Paid links are backlinks that are acquired by giving someone "something of great value" that are "dofollow." Simply put, this means that you are giving someone something of value (usually money) to get a link on a site that passes SEO value to yours. This is a big no-no in the eyes of Google.
Side note: there is no official "dofollow" attribute and naturally, all links are dofollow unless they are modified to be nofollow.
When not breaking Google guidelines, link placements that are paid for are called paid advertisements. These type of links are advertisements on other websites that have the "nofollow" attribute added to the link code. Nofollow means that the backlink will NOT pass "link juice" to the other page to influence its ranking.
The biggest issue that Google has is paying for links that pass SEO value because of how the link is created and flows back to a site. Watch this video to learn more.
As Matt explains, "something of great value" can be best understood reviewing the Federal Trade Commission's (FTC) material connection definition. The FTC is also very specific on material connection disclose requirement for influencers. You can read more about it here.
Not at all. Advertising on another website is not against Google's guidelines as long as the link is "nofollow." Nofollow links are typically found in paid ad placements on other websites and do not break guidelines because they DO NOT pass "link juice" to the other website. In the SEO world, "Link Juice" basically means that the site pases SEO value via the link to enchace ranking.
If you are paying for link placement through link farms and using Black Hat SEO tactics you run the risk of a penalty. If you may for a link that is "dofollow" that link helps your sites ranking by manipulating search results instead of naturally earning links. Paid links that are "dofollow" break Google's web spam guidelines because they are considered deceptive, manipulative or abusive.
Here is some more info about paid links from Google:
nofollowon such links.
More information on Google’s stance on paid links.
On Monday, July 26, 2021, Google released an update to be more effective at identifying and nullifying link spam more broadly, across multiple languages. The link spam updates targets sites taking part in link spam and not following best practices. Websites participating in black hat practices will see changes in Search as those links are re-assessed by Google's algorithms.
If you a message in Google Search Console (formerly Web Master Tools) saying that Google has taken targeted action against unnatural links pointing to your site