brinked - 5:01 pm on Feb 21, 2010 (gmt 0) [edited by: lawman at 12:38 am (utc) on Feb 22, 2010]
Google will not penalize a site for poor backlinks. That is because google has another word for this...its called filter. Your website will not be banned from google for buying links, or lose all your PR...thats googles definition of a penalty. But if googles algorithm or manual reviewers detects a suspicion of paid links...you might be very well be FILTERED.
Here is the perfect example...Years ago I owned a myspace website. It ranked top ten for 4 very competitive keywords. I wanted to go after the #1 spot of course so I tried a site that places your link on many different website pages. I did 100. The links were placed (with varying anchors) on 100 different pages on 100 different domains with a PR of anywhere from n/a-3.
In about a month, my site dropped to the 10th page of google for every single keyphrase I was optimizing for with this link campaign. I couldnt figure it out at first. Then I remembered the link campaign...I cancelled it and I kid you not less than a week later my SERPs were restored.
This is just one example. I have MANY experiences just like this.
poor quality backlinks especially in bulk will more likely hurt a new website than it will a well established one.
BTW I buy backlinks every day, I pay google to run my ads, and some of those visitors have websites who decide to link to me. I pay an SEO company to create stupid nonsense viral campaigns just so people can talk/link about how stupid and/or funny it was.
I pay writers to write controversial blog posts so people will link to it. So yes, I buy links in many kinds of forms.
[edited by: lawman at 12:38 am (utc) on Feb 22, 2010]