wolfadeus - 7:05 pm on Mar 23, 2010 (gmt 0)

I have a supplementary anecdote to tell: I have worked for an internet company in their SEO department; the company has specialised in a certain industry and had a regional focus. Even though they did not operate websites on their own (despite of me suggesting right that for reasons that have been brought up in this thread), many potential customers were hesitant to hire the company BECAUSE of its experience in their industry. Doing SEO for a website is a business in which a lot of sensitive information is revealed; you might not want to give access to your best traffic sources, keywords, link partners to somebody who also works for your competitor.

A particular problem of the company was the high fluctuation among its staff: 25 members, about one who cancelled per month on average, which I followed over the course of 2 years (freelancers not counted). That is a lot of inside knowledge evaporating away - and maybe condensing with somebody who will take advantage of it to your harm.