Google | Paid Links | rel=nofollow & Cloaking
 

What are your views on paid links on your sites? For example banner ads or affiliate links.

This is what Google says about it:
What do you do and what do you believe is necessary to avoid a Google penalty?

Do you cloak your links like site.com/out/sponsor or do you use regular affiliate links like site.com/join.php?wid=1234

Do you rel=nofollow your affiliate / advertisements?
Do you combine cloaking and rel=nofollow?

Finally, Do you inform your visitors (and Google) that there are adverts on your site?

Don't cloak, don't lie, don't attempt to cheat.

Divulge all information and all should be fine. Create pages relative to your topic. Don't stuff keywords. Don't even bold them (and I would even go as far as to link them) in this day and age. Use your verbiage naturally.

I don't think Google has anything against making money and advertising at all. I just feel that (like yourself), people think things through way too hard, which in turn ends up making your site look shady.

As far as using something such as: site.com/out/sponsor - I see no problem with that as it could be a tracking system. There is no reason for Google to penalize that unless of course you are linking to something already on their watch list.

I like using a jumpscript in a special directory which redirects to the sponsor. Then I put the directory in robots.txt as disallowed. This also gives you a way to redirect all links instantly from a sponsor if they decide to shave or shutdown. :)

If you think about it though the whole idea that we have to do anything is bullshit. We should not have to make our pages specially for search engines. It should be on Google to figure out what is a paid link. That answer about requiring machine readable text to identify the paid link just rubs me the wrong way. The next thing you know they will be declaring what is and is not valid html and refusing to index pages which don't follow their exact standards.

give it up you aren't getting your SE traffic back