This bird had a couple of issues going on that were affecting the quality of his feathers.  First, he had feather mites that were causing him to
over preen hence damaging his feathers.  He had a rather intense case of scaly face AND leg mites, and also had an iodine deficiency
affecting his ability to produce and maintain head feathers.  He was also what I refer to as "shaggy" with loose, soft feathers instead of the
tight, harder feathers I look for in my birds.  This shagginess indicates less than optimal nutrition in the aviary from which he was purchased.  
However, once he goes through a full molt, all of this damage will be repaired and he will be one fine looking bird!

To remedy the mite situation, he was quarantined.  Scatt was applied on day 1, 10 and 21 and Iverlux (Ivermectin) given in both drinking water
and baths. He was given bath water daily when not being treated with the Iverlux.  The bath contained citric acid to wash away any dead mites
and leave his feathers glowing.  To remedy the "shaggy" condition, he was given a high protein diet supplemented with spirulina, wheat grass
and shaved cuttlebone.  Biotin was added to his supplement routine and his iodine was adjusted temporarily to allow for a smoother molt.

He no longer has signs in his feathers of the mites and pin feathers continue to emerge as his nutrition has balanced out.  When he completes
his molt, I will add photos of his improved feather quality!
Balding may occur for a variety of reasons.  In a large aviary with many birds, there is literally a "pecking order".  Birds will stake their territory
and let the other birds know who is in charge.  Often times one bird will become the victim of violent attacks from the other birds.  These
dominant birds will peck at the head and face of the lesser bird, therefore plucking the feathers away from those areas.  However, if your bird
is alone in a cage, or if you are certain no other bird is attacking it, chances are your bird has a nutritional deficiency.  In Goulds, this
deficiency is usually iodine or scaly face mite related. Creating a balanced diet and adding liquid iodine and calcium to their drinking water and
treating for scaly face mites will usually solve the balding issue.  You should see new pin feathers emerge in the bald areas within a few weeks
of the added supplements.
Losing large numbers of feathers at one time or not replacing all of the feathers is considered an abnormal molt

Molting is a natural part of being a bird, but when a bird doesn't molt annually, or molts out of season, this is called an "abnormal molt" and
may be a symptom of a larger problem. The bird keeper must then evaluate the situation:

Food:  Is the bird receiving the proper nutrients?
Stress:  Has the bird been under any undue stress that might cause it to lose feathers?
Surroundings:  Is there an unseen parasite in the aviary?

Feathers that have been damaged by many factors including parasite infestations, over-preening, disease, nesting, etc. need to be replaced.  
They may replace all of their feathers during the annual molt, or if nutrition is lacking, only a small portion.
DAMAGED FEATHERS
ABNORMAL MOLT
BALDING
FEATHER PLUCKING
Feather issues can be nutritional, health related or, in my experience, hereditary.  
Read below for more information! (See External Parasites for more photos and information)
Feather Damage from Mite Infestation
Missing Head Feathers - BH GBB Cock
Frayed Tail Wires from Mite Infestation
NORMAL MOLT
Birds go through an annual molt and will sometimes lose individual feathers through the rest of the year.  A typical molt is obvious, but nothing
to worry about.  A normal molt is usually ugly and can be a bit frightening to the new bird keeper, but rest assured, it is a normal process and
as long as your bird is receiving proper nutrients, exercise and lighting, they will be just fine in about 4-6 weeks!

Below are photos of a normal molt.  Notice the breast feathers have lost some color.  These will be replaced with bright glossy feathers as the
bird produces new ones.  Replacing head feathers is usually the last and most obvious part of the molt and can make a bird look pretty pitiful!  
This bird is not happy that I have chosen him for photographs!  As you can see, he also has scaly face mites (as indicated by the upper beak
hanging over the sides of the lower beak) and needs his beak and nails trimmed.  All of this will be done while I have him in hand!
Normal Molt - Dilute RH Cock
Normal Molt - Dilute RH Cock
Feather plucking in finches is usually attributed to a nutritional deficiency or mite infestation.  Birds who pluck their own feathers may also be
stressed or have some other illness that is irritating them.  If after re-evaluating their diet, removing any stress, and eliminating the possibility
of mites or other illness they are still plucking their feathers, it could be that they are "just pluckers".  Birds whose nutrition is excellent, are not
stressed, and do not have mites but who still pluck feathers should be housed away from your other birds.  

In my experience, feather plucking can be a learned behavior.  I once owned a Zebra hen who would pluck her own feathers and those of her
mate.  When she produced her first clutch, she proceeded to pluck every feather off of those six chicks, two of which proceeded to pluck their
own feathers and those of their nest mates, daily.  After evaluating their diet and having them tested for mites or other potential illness, it was
decided that they were "just pluckers".  These birds were never bred and consequently lived out their lives partly bald.
Missing and damaged head feathers in
this bird are partly nutritional, partly scaly
face mite damage.
Wing feathers and some back feathers are
damaged from over-preening due to feather
mites.
Tail damage from over preening
and feather mite infestation.

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Feather Problems
UPDATE:  Yes indeedy, this IS the same bird!  Nothing like tweaking the nutrition and treating
the mites to achieve gorgeous results!  Notice how tight and sleek his feathers are compared
to the previous photos.  If you look closely, you can see the last of scaly leg mites on his feet
and toes.  This will be remedied as the scales come off.  I apply Vaseline to the scales over the
course of several weeks.  The scales will eventually lift right off!
Dilute cock after molt
Dilute cock after molt
During Molt
After Molt
Heavy Molt
A normal relatively "heavy" molt
photo compliments of Joy O.
Notice the "loose" looking feathers,
lightening of the chest, and "porcupine"
pin feathers on the head and neck.  
Goulds look pretty pitiful during a full hard
molt, but it is nothing to be worried about!
Typical Molt
Typical Molt
Typical Molt
Typical Molt
Typical Molt
Below are more photos of what a typical molt may look like!  Click the photos to enlarge!
Feather Mite Damage in Gouldian Cock