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Two links:

 http://www.example.com 

<a href="http://www.example.com"  rel="nofollow">http://www.example.com</a>

Now which one will be counted as backlink for my website( in turn increasing the seo value)?.

Please don't say that form-1 is useless since this is format in which our website will be listed in profile links and such profile links are being sold by many link building websites for as low as $8 for 5000 profile links. Also for example facebook favorite too is stored in url format.

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Hi, format 1 isn't a link, it is just a url. Is this what you are meaning? And Format 2 has rel="nofollow" so that some Search Engines won't influence the link target's ranking in the search engine's index. –  Digital Essence Mar 23 '11 at 10:30
    
Why so many sites are selling backlinks for form-1 then? –  user6283 Mar 23 '11 at 11:03
    
Once the search engines find a way of spotting that link building websites are being used then their seo value will go down anyway. –  paulmorriss Mar 23 '11 at 11:07
    
You would be better spending the money writing good informative content that users want to read then they come and so will the backlinks and rankings. –  Digital Essence Mar 23 '11 at 11:14
    
paulmorriss even google allows adword ad by such companies. –  user6283 Mar 23 '11 at 12:47
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1 Answer

1) Sold links either have no value or will have no value when Google finds out those links are paid for

2) The site selling those links will be penalized if they do not use rel="nofollow"

3) The first one is ot a link but merely a URL as plain text. If there is no <a> tag used it isn't a link.

4) The second example has no SEO value because rel="nofollow" is used

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Do you mean the first one is like a lost word in a page which SE's pay no attention to? –  user6283 Mar 23 '11 at 12:50
    
They pay attention to it but it's just like plain text. It's content and all it really does is help the page it is ion rank well for any text contained within that URL. It has no link value and does not count as a "vote" or pass PR. –  John Conde Mar 23 '11 at 13:10
    
Then why do spammers spread everywhere in yahoo answers, website comments irrelevant urls which they know nobody will click - only to be found by SE's? –  user6283 Mar 23 '11 at 13:29
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Because spammers do lots of stupid things. Lots and lots of stupid things. They don't want to work hard and will do whatever they think will help them out no matter how wrong they are. –  John Conde Mar 23 '11 at 13:37
    
@Job A lot of the time they have written a script which is submitting the link, without checking what the site does with it. If you write a bit of code which removes the link, they lose the SEO value, but their script continues to submit anyway. –  Blowski Apr 30 '11 at 12:49
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