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Link Farms is a very old SEO method. It was first introduced to take advantage of Inktomi back in 1999. Link Farms takes advantage of search engines giving better ranking to websites with more backlinks pointing to them, which makes link farms very useless these days to help your SERP’s rankings, however they are great for getting spider traffic to your websites and create a fake PageRank.

In the good old days, people exchanged links between blogs. They used services to help manage everything. But these days most blackhatters make there own link farms, mostly consisting of splogs. Its not unusually for blackhatters to have hundreds of websites within their blog farms.