A Google Webmaster Help thread has one webmaster upset about someone trying to link spam their site in order to downgrade their rankings.
Even though Google has been back and forth saying bad links can't hurt you and then saying it is possible links can hurt you, SEOs are not sure what to make of them.
We ran a poll and most SEOs believe competitors can hurt you with links but still, many do not believe it. And that is the overall opinion in the thread. Most are saying, the links won't hurt, the links will just be devalued by Google.
What do you think? Not do you think they can hurt but rather, do you worry about it?
In fact, I had a case where Square Peg Web Design was so upset with me that they tried to do all sorts of things to hurt my company, including building nasty links to my site. I wasn't too worried about it, although it encouraged me to keep my post up about what they did to my company and clients.
Forum discussion at Google Webmaster Help.

Comments:
Ian David Goodall
09/06/2011 01:08 pm
I would say that it is a somewhat worrying issue. However, given the current practises of our competitors, I doubt their SEO knowledge would stretch far enough to doing it.
Steven Weldler
09/06/2011 01:55 pm
It is worrying. People who believe that Google will automatically devalue them are naive. The same company that values poor spammy sites all the time will at times have trouble figuring out who created these bad links to your page. A no-follow.txt or a webmaster tool to block links to your site would be very helpful.
SEO Generation
09/06/2011 01:56 pm
I probably won't worry so much about this. You can/should only be able to hurt a site if you have full access .. Link spammers would realise that all they are trying to do is a waste of their time. The search engines are getting smarter by the day
Carlo
09/06/2011 04:44 pm
I think the only people who really need to worry about are people competing for multi million dollar revenues. momma & poppa sites need not worry.
Guest
09/06/2011 05:10 pm
If you're competing for that much money, your link profile should be robust, and clean, enough to make these sorts of attempts look obvious.
Mark
09/06/2011 07:12 pm
Although I am a really small fry I hate the spammers that give me 404's. EG: why do sites like nike 4 shoes dot com give bad links to my pages about legends. Also a high proportion of the pathetic amount of backlinks I have on my sites are from spammers, so this must be having a negative effect for me. I want to mark them in WMT and say what they are!
Michael J. Kovis
09/06/2011 08:30 pm
I don't worry about this one bit... It is an ongoing topic, especially as of late, but I really believe that it is getting way too much attention.
Syed
09/06/2011 11:19 pm
Its not something I "worry" about necessarily but definitely something I don't ignore and is in my head. I analyze the link graph for any signs of it as I have seen this happen before. If your competitor is able/funded/motivated enough, they can definitely bring your pages or even the whole site down but as some have noted here, the stronger the domain authority, the more difficult it is to get affected.
Phill
09/06/2011 11:52 pm
I reckon Google dismisses competitors buying dodgy links to your domain. Why? Who would seriously spend money on this not knowing whether it promoted or demoted their competitor. IMO, The uncertainty works in the favor of Google.
Phill
09/06/2011 11:53 pm
If I was Google. I would invest heavily in an algorithmic solution to this problem - with that in mind, I reckon it IS something you should worry about. We will never know the truth. The same can be said for most things in life.
David Johnston
09/07/2011 03:04 am
It is definitely an issue. Google manually penalizes sites like JC Pennies and others without hard proof it's them. Google doesn't ask if you bought those links. They assume a best guess and smack you into temporary oblivion! !!! Anyone who says otherwise is an idiot! Lol Just kidding. ;)
Plorex
09/07/2011 04:23 am
If I was google, I would just support something like a robots txt file where one can disallow bad inbound links... How about that
Phill
09/07/2011 05:14 am
Isn't that just open to more abuse? Site owners would then try and sculpt there inbound links like they did when page rank sculpting was cool? Googles Moto - Don't be evil. So should an Seo's... LOL
@JoeHobot
09/07/2011 01:10 pm
Anyone needs 20K links? hahahah Yeah I do hate when people use scrapebox blasts against some other website just to demote it...but then again...I have not seen much effect whether you buy links or somebody else bought it to hurt your ranking... I don't think it plays big role... not from comment backlinks at least... now ...Do-Follow links on posts, thats a bit different story.
Sara
09/07/2011 02:49 pm
It's interesting how split the poll is
Akash Kumar
09/09/2011 09:09 pm
I would be a little worried if the competitor is a very large company itself, otherwise I would work on my site and building links that these links become a handful of links so that search engines won't mind them.
jaw crusher
09/20/2011 09:20 am
I agree, but sometime, i send some information with my website on blog comment, if the blog comments are very lot, my website rank is downgrade,Why?
Abhi Sawant
12/15/2011 07:11 pm
Now what should I do to increase my ranking in google...??? If any one can help than....
Seo Company
05/14/2012 06:28 pm
I think the only people who really need to worry about are people competing for multi million dollar revenues. momma & poppa sites need not worry.