Here’s what the official Google blog says about it:
In developing Sidewiki, we wanted to make sure that you’ll see the most relevant entries first. We worked hard from the beginning to figure out which ones should appear on top and how to best order them. So instead of displaying the most recent entries first, we rank Sidewiki entries using an algorithm that promotes the most useful, high-quality entries. It takes into account feedback from you and other users, previous entries made by the same author and many other signals we developed. If you’re curious, you can read more on our Google Research Blog about the infrastructure we use for ranking all entries in real-time.
Under the hood, we have even more technology that will take your entry about the current page and show it next to webpages that contain the same snippet of text. For example, an entry on a speech by President Obama will appear on all webpages that include the same quote. We also bring in relevant posts from blogs and other sources that talk about the current page so that you can discover their insights more easily, right next to the page they refer to.
I think this is really the beginning of something very powerful for the social web.