Sonya,
This depends on what you want to find out :-). The best form of background checking is still through specialised providers. However depending on the industry you are working in as using the web to supplement background check ingis a good idea, technology for example.
A word of caution, you need to understand the site that you are checking, for example a MySpace page is personal, yes public, but personal all the same. Just because the job applicant got drunk at Schoolies 4 years ago when they were 18 does not mean they will be a poor employee at 22. In fact just cause they got drunk on the Friday before the interview doesn't either.
If reviewing someones blog you need to assess is it personal or professional. Personal ignore it, as with MySpace, FaceBook etc. Professional have a look you will get a very candid and open perspective of the candidate and not everything will be to your liking, but it never is. With a professional blog, double check the quality of the technical content, who is commenting, review Technorati are they influential?
Their LinkedIn page is a good source of validating what they have done and who they know, it should match their paper CV, to a point.
You will also find if they have been quoted in mainstream media, presented at conferences or written professional articles.
Another thought, you can't discriminate due to gender, race etc are we going to see discrimination cases over people not being hired for their MySpace page? Actually I seem to remember that this has already happened, before go do some research. ;-)
Hope this helps and I am not preaching to the choir!
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