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Article Marketing and Google’s War on Content Farms

Google announced they are testing algorithmic changes to limit the ranking ability of sites that produce low quality content. The change is primarily targeted to “content farms” but their change could end up affecting article providers depending on how and what they implement.
For those of you not familiar with the term, a content farm is a site that generates content requests based on search demand and what the publisher expects to make in advertising revenue for that keyword. Typically a farm site will post a story request like this:
“400 Word article on the advantages of getting an insurance quote online – Pay: $12”
Someone then claims the assignment and proceeds to write and submit the article. During the writing process the content can become quite diluted especially in competitive keyword areas like home loans and mesothelioma where 95 percent of content is rewritten from existing sources. Once it’s published, the content can outrank more authoritative sources (papers, studies, major news sources) based on the strength of the domain and in turn the farm makes a profit as a result of search visitors. While I don’t have any data in front of me, one could even argue that hosting low quality content is to a publisher’s advantage because visitors could be more likely to click ads out of pure frustration with the result of their search.
In some cases, a content farm might even lift text directly from an authoritative source and simply add some small changes to make it unique. While a site owner can file a DMCA, they rarely notice this is happening until they review their analytics and notice major changes in search volume. While Google can detect duplicate content, in my experience, it does not resolve it very well.
Content farms exist in a number of different forms and one of the largest content publishers, Demand Media, had an IPO today that has seen 30 percent gains in early trading. However their gains could be short-lived because Google announced a new campaign against low quality content on the eve of their IPO. The company pushed back at critics with the following post about search quality and in it Matt Cutts had this to say about content farming:

As “pure webspam” has decreased over time, attention has shifted instead to “content farms,” which are sites with shallow or low-quality content. In 2010, we launched two major algorithmic changes focused on low-quality sites. Nonetheless, we hear the feedback from the web loud and clear: people are asking for even stronger action on content farms and sites that consist primarily of spammy or low-quality content.

As far as what these actions entail, Cutts elaborated with the following:

… We recently launched a redesigned document-level classifier that makes it harder for spammy on-page content to rank highly. The new classifier is better at detecting spam on individual web pages, e.g., repeated spammy words—the sort of phrases you tend to see in junky, automated, self-promoting blog comments. We’ve also radically improved our ability to detect hacked sites, which were a major source of spam in 2010. And we’re evaluating multiple changes that should help drive spam levels even lower, including one change that primarily affects sites that copy others’ content and sites with low levels of original content.

I welcome these changes but at the same time I’m worried that this could end up affecting traditional article marketing sites like Ezinearticles that operate on a different business model but have their own issues with derivative quality content. If Google is only performing their quality and duplicate content analysis on a document then I’m fine with that. Writers on free sites like Ezinearticles and writers on “farms” can produce some great work and subsequently low quality work and it benefits users if Google is able to separate the wheat from the chaff on that level.
But if Google is issuing domain level adjustments which could be a possibility according to the last line of Matt’s quote, that’s where they will run into problems. Does Google choose to devalue content only on sites where writers are paid to play? What about hybrid sites like Squidoo? Or free sites like Ezinearticles? How do you choose one site over a number of similar competitors? Will Google’s goal of encouraging unique content result in a chilling effect for content producers?
What are your thoughts?