Before we get into the www or no www choice for your website domain url’s, it makes sense to have some clarity on Canonical URL’s. In simple terms, canonical means “standard” or “authoritative”, so the canonical URL is the one you would want the search engines and users to see. Technically www.website.com and website.com would mean different things to the search engines. This might create the possibility of self created duplicate content in the SE index as also the added factor of split in link popularity.
The best way forward is to make a permanently re-direct(301) of all forms of your domain URL to the standard and canonical one. Define redirect rules on your .htaccess on Apache if you are on a Linux Box or on ISAPI on IIS if on Windows Hosting. This gives clear direction to Google as to what is your preffered canonical URL.
An interesting development has been the recent announcement by Google, Live and Yahoo about support for a “Canonical URL” tag to help site owners eliminate duplicate content. It would be like rel=”canonical” href=”http://cloudtrance.com” . Currently this tag adoption is more on the nascent stage and will suffer in comparision to the 301 in terms of cross domain functionality. So ideally a 301 redirect would be the best bet to define your canonical URL and ensure your hard earned SERP’s dont hit a downslide.
Having www or no www does not matter much. What really counts is what you decide as your canonical URL and use re-direction the right way for the non-canonical.