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I don't post SEO/search/webmaster videos here very often, because this is my personal G+ account, but this is an in-depth (8 minute!) video that explains some of the criteria we use when we decide whether a link is paid or not. Roughly, here are some of the important questions we ask:
- What is the value of the gift, product, or service?
- How close is the gift, product, or service to actual money?
- Is it an outright gift or a loan?
- Who is the intended audience?
- Is the intent of the gift to get links?
- Would the gift be a surprise to third party?

My guess is that anyone who has been involved with SEO for a while would intuitively understand these criteria, but it's helpful to clarify some of the questions we ask. Bear in mind that well over 99% of the time, paid links that pass PageRank are abundantly clear--because actual money is changing hands--plus we reserve the right to adapt our criteria when we see new types of spam or abuse.
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excellent post. Really clarifies some points. Its kind of putting a nail in the coffin of seo spammers with bad links. However, they always find a way and legitimate people still suffer, so i wonder how the murky water will become more clear in the future.
+Matt Cutts Thanks for sharing this. How does the Google Web Spam Team know if money or goods have been given for a link? Are you guessing or checking credit card records? Do you just look at the relevancy of what the writer says about how or if they received compensation?
Thanks +Matt Cutts - we get so many questions relating to this topic so it's  great to have a reference ;)
+Matt Cutts Hey,  what you doing this Friday night? Invite you for a beer, pizza & a ride in my Ferrari... :O) . Thanks mate good info!
Thanks +Matt Cutts for sharing this on G+. I'd love to hear more from you and your team here!
These are generally pretty good and informative - however I have noticed that the majority of these topics, and guidelines in general, are very much focused around blogging and review sites. What about e-commerce?
It is gratifying to know that google knows nothing is free. Sometimes I doubted
+Matt Cutts how in the world could you catch someone selling links if they made a deal in the real world? If you are not sniffing Gmail, how is it even possible to detect?

Let's say I wanted to buy a link from someone in the same niche as my web site. I could simply call the guy and give him instructions on how to implement the link naturally into his own web site (no commercial anchor text whatsoever). How could you detect this? Please tell me.
thanks mat for explaining  in plain English,cool shirt next time your on TWIG you should wear it. represent............
What happens then, when I get paid for a link? Is that bad, if that link is related to the content of my website? Do I get punished?
And same question as +David Caron. How does Google know?
What happens, when I write an article first and then I get a gift because somone likes that article so much?
I understand that you only take suggestions for topics through twitter. I would like to comment and ask an explanation on the following concept. 
Assuming someone pays another webmaster to host a link to their web-page, why that would be considered negative since it is a very basic form of advertising done even by google? Adsense places links and content on other web-pages for money but why is it looked negatively in the rankings if someone does that outside the Adsense concept.
There it is, the shirt that I want so bad I might have to have a screen printer copy it for me.... You have my envy once again Matt
A problem is when spam sites just put your link on their site on their own and then will not remove.
Well why would you do that if you intend to advertise and the crawlers would follow the natural flow of visitors instead of restricting them. It would give more accurate search results and in addition it would advertise to users. 
+Iordanis Nofollowlinks links prevent page rank from passing. Google's guidelines state that paid links must not allow page rank to pass. This is a means to prevent (even more) widespread manipulation of links to rank higher in Google.

It has pretty much always been this way, accept it for what it is, and decide for yourself if you want to follow the guidelines or not (but be aware of the risks if you don't.

Worth noting that good paid (Nofollow) links aren't worthless just because they don't pass page rank - they pass something even more valuable, namely qualified visitors looking to buy your product or service.
If your detecting these links algorithmically. I really don't see how in the world you would know of I met someone at Starbucks and bought them a a cup of coffee for link.
Thanks +Matt Cutts for your post! 

The ideal linking strategy is to link to websites you trust. A no-follow is instructing #googlebot  that you do not trust the content on that site. Why link with them at all if this is the case.

Never underestimate the value of a link if its done correctly however. Links are what connects the entire web. Natural interlinking without going overboard is still highly acceptable.

The ability to provide your visitors with answers and solutions for which they searched is the single most important aspect of search engine marketing. Minimize your bounce rate and maximize your conversions and visitor time on site and your website will do well in the search results. Simple as that.

PS - Get your customers (on and offline)to do reviews! very important
+George Farmer the only way to solve that issue is to ask for link removal (use your google account to email them to make a footprint of the email requesting link removal). After a week if nothing is done about it you simply create a text file - how to disavow a link is explained on - 

Use only for websites that link to you without permission.
Interesting, or should I say “fascinating”?

