Webmasters should use "nofollow" when they do not endorse the link. So a paid link does not have to use "nofollow", however, to say the issue is contentious is to put it mildly. IMO, this should be up to the webmaster not some SE! It isn't a given a blog should "nofollow" comments but they are responsible if they becomne a blogspam target. Webnaut is moderating his so... why should he "nofollow"? Webmasters should be deciding this not SEs! If you are selling links by the lb. then you deserve to get what you get, clearly not all paid links are vetted, no vetting-> use "nofollow" or you'll screw it for everyone who does!

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Follow me on Twitter! On the Trail with SOSG How I became a Social Media Convert and Twitter and Agents of Influence and now regular poster at Cloudmixer where We're Mixing New Media Ideas.