ismailman - 8:09 pm on Feb 25, 2011 (gmt 0)
Here's my analysis.
1. This is a sitewide penalty. If you Google deems your site as "bad" it applies a discount to each of your page's "score"
2. It's not a direct -X in the SERPs. Instead it affects the page's score, so the end result of the SERP depends on how competitive the listings are and how clustered the scores are
3. Certain sites/segments that "should" have been hit weren't. And sites/segments that "shouldn't" have been hit, were. The classic example is eHow, everybody wanted them hit, and they're still doing fine. You also have the spam sites that appear to be doing well. Reasons for the spam sites to be doing well is that they're probably too small to trigger the "content farm" flag and score discount
4. It doesn't seem like any sites are getting "boosted" but are simply being rewarded by not being discounted, and therefore relatively they have a better score.
5. The score discount seems to be tiered. That is some are affected slightly, while others are affected a lot.
6. A drop of 40-60% in Google US traffic seems to be the common number. So whatever the score discount they apply is chosen to result in that level of traffic loss. It seems too specific to not be a deliberate choice.
So overall what happens for a particular search before and after is that a certain group of sites are flagged and then drop down the rankings. All the relative ordering between the non-flagged sites stay the same, and the relative ordering with the flagged sites stays the same for the most part. It's simply the shift that the flagged sites have relative to the non-flagged sites that sees the flagged sites lose traffic, and the non-flagged gain traffic.
Now the problems arise in that the sites that are being flagged seem really out of whack. A lot of sites are being flagged that you could easily argue shouldn't be, and there are sites that aren't being flagged that you could argue should be. This is causing for some pretty nasty looking search results in certain vertical (shopping/products definitely comes to mind).
How this plays out over the next little while will obviously determine the fate of A LOT of people's livelihoods, so let's all hope that Google does what's Right.