Great article in the NYT over the weekend about an ad arbitrage directory named Sourcetool, which Google punted from the AdWords program. A couple quotes:

When I pressed Mr. Fox about Sourcetool, he refused to tell me why the algorithm had problems with the site. When I asked him why the business.com site was in the algorithm’s good graces but Sourcetool’s wasn’t, he wouldn’t tell me that, either. All I got were platitudes about the user experience. It wasn’t long before I was almost as exasperated as Mr. Savage. How can you adapt your business model to Google’s specs if Google won’t tell you what the specs are?

Business.com...

• sells links (yes they have editors, but when they were interviewed about a year ago by Aviva Directory they only had 6 editors managing 65,000+ categories...many of the listings not only included aggressive anchor text, but also allowed the use of up to 5 spammy sub-links with each listing)
• used nofollow on many of the free editorial links (while passing link juice out on the paid links)...this was corrected after we gave them a proper roasting on Threadwatch :)
• uses a funky ajax set up to hide work.com content in a pop up (but makes it accessible to the Google crawler)
• scrapes Google search results as "web listings" and in some cases Google ranks these pages! (Google is ranking a Google search result surrounded with Google AdSense ads, branded as Business.com)

Any one of those 4 would be enough to kill most websites, but because of Business.com's large scale, strong domain name, and brand they can do things that most webmasters can not. They are given the benefit of the doubt because Google can not clean up all arbitrage without hurting their own revenues - and Google's job it easier if they have to police a few thousand companies rather than millions of individuals.

Google also told me that it never made judgments of what was “good” and “bad” because it was all in the hands of the algorithm. But that turns out not to be completely true. Mr. Savage shared with me an e-mail message from a Google account executive to someone at another company who had run into the same kind of landing page problem as Sourcetool. The Google account executive wrote back to say that she had looked at the site and found that “there seems to be a wealth of valuable information on the site.” Consequently, her team overruled the algorithm.

Want to learn what the algorithm thinks? Read Google's remote quality rater documents. They tell you what Google wants and how the algorithm really works.

Algorithms (and under-waged third world employees labeled as the algorithm) often make mistakes. If a mistake is made when Google passes judgement against your site, is your site good enough to recover? If your site was deleted from the Google index would anyone other than you notice and care?