Hi, Why is it Google son't penalize paid link directories, when they penalize other sites for selling links?
Because google is happy with them if the fee is for the advertisement or review of a quality informative website. Other sites sell links irrelevant to their content purely to manipulate googles alogirthm
Paid directories recieve a fee for the process of reviewing sites submitted and listing the said sites for the consumption of the directories users, properly reviewed and categoriesed . The users of paid directories include people and all the search engines, ergo , Google is itself a direct beneficiary of the directory review process, insofar as its done right.
Yes, Google has benefits from good directories, because they help in categorize the sites better, you can see that with "related:www.domain.com" searches.
Web directories are useful for visitors, and most web directories charge for review fees, and those who don't and some that may have been mistaken, are most likely penalized by Google.
But Google penalize Paid link directories!, not to all the directories at the moment, but there are some directories penalized with a visible pagerank drop (tree of my directories are penalized now )..
PageRank is not the only parameter to evaluate the quality of a paid directory & I think that Google cannot answer why was Yahoo not penalized