If you think this to the end, it would also mean that every employee cannot link to their company, or that their links do not have value. Wonder when that’s going to happen. +Matt Cutts , is Google devaluing links based on employment by that company?
I thought most of what Matt was really vague. I understand what he's saying but even Google can't interpret whats not said (written)

The reality of this world is you don't express something unless it's something you're passionate about (positive), bad experience (negative) and lastly, for financial gain (positive or negative doesn't matter. net positive for financial gain)

What he said makes sense if Google's watching you in the real world making these agreements.

But other than that, most of the video I was thinking "how the hell would you even know the motives behind those links/reviews etc"

If your link/review is in the context of your site's "topic", and you don't explicitly write that you got this "Great stuff sent for free", how would they know? (also not a plain review site saying "buy this here now", filled with these kinds of review posts on very different topics)

And most reviewers I know of, don't announce to the world that they were essentially paid off. But most of them do get some benefits. 
+Victor Jonsson The thing to remember is that Google's the inspector performing the sniff test. Google gets to decide what smells rancid and what smells fresh.

Realistically, Google isn't going to even know about most under-the-table financial or "in kind" compensation for links, but those few people who do get caught by Google's sniffers won't get very far with the "I wasn't warned!" defense.
Hi Matt

What about sites like Tripadvisor?
I paid over £600 for a business listing to have my phone number and a link to my website on that listing. Is that considered spam? 
+Jonathan Sanchez TripAdvisor business listings don't transfer PageRank (just as most ads don't transfer PageRank). When Google warns against "paid links," it's talking about conventional links, such as ordinary text links, that do transfer PR.
can I see it somewhere else? other than youtube.
This is the first video by +Matt Cutts that CLEARLY is understandable. Thanks again ...!!
+Michael Davies that mouse on the t-shirt is really distracting. I kept thinking it's my actual mouse pointer and tried to move it away from the screen
+David Caron Bad link building businesses, link selling directory's, flimsy content / press releases, irrelevant advertorials, link networks, spammer tactics etc.: they leave all kinds of patterns and signals Google (and other party's) can detect. Tracking paid link building practices can be as simple as reviewing your junkmail folder. Then there is suspicion of fraud: shady businesses usually break more rules than one, so one thing may lead to another. Often, you don't need to break the law and get your hands on private information. Sometimes, all you have to do is work with the right parties and proper authorities. Working together with law enforcement, legit companies, Google users and groups that fight spammers creates all kinds of possibilities. Think of the knowledge and experience you can gather from spamfighter groups. Google doesn't need to drag you to court, nor do they need to shut down your website. You have to realize: a strong suspicion is enough for them to work with. They probably won't focus on catching the occasional link exchange between companies. You'll usually just end up hurting yourself by damaging your website / content value / online authority / reputation if the exchange doesn't add real value to the user. And then there is paid link removal: people that create bad links and charge a company for their removal.
+Ivan Juras Thanks, Ivan, you've asked the question I really want the answer to... How would they know if the actual deal happened over the telephone? Surely they're not bugging phonelines!
You're not comparing like with like. Adsense links don't carry any SEO benefit whereas a link on your site may well do so. 
+Remco Tensen I understand what you're saying. Either way, what are the good ways? If you pay Google then you get placement on the 1st page above all organic, if you pay someone else to help rank your site better, you get penalized.
+Remco Tensen +David Caron   Algorithm for adwords, organic & adsense are completely different, Just imagine you are searching for anything, (now almost every one does seo for their site) and boom top 30 results will be all the people who paid for links :p  
It's scary to think that Google knows that I bought someone dinner or loaned them a car or gave them a laptop.  :-)
+Matt Cutts one comment that came up here several times but you did not answer: How would Google ever know that money was paid? How would Google know if I've received a beer or a Ferrari? How would Google know if I had dinner with that person???
I only see 2 solutions:
1) You were only considering people who explicitly disclose those exchanges (and Google would analyze that disclosure). Which means that you have no idea.
2) Google is even creepier than we thought, and you analyze our emails, follow us with drones and turn on our webcams while we sleep!

I sure hope it's #1.
Hi +Matt Cutts I still want to know what about when your client's competitors used link networks to build spam links to your client's website?

And the your client gets a manual action yet the client nor the SEO company that represents him has built these links?

Obviously links still get removed, disavow tools gets used if links are not removed and a reconsideration request is sent even stating these links had to be built by a competitor, yet competitors keep on doing it, and can not be traced or after numerous attempts of trying to find out who they are by emailing contact details found on such spammy link sites, yet no hope?

