I blog in a certain niche but quite often include useful links at the end of each post which are not strictly or directly related to my target subject matter. The link juice can be wasted by flowing to these external links, rather like having a leaking pipe when you want to turn on a tap. I went through my blog last night "fixing" external links by making them no-follow and also having them "blank" (new window) to ensure including these links is not counter productive. This article describes it quite well: http://www.mybloggertricks.com/2011/08/when-should-you-tag-external-links-as.html I would be interested to gather more thoughts on this. Do you set your links as No-Follow? What if it is a guest blogger? Do you set them as No-Follow then? I have had paid links on my blog and those are the ones I have left as Do-Follow. I want them to see the benefit of their backlink placement and possibly pay again in the future.
Actually, you are *not* retaining any more PageRank for the "dofollow" links unless you completely remove the nofollow links from the page. http://www.mattcutts.com/blog/pagerank-sculpting/
You do know that this is 2012? Even the article your referencing that was published in 2011 was out of date by more than year when it was first published, never mind now. /facepalm
Welcome to the world of SEO It's actually 2 years out of date. It once was a very effective method (and i mean VERY EFFECTIVE) but now it just another way to tank your sites out of the SERPS. It takes people a while to catch up because they fail to do their own testing and deep throat every forum post they read that is more often than not just opinion not based off their own testing/analysis. It's a viscous cycle ^^