out to provide solid content and you will earn many links and eventually outrank even the most rampant of paid link abusers (besides, they will eventually get caught and lose rank).