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My question is, do search engines consider these 2 different pages? Furthermore lets says I'm getting incoming links to the www.xyz.com from 10 different sites and and incoming links to www.xyz.com/index.html from 10 other sites. Do they divide up the value of the links?
(There are some programming in the site and he said it was a lot easier to have it as /index.html)
If he said it was easier that way, let him have his way. Then, when you decide to change the underlying technology of your site from .html to .asp or .php, he can be the one that backtracks everyone who linked to the site that way and have them update their URI references. :)
If linking to the root of your web, this would be best practice...
[example.com...]
Include the trailing forward slash. When linking to root level pages at the sub-directory level, this would be best practice...
[example.com...]
Include the trailing forward slash. Keep it simple.