Forum OpenACS Q&A: Re: Approach to Google-optimizing
As discussed in When Experts Agree: Using Non-Affiliated Experts to Rank Popular Topics, a paper written by two Google researchers, authority sites often link to other authority sites. This paper describes an algorithm for ranking "expert" sites.
A paper entitled Authoritative Sources in a Hyperlinked Environment, written by Jon Kleinberg at Cornell, distinguishes between hubs and authority sites. Hubs have many outgoing links, ideally to related authority pages, and authority pages have many incoming links, ideally from related authority pages.
Improved Algorithms for Topic Distillation in a Hyperlinked Environment describes a query-based approach that ranks the interconnectivity of pages linked to and from the other top 1000 results for given query.
It is thought that Google has recently modified its algorithm to incorporate some or all of these techniques. In January I optimized a bank's site based on the algorithms discussed in these papers. The site launched in October, and I noticed substantial improvement in rankings after the Google February update.
It does not appear that modifying a page's outgoing links will have any immediate effect. It appears that site connectivity rankings are calculated once a month at the same time PageRank is calculated. In addition, the effects from tweaking the content of a page aren't as noticeable on a day to day basis. Until November, you could change the number of times you repeated a phrase in a page, and the next day you could notice a significant adjustment in the SERPs.
Also, in April 2003, Google acquired Applied Semantics. Recently it appears that it is more effective to use related keywords on a page/site than it is to optimize a page for a particular phrase. Patterns in Unstructured Data discusses the concept of latent semantic indexing. Use Google's Keyword Suggestion Tool to find a list of keywords Google identifies as related to your target phrase.
You can find links to all of the above papers, and ~40 others on my website: Search Engine Research Papers.