My website rank number 6 for a keyword. Over me there are 3 websites that buy textual links. If I report to google one link they are purchasing, then will they lose their positions? Or google will use my report only to tune its algoritmic?
My personal opinion is that they will only take direct action if it is a really good link, meaning that it is a link that is very hard to detect. (Or, if it is brought up in a highly influential publication, like the New York Times).
Most of the spammy links seem to NOT get penalized. MOST of the spammy links seem to just get ignored (hopefully) by google.
The sites that I have seen that have been penalized had a few links that were on sites designed specifically for placing paid links. They had articles that more or less made sense, and then an in-content link that seemed out of place (and also had exact keywords anchor text).
Note: This is only my opinion and it is based at looking a only 5 sites that have been penalized. Those who have looked at numerous sites might have a different opinion.
Ideally, you want to get a better link than the three web sites that rank above you. And yes, go ahead and report them to google, but their is no guarantee they will do anything.
I don't even know if they truly penalize or if they simply disregard the link values.
I've heard other webmasters saying they had great success notifying Google about them. However, I can't say the same. I have reported a number of websites and none seem to have had any effect whatsoever.
They claim that they use it to change their algo. Bear in mind that by contacting them you may also be bringing the sites that you have listed in WMT to their attention. Are they whiter than white? If not your complaint may backfire on you.
It's easier for Google to penalize a website selling links, but difficult to penalize the ones buying the links. People could just buy links pointing to their competitors website in the hopes of getting rid of the competitors, and some people have tried that. I think it is more logical for Google to just ignore links they suspect were bought, and penalize the ones selling the links.
I think webmasters should stick together and not 'out' each other. Taddling on people to daddy Google is lame. Worry about your own sites and not others. If I tried telling on all my competitors for buying links I wouldn't have any time left for improving my site and my users experience.
In answer to your question "What benefit do I get from reporting paid links?" I'd say the risk in getting your own sites manually reviewed would outweigh the effect of getting paid links devalued.
If someone asked the same question 6 years ago, they would have been bombarded with abuse. People have always bought links for marketing purposes - it's not against any laws to spend advertising dollars somewhere other that google.
Personally, I don't think reporting paid links will do anything which could benifit you. Unless as someone already mentioned, the links are designed to fool search bots (hidden for example)... in this case then google could penalise them (perhaps).
If you site is clean (I am assuming it is), then why not?
Yeah, some people might call you names that are usually brandied about by third graders. They are (probably) the same types of people who regularly buy links, which would explain there disdain for those who would like to see the google SERPs free of spam.
You WOULD be creating a benefit for users, because honestly, they don't want their search results cluttered with the same companies over and over again.
And also, if you report them and NOTHING happens, well, at least you will know what you can get away with in the future should you decide to emulate them :)
Google is not so much interested in banning individual websites for buying links, as in creating algorithmic filters to detect them and devalue them automatically. Therefore, reporting individual sites will benefit you very little, if anything at all, but it may bring your own website(s) to their attention. Just recently I have watched two major competitors bite the dust and both of them had stacks of links from spun pages; I wouldn't be surprised in the least if the panda is learning how to recognise these.
I decided to report a website that use auto generated text and it is at the top of the ranking. Its text is no sense. I went on google webmaster tool, but I cannot find a way to report auto generated text. There is a page [google.com...] where you can report paid links, phishing, malware, ... and if you choose "Something else is wrong" trying to report generic spam, it redirects to the original page. Can someone help me how to report such kind of spam?
I agree with Planet13. A lot of the times you see a lot of junk links being indexed or in seomoz or another link checking tool, but none of that really confirms that link juice is being passed. With really spammy ones I wouldn't worry about it.
I personally wouldn't report another site. It's frustrating sometimes that we have to always bend to Google's will. I'm not saying I do black hat, but everyone here knows they have gotten a link or two in a way that Google wouldn't approve. I sort of look at it from a karma perspective. Although I'd love to outrank some competitors, I could just as easily get reported for even a minor case and have to deal with a manual review.