Your friend is making too general of a statement. What specifically is it about a blog's on-site/off-site structure that is suddenly now discounted in the Google algo?
In my experience, the link structure of a lot of blogs (specifically, a jillion sidebar links replicated on every page of the site) started meeting with serious Google disapproval one or two years ago. I lost some serious traffic when it happened.
The fix, which many SEO/bloogers were already doing and so they never saw the problem, is to control total outbound links and especially avoid replicating the link-heavy sidebar on interior pages. Even then, it takes months and months (six months to a year) for Google to stop crapping down your chimney once you've felt the need to make that sort of changes.
Just my two cents, you'll get many differing opinions because everybody's experience is a little different.
Google whom wasn't showing a certain blog any love before, I thought hated such blog, but blog grew on Google.. now google loves blog so much he can't stay away from his number one he love her so much..
Google doesn't hate blogs..
It does hate the over use of RSS feeds with 0% real content.. And crappy sites..
Honestly if you know what RSS feeds are... then you can understand why google is not going to push your site up if that's all it has.. As for shit sites... well if your site looks like your dog designed it well chewing on your laptop then don't expect to be running up to that #1 spot...
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