Wednesday, October 25, 2006
Digg Flirts But Gets No Action
According to TechCrunch Digg has been talking to News Corp. and others about being acquired but hasn't found anyone willing to pay their asking price of $150 million.It seems strange that today $150 million may seem like chump change when compared to MySpace or YouTube, but those sites had many more users and the potential for a business model beyond ad dollars.
What is Digg's value? Well, they have lots of eyeballs of assumingly educated users, and proprietary technology for rating articles posted on other websites. The site is a content aggregator, but the general idea could be cloned fairly easily, and I don't feel the "stickiness" that advertisers love.
So is a portal website with flat traffic and no unique content worth a Powerball-sized payout? Digg's audience likes the user-determined filtering, and anyone who gets Dugg certainly appreciates the traffic. But if a Yahoo or News Corp. were to buy them, would their be internal pressure to link to in-house websites more?
If Digg does find a taker, it could open the door to more aggregation/content sites being acquired, and indicate that the Web 2.0 craze will continue unabated. Should they remain independent and not grow much bigger, Digg could be an indication that some of the bloom is off the Rose, so to speak.
Posted By John Gartner at 02:00 PM
Permanent Link: Digg Flirts But Gets No Action
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