I can definitely understand the frustration, but Google won't penalize sites for simply having duplicate content, and especially storefronts. Many merchants are provided with photos and product descriptions by the distributor, and when you're talking about hundreds or even thousands of products, it just not feasible for a merchant to change all of the descriptions and even more so if your inventory is changing on a monthly or even weekly basis. Then all of your changes get overwritten with the new upload.

A good example would be the SMC websites that you see on late night TV where they send out a CD with products to thousands of customers and 98% of them just upload the database into their stores with little to no alteration.  They won't be penalized, but they just won't be able to sell much.

In those cases, the sites aren't going to be penalized. And if those sites are ranking well without changing the content, then Google is definitely looking at other factors to make that decision (traffic, bounce rate, time on site, etc.).

The sites Google are penalizing are the ones that intentionally try to game the system by stripping content from other sites and reposting them with literally no changes at all. Also sites that try to duplicate one of their stores multiple times in a cookie cutter fashion in order to trick the system to see if they can get multiple listings on the SERPs.

You haven't provided specific sites to review for a definitive answer here, but they don't sound like they're trying to do anything black hat. They're just lazy. But if your site will be selling the same products, altering your descriptions and images is the only way that you'll get the advanatage over them instead of just becoming "yet another one of those sites". Good luck!

I have a client who is hotlinking their images from one of their domains. I'm assuming the images were originally stored on the first domain (let's call it SiteA.com) and when they were putting together SiteB.com, they decided to just link to the images directly on SiteA.com instead of moving the images to Site B. Essentially hotlinking.

Site A is not using the images in any way and in essence is just a gateway for their other sites and in this case a storage for their images.  It doesn't use those images at all, so it really doesn't get any benefits of the images being referenced since I read that Google sometimes counts that hotlinking as a "vote" for the original image. But again, since ite A doesn't use the images that are being hotlinked at all, there's no benefit for Site A.

My concern is that it's affecting their SEO for Site B because it makes it look like Site B is simply scraping data by hotlinking those images from Site A.

Their programmer suggested creating a virtual directory so that it "looked" like it was coming from Site B. My guess is that Google can see this, so then not only will it look like Site B is scaping/hotlinking images, but also trying to hide it which may send up red flags to Google.

My suggesstion to them was to just upload the images correctly into their own images directory on Site B. They own the images, so there's not any copyright issue, but that if they want proper SEO credit for that content, it all needs to be housed on the correct server and not hotlinked.

Am I correct in this or will the virtual directory serve just as well?

Actually, that IS the one answer I do know and that it DOES have a benefit to you if your image is being hotlinked to because Google sees it as a "vote" or the equivalent of an inbound link. I saw that on the Google Webmaster Forums.

I'm just at a quandary about the linker.