Remember Digg? There was a time when half the web was peppered with Digg widgets, the idea being that a few up-votes might bring a flood of viewers from the social media juggernaut. The site's founder, Kevin Rose, even made the cover of BusinessWeek in August 2006. The tagline was, "How this kid made $60 million in 18 months," and the cover story affirmed, "People in the know say Digg is easily worth $200 million."
Six years later, Rose is long gone from the company, and Digg has just been sold—apparently for much less than that lofty price. Betaworks announed yesterday that it "acquired the core assets of Digg," and a Wall Street Journal story quoting "three people familiar with the matter" claims the purchase price was a scant $500,000. That small mound of cash reportedly covered Digg's brand, website, and technology.
Cue the pointing and laughing. Everyone has picked up the Journal's story and brandished it as evidence of social media's fickle nature.
There may be a little more to it than that, though. The folks at TechCrunch say they've heard from "multiple sources" that the total acquisition price was closer to $16 million. TechCrunch doesn't contradict the $500K ballpark figure for the Betaworks deal, but it claims the Washington Post snagged the Digg team for $12 million, while LinkedIn made off with "around 15" Digg patents in exchange for a payment in the $3.75-4 million range. (Among the patents are one that covers "[clicking] a button to vote up a story.") TechCrunch claims Betaworks only acquired "remaining assets," including Digg's "domain, code, data and all the traffic."
Whatever the actual sale price, Digg may stop existing as we know it. According to Digg's Matt Williams, Betaworks plans to combine Digg with News.me, which he describes as a "Betaworks company with an iPad app, iPhone app and daily email that delivers the best stories shared by your friends on Facebook and Twitter." It's not clear how much of the original service will remain.