What can we do then?
Rob May
+charmis pala - Not much! Google and Matt are pretty cut and dry on this when profiling paid link profiles. Like it!
+Rob May that was not my question even I know it is paid links to my client site but what if your competitor paid for those links in hope of getting manual action against my client.

One can only do so many link removal requests, disavouw and reconsideration and if competitors keeps this up then penalty never gets lifted cause i still cant find out or prove who it is.
+Grzegorz Czemierzewski He was talking about links which he paid for to advertise something, to which yes he can and should add nofollow to. For example an advertorial; links absolutely should have nofollow. It's not enough to state that this article is sponsored etc.
+Matt Cutts  One item that was not in the video is the processing fee that some directories require for registering. This is usually a small amount to cover the time required to asses the quality of the business and website. I view this as reasonable since it ensures that my entry will not be surrounded by shady websites. Do you consider this a paid link?
What if it's Google that is paying for the link, e.g. if I implement Google AdSense on my website?
Splitting hairs: We use a free cms on a website which includes a backlink to the cms programmers.
We have to pay to legally remove that backlink, so in theory that backlink is paid for by the cms programmers and we should hence be penalized for providing a paid link on all our pages.
Similar, the programs and templates for CMS which require payment for removing backlinks should get a penalty for all those thousands of links without a nofollow to their sites.
+Ivan Juras they could be sniffing the other link types and traffic of the site you're getting the link from. As well as the links of others inter connected to this same site. So it would be pretty easy to deduce that you also paid for a link fi your site is added to the pool. (That's my take anyway)
+Dewaldt Huysamen I would imagine that is this is one of the reasons that Google has created the disavow tool. This is almost impossible to detect and the only way to battle this is to keep using the disavow tool religiously. We're had to do this for several clients and it's ongoing, although not as bad as it once was. 

Sooner or later the person doing this act will run out of steam and or money and karma will come back and bite them in. You can probably bet that the type of people that perform this type of tasteless act are using grey and black hat techniques. So sooner or later they'll get dinged and caught.
+Kees van der Veen Google only indexes the front end of sites code and so you have the ability to edit this link in your own code. If you're required to leave it in place for legal reasons simply change it to a no-follow link. Use this (<a href="" rel="nofollow" target="_blank"></a>) - remove brackets
+Marc Poulin yes this is a paid link and if you check the PR of the directory then you could probably see that it has dropped significantly. Directories are only good if all their link-outs are no-follow.  
great matt cutt
i hope to get 1% of your success
cf tan
I haven't got answer.
I have a suggestion to all those who keep asking how Matt and his digital Powerrangers are operating against paid links: follow @MattCutts on Twitter. Of course it wouldn't be smart of him, prevention-wise, to give away every little detail about how things work in the back-end, but you'll also learn alot about his cats.
+Remco Tensen Adsense "links" do not pass any PageRank or "link juice", or whatever you want to call it. So it doesn't matter that they are paid - they do not influence organic search results.  
Hey +Matt Cutts  has it occurred to you or the team that making it mandatory to read the Webmaster Guidelines before being able to use things like Webmaster Tools or Analytics could make things less confusing for some people?  
It seems like many people are not even aware that the Guidelines exist, and are surprised by these startling revelations about paid links, link schemes and other SEO 101 stuff.  Maybe a short certification test before using WMT or GA could help? 
Thanks +Matt Cutts for the explanation. If you send me a new Google phone I will +1 the post and do a write up on it. ;) Just kidding.  
Tengo la idea de un producto (aplicación) revolucionario para Google, que daría resultados extraordinarios en el área de redes sociales... A quién puedo recurrir?
The only way paid link policing will work is to snitch... The shirt was a dead giveaway!
+Durant Imboden  wrong, nofollow links do pass pagerank, just read carefully the google document about pagerank, there is a "hint" about that, as they play on words very carefully. I have tried to index a site with only Nofollow links and my site obtained a pagerank 1 ! and ranked 2nd on its keyword ( not something highly valuable, but that was a test ).
+John Broadbent
 well last time matt got a free indoor free fall flight and did link to it ;) he should penalize his friends sites ;)
When will you do something about blog comment spamming which still works? These aren't paid links, but there are lots of sites ranking with such spam links and you don't do anything about it.
Thanks for sharing Matt
+Brandon Downs
 actually Negative SEO over optimizes the anchor texts. There are so many companies specialised in that now, it's not even funny. I can show you 10 negative SEO right now, of honest small businesses. they went from 50 to  600 links in 3 days. ( 550 links with exact anchor ).
+Sangbaran Karmakar i would think that google have they own internal rating system, they kind of invented all of that. that is just an assomption though. + google doesn't rely on 3rd party information, they prefer to control everything, they are big brother after all ;)
+Grzegorz Czemierzewski As I stated previously, I was responding to a statement about paid for links, for which you can simply nofollow, if you're doing it from non-SEO reasons. You're asking about something different, which is links placed without your consent, in which case a disavow is comes into play if you believe the link to be spammy.
Hi matt love your videos, but linking is as clear as mud, thanks  eric roberts
+Matt Cutts  always suggests to have great content and authority sites over building links .... I ran a personal experiment for last 1 year, a site of mine actually ranks for several long tail keywords, the site has great content, and most importantly, I stopped building links on this site for last 6 months or may be more, but I regularly add high quality content on this site and I started making good affiliate sales for last couple of months .... I never claim that I exactly understand what Google wants, but this is what I do and it gives me profit and so far my that site didn't get slapped by any Google algo updates.  I spent a lot on content, but stopped spending on links. However, this is absolutely personal experience and experiment, it worked for me and so far I tried it with one site only, hope to start scaling it soon.
@Matt All those new Google penalties have not changed the lucrative world of those that do Blackhat Seo with redirect sites and stolen content. Honest webmasters who write their own content have to pay the prize all of a sudden. The world has become a weird place even when you do an online search. Youtube vids rank better than an unique 2000 words page, those algorithms have the flu should not have touched the value of exact match domains, penalizing ALL reciprocal and footer links. Those who have sites with 1000+ links in with no content and just have sites mainly to redirect users to their ads that's a great user experience. Google thank you for making life impossible for those that have nice sites with real content.
Yes, +Matt Cutts , of course you and the rest of the Google team reserve the right to adapt your criteria when new types of 'spam' (because the definition is ambiguous and subjective) come up, but webmasters can do as much in regard to Google. Not everyone agrees with Google's views of the Web world.

