Page rank is one of the things where people who are new to seo seem to get confused, exited and worked up about.
I am going to attempt to dispell some myths about page rank and pass on some info.
Q1:if i have a higher pr than my competitor will i rank higher than him for my search term.
A1:Not necessarily. Page rank is calculated by the number of inbound links to your site and the PR of those pages.
as google sees things links are votes for your site, but these links are just general votes not always votes for your search term.
for this you need anchor text
What is anchor text. below is an example of anchor text London Website Design
the clickable part of a link is anchor text, this anchor text is voting for the term London Website Design.
your competitor may have 1200 inbound links and a pr6 but only a fraction of those links might have the correct anchor text
if you have 200 inbound links with the correct anchor text(targeted to your keyword) and off high enough pr sites you will beat him with a lower PR site.
Q2:So PR isnt that important.
Yes it is. the more PR your site has the more weight you can give anchor text through internal links to other pages.
its just not the the only factor.
Q3:what about on page optimisation, which is more important, on page or backlinks.
A3: in my opinion its about 50 / 50
Q4: whats a good PR
A4:A good achievable PR is about PR5, if you see a site with more PR than that its very popular.
Q5:how hard is it to go from a PR5 to a PR6 and can I get a PR10
A5: about 10 times harder from PR5-6, ten times harder from 6-7 etc, altavista & www.ebay
have a PR8, if you get a PR6 your better than most people.
any other questions feel free to ask.