I have seen numerous threads of late that attempt to play links and content against each other as if one is more important than to other. With that in mind, and lots of time in the woods to think I offer this.
World Wide Web - A system of Internet servers that aggregates documents (webpages and other various file formats). The documents are formatted in a language called HTML (HyperText Mark-up Language and similar types) that support links to other documents, as well as graphics, audio, and video files. One can jump from one document to another simply by clicking on hyperlinks... and
Hyperlink - An image or portion of text on a Web page that is linked to another Web page, either on the same site or in another Web site. Clicking on the link will take the user to another webpage, or to another place on the same page.
Content and links working mutually together.
Link development is extremely important but also a game of tradeoffs (again) when considering "ranking". This topic isn't about PageRank (PR) or Link Popularity as both tend to cloud the issue of the "why" linking is important?
There are two primary considerations here which we will cover separately.
Internal Links - Website Link Constructs
Internal links tend to be the binding of a website (if looked at from a perspective of a book). When viewing this from a ranking vantagepoint the single most important point to remember "left to right, top to bottom". Your most important website link should be as close to the upper left corner of your webpage as possible and the least important towards the bottom right.
Not an easy task/challenge in eMarketing since the website is often developed without your expertise and the link structure isn't always flexible enough to redevelop (cost effectively).
The logic of this progressive importance is quite sound (admittedly however sometimes not practical). An easy way to determine the most important links is by prioritizing the website according to which page(s) have the most to the least internal links to them. Pages that have "more internal links" receive more weight and relevancy from within the website itself - and stand a better chance at ranking ability than pages with few links to them.
Conversely - a websites top level pages tend to be broader topical pages needing much more to rank - and not normally those that actually produce "sales" (if sales is the objective of the website). Just the same - sales pages (also called money-makers) tend to be far more focused on narrower topics - and as such do not need a ton of links to support their ranking ability.
Often the mainpage (homepage) has the most links thus in practice should be available in the upper left corner... many times the remaining pages can be positioned inappropriately and as such potential consideration when optimizing.
It is also worth noting that "a link" gains weight from what is positioned around it... thus strategically if a "home button" is the single most important link to say "computers" the next adjacent button would gain weight and relevancy by being in close proximity, and progressively adjacent buttons (links) receive similar weight and relevancy consistent with their topic breadth. If (as an example) these are "Contact Us" and "About Us" the website may not be getting the necessary boost from internal resources (dependent on the actual page content of the "link to" page).
Nav Bars and Breadcrumbs
Beyond the value offered to visitors for ease of navigation breadcrumbs tend to "weight" your website pages appropriately and one reason why directories and forums tend to be relatively successful in search engines for a wide range of topics. For the sake of argument WebmasterWorld forum 12 "Link Development [google.com]" ranks #1 & #2 in Google against major competition and not because there is vast assortment of external links pointing to these physical pages but because of the website's internal breadcrumbs.
If for example a page has been developed to it's maximum potential (ranked #1) while other adjacent pages have not, there is likely extra weight and relevancy being lost on a page that is potentially far superior (ranking wise) than the competition.
Link Anchors - Text / Images
The link anchor is by far the single most important benefit in developing ranked results for a very simply reason -- it is the bridge of "content" from one page to another page. I term this "content" since the link itself on the "linked from" page is simply extending some form of topical discussion.
External Links [webmasterworld.com]