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Link popularity is much more than a number of links that point to a site. Search engines have been able to come up with sophisticated formulas that go beyond numbers. Link popularity and the quality of links, are currently determined by the following three factors
Number of Links - The more, the better. Although having several irrelevant links is not as effective as relevant ones, it's better than nothing. Inktomi, a provider of search results to engines like Hotbot, still values the number of links more than anything else. Relevance - Search engines want links from pages that are relevant to your site. This can include your competition, supplier, or anyone else in the same category.
Google measures relevance through its Page Rank formula, along with other engines such as Hotbot and Altavista. This lets people, rather than meta tags, determine how high a page ranks. If a similar site links to you, they probably found your content to be interesting.
Link text - This refers to text used in a link, the text that people will click. For example:
SearchEngines.com or Search engine guide or Click here all link to the same place, but use different text. Obviously, the use of keywords in the description of a link is beneficial.