Digg Sold for $16 Million

It was once the pinnacle of social news. Now, the site has been thrown onto the digital scrapheap with various parts being sold to different entities. While Digg still generates some traffic, many users have been hypothesizing what went so horribly wrong with the site.

Note: This is an article I wrote that was published elsewhere first. It has been republished here for archival purposes

It was around 2005 when I saw Digg becoming a huge deal. Sites everywhere began sporting the Digg button at the bottom of each news story. The reason, of course, was simple. If a story was posted to the front page of Digg, that pretty much guaranteed a sizable spike in traffic for just about any site including a large and well-read site like ZeroPaid.

The site also began a vidcast called Diggnation where Kevin Rose (with a Mac laptop) and Alex Albrecht (with a laptop with a Windows Operating System) drank beer and read the news stories that became popular on the site. Top stories easily achieved several thousands “Diggs” and the comment section of each story had numerous comments which could also easily be voted up or down. The site, at one time, made pretty much every other social news websites look like cheap imitations by comparison.

For a time, it seemed like Digg would be one of the sites that would stick around forever because of what could easily be seen as a fail-proof model. Users submit content, others pick the content of choice, and people use the site because of the content. All of this was headed up by people of celebrity status to boot. How could something like this possibly go wrong?

Well, many are blaming various site changes, site management policies and an increase in sponsored content and other advertising. Whatever the case may be, whether it’s a combination of issues or what, the site went into decline. Users lost interest in the site. Other sites eventually found an edge over Digg and gained in prominence. Digg today just isn’t the backroom buzz word it used to be.

Now, news is circulating that seems to signal to a lot of people that the fun ride that Digg was is now over with. TechCrunch is reporting that Digg was sold to a few parties for about $16 million:

Sun Valley and self-driving cars aside, the story of the day today is that social news site Digg has sold its remaining assets for $500K to the NYC-based tech firm Betaworks. While that number is indeed in the ballpark, we’re hearing from multiple sources that the total price of the Digg acquisition was around $16 million, including the price paid for IP by a previously unreported acquirer, LinkedIn.

According to a familiar source, the Washington Post ended up paying $12 million for the Digg team. Around the same time, career social network LinkedIn paid between $3.75 million and $4 million for around 15 different Digg patents including the patent on “click a button to vote up a story”.

Betaworks picked up all the remaining assets today, including the domain, code, data and all the traffic for between $500k and $725k. We’re hearing that Borthwick and co. will license from LinkedIn whatever patents it needs to execute on what it chooses to do with those assets. I have no word on how the “single-digit millions equity deal” some are reporting fits in here exactly.

It’s unclear if this really spells the end of an era for Digg, but it certainly doesn’t look good at all when the site is sold in this fashion. Sure, YouTube was at one point sold to Google, but YouTube was gaining huge momentum at the time, not falling further and further behind in the way Digg was.

Whether not Digg can somehow manage to reformulate itself and make a comeback remains to be seen, but it’s increasingly looking likely that Digg has become a site that once was and now isn’t anymore.

(Via /.)

Drew Wilson on Twitter: @icecube85 and Google+.

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