The prevailing thought is that Google and Bing will penalize you if they determine your content has been duplicated. The "penalty" has been described as anything from a minor rankings impact to a significant hit to your domain authority. The reality is that this is only true in the most extreme cases where search engines can clearly determine that your intent is deception and manipulation. This situation requires greater context than just copies of the same content. For more detail, read Google's thoughts on duplicate content here.
The real problem with duplicate content is not that the search engines will enforce a penalty. It is that they will only consider one version of it for ranking signals and for displaying in search results. This is reaction is because they focus on providing a good user experience and do not want multiple results that bring users to the same content when one will suffice.
What this means for you is that the page you want search engines to use for ranking and display in the results may not be the one they select. This selection may have less of an impact if they choose another version of content that is on your site, rather than if they were to choose a version on another domain. If they choose another domain, then that site will receive all of the search traffic that your content has ranked. The impact of this will vary based on the actual content and your strategy for that piece, but it can be and usually is pretty significant. The good news is that you do have some control to help the search engines “get it right.”
Both of the major search engines provide tools to manage various search related tasks. These tools are powerful and help with more than just duplicate content issues. Let's come back to the previous problem with URL parameters. The problem was that adding "?source=email" to the URL caused the search engines to see two different URLs for the same content thus identifying it as duplicate content. With these webmaster tools, you can address this problem by setting parameters that you want the search engine to ignore like "source" from our example. When you do this, the search engines will then see URLs like www.bitwizards.com/duplicate-content and www.bitwizards.com/duplicate-content?source=email as the same and understand that they are in fact the same content.
Director of Solution Delivery
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