tedster - 1:33 am on Apr 22, 2011 (gmt 0)
Someone put forth the idea on the forum that somehow Google builds a score of what it considers "low quality" pages and dings the site as a whole if it reaches a threshold.
That idea was being floated pretty strongly by Google engineers interviewed at the TED conference. So it's not just any "someone".
The pages Panda thinks are really crappy in themselves get the deepest demotions. The rest of the site gets a less severe demotion because it's somehow contaminated and doesn't deserve as much search traffic. From what I've seen it looks like a weighted demotion, depending on how many clicks separate the other pages from the Panda-targeted pages. I'm not 100% on that pattern, but my preliminary look seems to suggest it.
The idea is, I think, that Google wants to send visitors to SITES that give them a good experience, not just to "a page" that is relevant for their query phrase.