There is a discussion at WebmasterWorld titled It’s Official: Google Discounting Reciprocal Link Exchanges and there has been quite a bit of buzz going around about this story. I’ve seen multiple comments about Google “officially” discounting reciprocal linking and so on. I’m not sure why all the discussion is about reciprocal linking. The post from the Google Webmaster Central blog that they are discussing isn’t about reciprocal linking, it’s about how they are trying to detect paid links algorithmically and new ways to build link popularity by using link bait. Reciprocal links have long been discounted and have not been a mainstream SEO technique in a very long time, unless you’re one of these geniuses.
Link bait is a great link building tool, however I don’t see that much potential beyond the tech world. It will be few and far between when a company can write a great article or build a cool AJAX tool on grass seed that will be on the front page of digg. Manipulation of social networking sites will only continue to grow. Will Google start to discount links from these networks as well? Soon enough the only links that will count for anything are going to come from YouTube, Sun, and other Google partners.