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Domain Authority
I'm about to go to bed so I won't be writing much here. I just want to touch on this issue and get the thread started and see what kind of contributions members will make.
I see domain authority as a bigger part of Google's algorithm than at any time in the past. I think it's a logical step in the right direction. Before domain authority, Google was at the mercy of anchor text. With anchor text, you're relying on people to use descriptive anchor text in their links, and forced to pretty much disregard all links that do not use descriptive anchor text.
With a domain-authority based algorithm, they are able to improve the algorithm by allowing it to be determined by a much, much larger pool of links (descriptive link and non-descriptive links).
I also believe that domain authority is established topically using anchor text domain-wide. That is to say, if I link to v7n.com/widgets.html it will increase my ranking for other widget related pages on v7n. Domain theming via anchor text, instead of web page focused ranking.
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