Why online marketers and webmasters alike avoid linking out to other websites?
There are numerous website owners who feel like they're doing themselves a disservice by including outbound links to other websites. The fear is that they will somehow lose their Google PageRank by doing this.
Some believe that outbound links will add little, and will be at the expense of inbound links. Their arguments are along two lines: the argument that outbound links "drain" PageRank; and the argument that the massive reciprocity of all those sites you linked to will result in enough inbound links to cause Google to think you're using "black hat" techniques. Neither of these are true.
1. First, outbound links do not somehow cancel out the good that your inbound links do you. Suppose your Google Toolbar PR is 4. And suppose that one page on your site has 8 external links. That will not harm your PageRank.
It might help someone else's PR, but not at the expense of your site. The amount of PageRank "juice" you're giving a site you link to is equal to your page's PR divided by the number of outbound links on that page. So, PR 4 divided by 8 outbound links means you're giving your link-ees 0.5 units of juice, which is a little like positive karma.
This logic applies also for internal links and the link juice they carry between your own pages.
2. The argument that if you have outbound links the resulting flood of reciprocal links will make Google think you're using nefarious tactics has little truth to it too. First of all, you should be linking out to sites that are relevant to your page's niche.
These sites might give you a back link in return, and that will only improve your rankings. If you're linking to good, non-spammy, non-link farm sites, reciprocal inbound links will not harm your PageRank.
To ensure that your outbound links don't cause problems, build reciprocal links by exchange of articles, and keep the outbound links spread throughout the body of the page. Don't build a "links" or "resources" page full of outbound links because are not well seen by Google, thus they will be of little use to increase your site's PageRank or ranking power.
The more your site is considered a useful provider of content, the more that the high-quality, relevant outbound links will help you. While it may seem counter-intuitive to be giving other sites extra exposure, the truth is that you will often pick up enough high quality inbound links to keep your own site's exposure high, resulting in more pages from your site ending up on social bookmarking sites like Digg and StumbleUpon.
So what constitutes a quality outbound link that can actually help your PageRank?
In many cases it would be outbound links to sites that themselves have decent PageRanks. The key is, those links must be relevant to the information on your page. An article followed by a laundry list of links won't do much if anything for your site.
You should strive to link to good blog posts in blogs that are relevant to your subject matter, reference material such as newspaper articles you used to write the page, and links to content that goes beyond the level of some of the content on your page. Such sites are relevant to your content, but not necessary for making sense of your content.
Links to sites that end in ".edu" or ".org" are very beneficial, and back links from such sites are valuable because these sites have in general this non-commercial feel and are not building up numbers on the hit counters.
Links to sites that are controversial in your subject matter area can benefit your site, as can links to directories like DMOZ and Yahoo Directory. Links to sites that do well on the search engine results pages - assuming they are not your (direct) competitors - will help your site, as will sites that are considered authoritative in your niche.
While it is not strictly necessary to have outbound links in order to improve PR, they are not harmful as some people say they are. Outbound links to sites with high quality content that is relevant to the information on your page is almost always neutral or positive for your site's PageRank.
Connections between good sites benefit everyone, and the engineers who write the ranking algorithms know this. Linking out doesn't "drain" your site of authority, nor does it get you tagged as a spam or black hat SEO practicing site. You don't have to be afraid of outbound links harming your site's reputation, instead turn your site into an indispensable referential platform for your niche market.
If you're currently building an online business, you probably agree that the blog is the website of choice to give you huge exposure in the shortest amount of time; plus, it offers the perfect environment to improve rankings by linking out to related weblogs or sites, as discussed in this article.
Back on my personal blog I've recently posted a two-part article where I lay down a complete walk through on how to build SE friendly blogs. Please, give it a read and tell me if it's useful and what aspects I've overlooked or treated superficially.
