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Let me know your feelings on this subject.
I have an online course about widget programming, and the other day I accidentally discovered (never bothered to look at it before) how many sites are linking to me. These are all sites that volunteered to link; I never asked them (except for the ODP, where I submitted, once).
So which is king? I think a better analogy would be King & Queen - they rule together.
Link building is very important but dont go for reciprocal links.
Search engines consider sites with more incoming links as more relevant, since it indicates that more people are interested in linking to your website. Thus, search engines give sites with more quality links a higher ranking.
search engines also scan the site linking to your webpage for its content and relevance to your category.
Content is also of same importance. Your site should be content rich. The content should be relevant. Your site should have some great content or some good tool or something which creates unique value(UV) for visitors. Good content will automatically help in building links with other websites.