First, let's look at what website wide links are. After all, if a 2,000 page website has links on half of the pages and a 10 page site has links on every page are both of these truly "web site wide"? Well, there are a few ways of getting web site wide links:
1 - asking a favour of another website owner
2 - providing a template, or being the web site designer for the web site
3 - having a connected, possibly a sister, company
If any of these apply, then it is maybe true that the search engines would want to ignore the links. But why do people think that website wide links are a problem?
Well, heaps of people will link between their own sites using website wide links. Some of these have noticed that when the website wide link is cached by the search engines the results for the recipient website suddenly get a load worse. So the theory starts that these links cause damage to the website.
But, is there another answer? Typically these people are defensive of their websites and do not publicise their website adresses. So it is not likely to fully check their theories. Such as, I read yesterday of a web site owner with 5 web sites. One web site linked to the other 3 and it was the standalone web site that did well in the search engines. When he added that to the links on the first web site, this website also dropped in the results.
However, would a respectable search engine really drop a web site through the rankings only because of website wide links? I think not, else anyone could destroy any other web site's rankings by listing it across their full site. And off site effects are not supposed to negatively impact search engines.
So, what might be going on to these example people? I think it is quite easy. What if the person above, who's main web site he said had a good page rank, had the other website linked to from 1 good page and it was that link that gave the good search engine position? Then, when the web site wide links were put in place, rather than merely destroying the web site's optimisation the search engines decided to ignore all of the links from that website?
It is beyond doubt a possibility and a worring one as a site designer. Why? Well, like a good artist, I like to sign every website that I create and this gives a link back, as a rule from every page of the website. If site wide links are not valued, then I am missing a trick here.
This could mean that side wide links are a problem and something that we need to sort out. Perhaps they are ignored, or possibly people are right and they act negatively, but I very much doubt this. It is difficult to say for sure and something that needs investigating. But, there are very good reasons for them not to give any benefits at the very best.
So this is an investigation that I intend to follow up with a series of experiments. I will be purposely trying to get web-sites optimised for 'random' phrases and then seeing if they can be destroyed with website wide links.