When Google released their new design this week, one thing we noticed is the Google now highlights keyword phrases even when they are not separated with a hyphen or space. For example, I did a search on mens shirts in Google and look at how Google was able to decipher "mensshirts.htm" as "mens" plus "shirts".
First time I mentioned this at the roundtable was during my coverage of the Search Engines & Web Server Issues during the SES NYC conference. When one of the speakers was complaining that he couldn't get the new design (this was before the new design was out) off his screen and he noticed that Google was able to pick up keywords in a single string.
Jill Whalen in here High Rankings Advisor: Contextual Search - Issue No. 092 email, she does this Q&A thing. One of the questions asked, and I quote:
I just noticed that Google search results now highlight the searched criteria in the file/document name. Does this mean they are giving more weight to this than in the past? I always use relevant file names as a part of my optimization process, but understood it only carried weight at a few places.
Jill's response was:
Nobody really knows what it means except for Google. However, it's my opinion that it doesn't mean anything other than the fact that their new highlighter sees all the search words on the page, even words that are not parsed by a hyphen, etc.
It's doubtful that this has anything to do with Google's algorithm. They recently changed their look, and this is just a manifestation of that.
I am doubtful that Google would put any additional weight on file names or domain names in their ranking algorithm. If anything, I would imagine they'd be moving further and further away from giving those fields any weight.
This is a perfectly honest answer. In fact, one person at the SES said it is way to easy for Google to raise a red flag on a site if the URLs were stuffed with keywords and hyphens. However, I personally use the mod_rewrite to change the extensions of the URLs to keyword rich text. When it comes to the domain name, I would not go beyond two hyphens.
I could not find much forum coverage on this topic, so I used a newsletter. :)