Danny Sullivan wrote a nice explanation on how Panda is more a ranking factor than a algorithm update. He gets into it in detail, but what Panda clearly is, is a penalty that downgrades the rankings of a site for having low quality content.
If it is an algorithm update or ranking factor - to me, isn't that important. The result, Google flags your site as having low quality content, you then get pandalized and your whole site can suffer.
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