- For clarity, we have to clear up the misconception that a nofollow link isn't valuable. While it's true that Search Engines don't follow a nofollow link, keep in mind that real users can click a nofollow link in exactly the same way that they can click a normal link. And this is tremendously valuable of course, because we're building our website for users (or at least we should be).
- The second thing is with respect to paid links. Paid links are totally fine with Google as long as they don't impact Search Engines which means using the nofollow tag. Cutts also recommends using a human-readable disclosure on the page to let users know that the link is "paid or purchased", but this seems to be more of a recommendation vs a requirement.