I heard that the bad ones can ban you from the search engines.
People say it is BAD, But i will advice two things when you select your partners
[1] Be selective - Find only relevant partners.
[2] Try 3 way - It works better i think.
In terms to avoid getting banned you need to be careful about automated link exchanges.
They are not all bad, but you must pay attention, because some of them leave HUGE footprints for the search engines...
Also some are just useless because your link gets burried within "137.786" link entry mega directories within a subpage so far down the linking hyrarchie (do you spell this like this?) that search engines just won´t find your link.
If you use them, be very selective.
1. In the automated link exchange service you chose
2. In the sites you change links with. (no mega directories, only sites related to your topic, link page must be able to be reached from the partners home page, at least not more than 3 clicks away...)
All after all, link exchanging is a time consuming task, but can pay off after time!
Read Articles realted to Link Building at here:-
Link building basics for SEO
To Link OR Not to Link???
Danger from Link Farms
Types of Link Building
Benifits of Reciprocal Link Exchange
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