Once Powerful, Digg Now Worth Less Than MySpace
posted Saturday Jul 14, 2012 by Scott Ertz
Just about everyone on the Internet has had some sort of interaction with social networking pioneer, Digg. If you are reading this on our website, you can even see its integration at the bottom of the article. Just because you know of it, however, does not mean that you use it. That is the problem that has led to this week's decision to sell the remaining assets of the company to Betaworks for a mere $500,000. Compared to the $35 million MySpace sold for, that is pretty insulting.
Now, that is not to say the company was only valued at $500,000. The remaining assets involved only the domain, code, data and traffic rankings. All of the patents held by the company, such as the "click to up vote" patent, have already been sold to LinkedIn for around $4 million, with licensing rights to be given to Betaworks. In addition, the team has been sold to the Washington Post for $12 million. That brings the total in at about $16.5 million, still far below the value of the other once mighty social giant, MySpace.
So, what went wrong and what does founder and former G4 host Kevin Rose have to say about the end of an era? Hit the break to find out.
What really went wrong for Digg was a lack of understand of who they were and being proud of it. As they saw their numbers drop, instead of embracing what the network was they tried to incorporate the things that the other networks, such as Facebook and Twitter, are. Kevin Rose said about the change, "We were desperately trying to figure out how to get traffic back. A bunch of the community had already revolted by the time we fixed it. We did a lot of things that went against the DNA of our product."
Another problem was Facebook and Twitter became better at what Digg was than Digg. "Twitter became a major place to find out what was breaking on the Internet. Facebook became a place to share links. Social media really grew up." Unfortunately, in a final attempt to regain relevance and retain speed on the network, the company remodeled the site, both front-end and back. They replaced their MySQL database with another open source garbage platform, Cassandra. Not surprisingly, the re-launch with the broken technology did not go well, sealing the fate of the company.
There is no telling what will happen to Digg going forward. The brand might cease to exist entirely, or Betaworks may have an idea to give the brand life again. All we know right now is that the development team is gone, as are the patents, meaning all that is left is a brand name, logo and domain name.
