In theory, taxonomies beat categories hands down for organizing content.
The main advantages are flexibility and precision.
With taxonomic tagging, you describe content on an atomic level, very precisely, and then you build queries get lists of the stories (or photos or whatever) that you want.
And because a true taxonomy maintains a parent-child relationship between entities on the taxonomy tree, you can go up or down the taxonomy tree to build general or specific queries.
So how does this build flexibility?
First of all, categories change. All of a sudden you may wake up and realize you really need to have a section devoted to the business of sports. If you’ve been taxonomizing well, that’s no problem — you’ve probably got a bunch of stuff that already has both business and sports tags. Now you just pull them together in a query, attach the query to a page or a block, and away you go.
But if you’ve been a category-based site, and you never had that particular “sports business” category before, then nobody has ever categorized anything helpful. So you’ve got to search through the database and manually recategorize the stuff you want.
Taxonomies also give you much greater precision, because you’re not just categorizing something as “sports,” you’re tagging it “sports>basketball” and you’re also tagging it for professional, college or high school, and you might even be tagging it as a tournament game. Want that Final Four page? No problem.
Even if you don’t go around adding new sections or content lists all that often, the inherent precision of taxonomies can help you get much tighter lists of related articles.
That’s the theory, anyway. In reality, there are lots of challenges to making taxonomies work for your site, from uncooperative content management systems to basic human limitations.
More on those challenges later, but for now check out the IPTC’s NewsCode taxomony, which is a pretty good starting point if you’re going to use or develop a taxonomy for your site. Also, this (somewhat outdated) history of the IPTC’s work in this area from controlledvocabulary.com is helpful. It’s focused on image tagging, but it gives a good overview of the evolution of the IPTC standards work. And the Dublin Core metadata initiative has some pretty clear explanations of what all this is about.