Can third party content on sub-domains harm the main site's search rankings?

Posted by dror on Pro Webmasters See other posts from Pro Webmasters or by dror
Published on 2013-10-17T12:52:35Z Indexed on 2013/11/12 4:18 UTC
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seo

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subdomain

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blackhat

I have a site that is a "portal" or "directory" for service providers. We opened every service provider's own page on our site, but now we get a lot of applications from those providers that want sites from their own. We want to make a full site for every service provider, but rather put them on sub domain URLs. (They don’t mind, it's OK for them.)

So, my site is www.exaple.com Their site will be: provider.example.com

Now I have two questions:

Can the content on the provider sites harm my site in SEO?
If one from those sub domains is punished by Google because the owner does "black hat SEO", how it will affect the rood domain? Can it make the root domain get punished?

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