Hi folks,

is it better to have seperate country specific domains (which costs more money) or subdomains which define the country, for better SEO?

eg.

• stackoverflow.com
• stackoverflow.com.au
• stackoverflow.co.uk

vs

• stackoverflow.com
• au.stackoverflow.com
• uk.stackoverflow.com

Assumption: int the search engine web master tools, each subdomain are associated to a country. eg. au.stackoverflow.com is associated to the country Australia.

cheers!

Update

I understand that both methods do work, especially when i utilize the assumption, listed above. The question is about: Which method is better? Is there such a small SEO difference between them? Is the first method way way way better than the second with getting better SEO results?

Update #2

A number of folks have suggested that the following is a good/better approach:

• stackoverflow.com/
• stackoverflow.com/au
• stackoverflow.com/uk

By adding a country specific iso code to the end of the url/the first folder of the domain can be recognised as the country.

But a number of SEO mates have suggested that this is a valuable waste of folder level space. Er.. how can i explain. Ok, it's been suggested by some SEO experts that if the number of levels or folders in the domain exceeds 5 then the page drops dramatically in importance. Basically, you don't want to make it deep. As such, adding the country as the first level can be considered a waste, especially when it can be handled by the domain OR subdomain - hence the question :)

So, any more thoughts on this? (Maybe SO is the wrong place to ask this question?)