Google quietly updated the URL parameters feature within Google Webmaster Tools to give webmasters more advanced controls.
Google first introduced URL parameter controls in 2009, then upgraded it in late 2010. Now, Google is letting you define if a parameter change results in the content on the page changing or not.
Vanessa Fox at Search Engine Land goes into technical detail on how this all works. But in short, you can now communicate to Google if various URL parameters change how content is displayed on a web page, which can be useful for pagination, sorting, filtering and so on.
As Vanessa puts it, "as the parameters multiply, the number of near duplicate pages grows exponentially and links may be coming in to all of the various versions. This dilutes PageRank potential, and the “canonical” version of a page may not ending ranking as well as it otherwise would. Search engines may also spend much of their crawl time of various versions of a small subset of pages, preventing them from fully crawling (and thus indexing) the site."
I am not going to get into the step by step process on how this works, Vanessa did that, so check it out.
Forum discussion at Sphinn.
