both subdomains and subfolders can be created to specify keywords in your url, and thus improving the page's relevancy to a certain search.
ex. webhosting.domain.com or domain.com/webhosting
my preference is using subfolders because I can create this folders manually or programmatically without affecting the server where subdomains requires me to restart the webserver (apache tomcat) or website to make the subdomains take effect.
subfolders also tend to be more memorable than subdomains and most big companies advertise url's more with subfolders than with subdomains like dell.com/tv
recently, i was just pondering if subdomains have any special value in search engine ranking. yahoo for example use subdomains for : webhosting.yahoo.com and for domains.yahoo.com
any seo experts out there willing to share some wisdom?

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