Open Questions - Subdomains and Main Domains

I got a great question on my SEO Empire post from Ryan at NetSEO. I figured it was worth addressing in a post rather than leaving a really long comment.

Eli,
Can you be so kind and explain why this is:
“Primary domains can pass a penalty to subdomains. Subdomains can’t pass a penalty to a main domain unless the main domain holds a relation to the subdomain (ie. a link).”

Happy to answer Ryan
Anytime I make a statement like that I am usually making a reference to an exemption to the general This-Is-My-Site -> This-Is-Google -> This-Is-The-Value stream of things. Sometimes I’m a bit presumptuous in assuming readers caught the reference. In this instance I’m talking about the exception given to protect free hosts from penalties, particularly those who give their users subdomains such as Hypermart, Xoom, Wordpress.com, Blogger, Tripod etc. This exemption can’t only cover the popular free hosts otherwise no new freehosts would ever stand a chance. As soon as they got a single spammy user their whole site could get banned and poof goes their legit business. Likewise algorithmically it can’t cover all free hosts because then the biggens like Wordpress.com and Typepad would all be penalized. On a foresight this would also include profile based social sites such as Myspace and outbound linking social sites such as Delicious. Anyone remember when Geocities sites used to rank so well. Yet at the same time with a lot of splog platforms out there manual reviews would be a nightmare and unfeasible. So there is a line drawn. That line has to consist of some sort of relationship between the primary domain and the subdomain of a site that’ll evaluate if the “subsite” belongs to the main site or if it’s a separate entity. By way of algorithms that relationship is very tough to determine. In fact it’s damn near impossible to do with 100% accuracy. Unfortunately for them, they have the burden of relying on internal linking relationships between the two which would include the above statement as well as other protective factors that would encompass other exceptions such as nonstatic links (like Furl & Delicious would use).
This area of unsureness gives us SEO peeps room to do things such as create splogs and do subdomain spam. As long as we know what they’re looking for (the antispam teams) we know what not to provide. Most sites that contain ownership of their subdomains link from their mainpage down to the subpages to the subdomains and so on and so forth. So when in doubt do the opposite. It’ll provide less of a chance for a relationship between the maindomain and subdomain to be found and if you’re worried about linkjuice get it from other sources via deeplinks.