In a recent Webmaster Help video, Google’s Matt Cutts reported that adjustments to Google’s search algorithms have removed many of the advantages given to sites

In a recent Webmaster Help video, Google’s Matt Cutts reported that adjustments to Google’s search algorithms have removed many of the advantages given to sites organizing content using subdomains rather than a subdirectory. More - http://www.brafton.com/news/subdomains-vs-subdirectories-for-seo-no-serp-benefits-for-subdomains-anymore http://www.brafton.com/news/subdomains-vs-subdirectories-for... Opinons on both sides for this question. SEOMOZ recommends folders - "Since search engines keep different metrics for domains than they do subdomains, it is recommended that webmasters place link worthy content like blogs in subfolders rather than subdomains. (i.e. www.example.com/blog/ rather than blog.example.com) The notable exception to this is language specific websites. (i.e. en.example.com for english)"