However, the recent insistence on a heavy use of nofollow links on pretty much any kind of links worries me not just as a web marketer and a freelance professional, but even as a computer scientist -- I'm sure you know, Matt, that every webpage is a node in the Web graph; nofollow links disrupt connections between nodes and some nodes may become isolated.

The recent action against MyBlogGuest lead many website owners to nofollow ALL (or nearly all) outbound links as a reaction to the fear your Webspam team might deem their guest posts and editorial links spammy. You can imagine what would happen if everybody starts to nofollow every link, right?

And for a change of topic, I really don't like the "rel=nofollow" attribute on paid links. Something like "rel=advertising" would make much more sense, semantically speaking. ;)

Have  a nice weekend, Matt. I just hope I provided a little bit of food for thought.
+Matt Cutts thanks for sharing this detailed video. My only concern is that new website owners who are usually not web and tech savvy will not know how to use a nofollow tag. So the nofollow tag will mostly be used by tech website owners!
Thanks for another great & informative video Matt. I was given a link to one of your youtube videos and got addicted to them. I am a new website designer/developer and I love the great info & the way you present it. It is very helpful. Keep up the great work.
.. well, if Google could define what is paid link - the video would be 30 sec long.... now we have 7min+ philosophy blathering on the topic - types of compensations for online products :/
Hi Matt Cutts, I want to know about bounce rate time duration? Is it same for all website? I am waiting your reply...
First question: Unless you are seeing emails soliciting paid links how would you ever know?

Second question: I noticed your t shirt says, "report spam". Trying to report spam to Google and see any evidence of them taking any kind of action is one of my biggest frustrations. Pick an ED drug, say one that starts with a "V". In the first 3 pages of search results I can show you at a minimum five links that are hacked sites that redirect to rogue online pharmacies. One is marked "this site may be hacked".

Guess what, I've reported at least 50 this type of hacked site to Google and out of the 500 or so Pharma hacked sites I have looked at maybe I've seen five that have been identified as hacked.

Do you think I am going to bother with reporting sites and messing with Captcha for each one just for a  thank you email with no real results?

I have a firmly held belief that the only three groups of people that cannot find spammy hacked websites are webmasters,web hosting support teams and Google's web spam team.

Yes, I am passionate about this!
What if our company is a genuine quality one , but to get an organic listing .. everyone uses links .... so if we don't have that many links , then a paid-linked guy is above us .... so basically the case is that if you cant beat them, we simply join the linking bit .... so what's your advice for that.
You ever heard of make your own links it's very easy and make own Blogs
by using other names, basically you save lot of money and time, 1 thing do know how to make my own traffic and Good traffic and that my advice to you.
so, how about "Sponsored Links"
They're trying to monetize their site through "sponsors".
is that considered as a "paid link" ??
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