In a blog entry yesterday, Matt Cutts talks about paid text links and their affect on PageRank. This following the recent debate over O'Reilly Media's right to sell text link ads on its web properties , Matt gives us some Google insight on how they view paid text links.

Here are some excerpts:

"Selling links muddies the quality of link-based reputation and makes it harder for many search engines (not just Google) to return relevant results. When the Berkeley college newspaper has six online gambling links (three casinos, two for poker, and one bingo) on its front page, it’s harder for search engines to know which links can be trusted."

"Google has a variety of algorithmic methods of detecting such links, and they work pretty well. But these links make it harder for Google (and other search engines) to determine how much to trust each link. A lot of effort is expended that could be otherwise be spent on improving core quality (relevance, coverage, freshness, etc.)."

"Reputable sites that sell links won’t have their search engine rankings or PageRank penalized–a search for [daily cal] would still return dailycal.org. However, link-selling sites can lose their ability to give reputation (e.g. PageRank and anchortext)."

"What if a site wants to buy links purely for visitor click traffic, to build buzz, or to support another site? In that situation, I would use the rel=”nofollow” attribute. The nofollow tag allows a site to add a link that abstains from being an editorial vote."

Some interesting insight, Matt. Web site owners who buy and/or sell text links will want to keep a close eye on this continuing dilemma over paid text links. You can read the entire post here.