In a very controversial 2007 decision, Google took the unprecedented move of dropping the page rank of websites that displayed text-link ads. It didn’t just affect bloggers; large news websites such as the Washington Post were affected, too.
Back in 2006, it was common for advertisers to purchase text-link ads on blogs. These could be in the form of sponsored posts, or they could be simple text links in your sidebar.
Advertisers bought text links for two reasons: Links, of course, drove traffic back to their websites, but they also helped the advertisers to get better search engine rankings. In fact, the better your Google Page Rank, the more you could charge for a text link.
Google’s Page Rank is reflective of the weight that the company places on a website in its search engine results. A higher page rank would mean that you would generally appear higher on the result pages. Links from high-authority sites boost up the page rank of the site being linked to.
Google reasoned that it didn’t want paid advertisements affecting its organic search engine results, and implied that continued use of text-link advertising would be penalized. The 2007 decision caused a big commotion and a lot of resentment, because if you wanted to maintain your position on Google’s search engine result pages, you had to get rid of your text-link advertising.
Many people believed that Google was unfairly forcing people to buy Google’s ads rather than ads from other publishers.
The affected websites were forced to make a choice — either lose their text-link advertising revenue, or risk keeping it in place and call Google’s bluff. The Know More Media blog network chose the latter. The size of their network and amount of text-link advertising they sold would have made it a six-figure loss of monthly income.
They didn’t really think that Google would impose that much of a drastic penalty on their quality, well-established, and trusted network. Unfortunately, Know More Media lost the gamble. Google dropped all of their blogs from its index, and the network lost millions of page views overnight. Without that high volume of traffic, Know More Media was unable to sell advertising anymore — and went out of business.
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Source:http://www.dummies.com/how-to/content/google-drops-page-rank-for-bloggers-displaying-tex.html
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