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This is bad news for blogs making money selling text links. According to reports, Google is dropping PageRanks of sites which are selling paid text link ads without using nofollow. It is also penalizing sites that write sponsored posts.

The current PageRank delay in update had led to speculation that Google might be doing away with PageRank altogether because of the abuse and manipulation of ranking through practices including selling links. However, it is now clear that Google has instead taken drastic steps to clean up PageRank manipulation.

While Google is not against text link advertising, they do not want sites passing link juice to advertisers. Matt Cutt’s comment on this issue:

You want my links for traffic.. totally fine..just don’t make it so they affect search engines..so that’s why we say use nofollow..or use a redirect which is through robots.txt

Paid links that affect search engines (whether paid text links or a paid review) can cause a site to lose trust in Google.

More high and low ranking sites throughout the blogosphere, including John Chow have reported seeing a drop in PageRank recently now that updating is indeed being carried out. There is a PageRank bloodbath happening.