QUOTE(Jill @ Dec 13 2005, 06:07 PM)
But they didn't say they'd penalize your rankings if you don't use nofollow on your paid links, did they? If they did, then that's another story.
No... not yet, only that they would not allow them to count as a vote or to pass link popularity. They (Matt) also seems to indicate that a site selling links will lose its authority to give reputation.
From Matt Cutts Blog:
However, link-selling sites can lose their ability to give reputation (e.g. PageRank and anchortext).
Of course we have already seen Google doing that for some time now with select sites so that is really nothing new in an of itself.
I can't see them penalizing sites for selling links. If they did, what would that do to the relevancy of their results when major authority sites that sell links are no longer part of the SERPs?