DISQUS

Web Design Beach · 12 months ago

It is really surprising how such a big company has such a weak adverting system. Almost unbelievably. I guess they could earn more with targeted ads from Adsense.

Stuart Foster · 12 months ago

Digg's current strategy for business development is completely backwards instead of bringing in the best people on the site for meetings and calling them to talk strategy...they ban them. It seems to me that the IT side has way to much sway over at Digg, and thus their business is going to suffer severely. Digg could be an amazing site, bring in ad revenue, provide partnership opportunities for companies, and a variety of other marketing solutions...but they remain steadfast in their commitment to mediocrity. Ridiculous...

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Andrew · 12 months ago

could have been.. 300 mil.. Man. They really screwed that one up, huh?

Andrew's last blog post..The Girl Who Loved Tom Gordon

Kenney and Kim · 12 months ago

Interesting find... untargeted ads. This is obviously super important and easy to fix. Hopefully they are monitoring alerts so they'll get this post and stop loss ; ) I don't know how that will go selling to Google though considering they were going to get sued for becoming a monopoly earlier this year when trying to work a deal with Yahoo. I mean they are really being watched. So much exciting drama online, can't wait to see what happens...lol

Milo · 12 months ago

they definately will sell Digg, and I can guarantee it will be to Google.
Who have Google bourght out recently? YouTube, MySpace, FaceBook? Who else is going to be next?
Hopefully they'll buy out Twitter, cos it sucks

Gary · 12 months ago

Why does it cost 6.8 million to run digg?
They should be able to run the whole thing for less then a mil!

bandwidth can't cost them that much.

should be able to run the whole thing with just 10 guys not much to digg all the content comes from users. how much does the CEO get?

For sports they should be trying Satellite TV ads and maybe sports illustrated ads they should also track user and show them different ads one of the big mistake yahoo and MSN make showing the same ads over and over gets annoying

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JR @ Internet Marketing · 11 months ago

This is certainly gross mismanagement on their part, unbelievable to see such losses with such high traffic

JR @ Internet Marketing's last blog post..Some A-Hole Stole My Content - How to Fight and Prevent Copyright Infringement

iPhone · 11 months ago

it's probably 300 mill because they waste money on stupid things.
have you seen all the little nifty features they have installed recently? Unnecessary, and silly to waste money on such little things, especially during a credit crunch time like ours

rumblepup · 11 months ago

Wow, with the supposed brain trust behind digg, you'd think this would be, sorry the pun, a "no brainer." But as already stated, mismanagement will always bring down even the biggest of ventures.

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Karlonia · 11 months ago

I definitely agree with the sentiments of Gary above - why is it costing so much to run Digg, especially considering the fact that their model is set up for site growth from user-generated content? They don't need to do much original writing or outsourcing of articles. Apparently most of Digg's expenses are related to payroll - too many people as administrative staff, perhaps with some them being paid more than is necessary.

From looking at the BusinessWeek numbers, it seems like Digg could become profitable fairly quickly just by cutting costs even without factoring in the revenue side of the equation. And of course, as almost every site that has been reporting on this story has noted, if the obvious problem with untargeted ads is fixed, those revenues could rise sharply.

Combined with implementing some simple cost-cutting measures, Digg could probably increase the real market value of its site several times over if it really wanted to.

Darren Tan · 11 months ago

They should have sold Digg last year.. But again, if they stay long enough and hire some marketing experts to build their business, they should be alright. And remember, not everyone on this planet has a Digg account and not every single person has access to the Internet. Once the real globalization happens and sweeps across the globe, i bet every single person on earth will know Digg. Even 90% of my friends don't know what Digg is..

If they are as popular as Facebook and Myspace or even Youtube, i think they shouldn't be facing this problem right now.

Every business has its ups and downs, it all depends on their choice of solution and determination.

We'll cheer you on Kevin Rose! :-)

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Free Backlinks · 11 months ago

Interesting, but I think they're desperately looking to increase the time spent on the site in a bid to inflate the price - more time spent means more captive audience = worth much more. They're concentrating on making it from a social news platform into a platform that recommends interesting stories based on your digging pattern - problem is that people will continue to drink the koolaid and digg what friends send in attempts to exchange diggs - so the whole thing won't play out well.

Jose C · 11 months ago

This is crazy,There is no reason Digg should be losing money. I can only see two problem's why they are losing money. One they should have got out while the getting was good. With all these big website's be sold and estimated at billions, the people at Digg probably thought they would hold out for more money. The second reason is misspending. In an attempt to try and make the site more valuable, they ended up misspending money. This of course is just my opinion, but I wouldn't be surprised if I was right. They need to fired what ever firm is managing their monies, and handling their advertising. This is a case of the people at Digg trying to hold out for more money, and wasting money on failures in an attempt to raise the value. It kind of makes you wonder if the people at Yahoo made a mistake by turning down the 44+ billion from Google. Websites are not like a fine wine that gets better with age...Until people lose the capability to come up with great idea's, Their is always going to be new and fresh Idea's that will eventually surpass yours. Digg is still a valuable site, but when in the pursuit of more money, mistakes can happen.The people at Digg should have took the 300 mil and let someone with more money and resources take over. People now a days think that you have to hold out for a ridiculous amount of money, But the truth is, Digg could have sold the site for 300 mil and came out with another 300 million dollar idea. keep up the bad work :)

PS3 · 11 months ago

What sort of money are we talking about if Digg put the site up for sale?

Xbox 360 · 11 months ago

@ PS3, Billions surely.
It's a potential goldmine, imagine all the sapce that could be sold as advertising?

Saad Kamal · 11 months ago

@Xbox360 - Billion? Nah.. I don't think so. I think the most ever in the valuation was 300 or 600 Mil. Can't remember the exact figure.

Saad Kamal's last blog post..Google PageRank Update Q4 2008

Utah SEO Pro · 11 months ago

Digg's lack of valuing users is hurting pageviews and thus revenue.

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Weight Loss Blog · 11 months ago

How the hell do you bring in almost $5 million and still end up losing almost $3 million. Where are the costs for Digg? Servers and bandwidth? How much are they paying their employees?

20 million uniques a month and you can't turn a profit. That's ridiculous.

Steve

Weight Loss Blog's last blog post..Stop Counting Calories

R&B Love Songs · 11 months ago

For Digg's size, their ads have been terrible. They need private ads fast. They should have better ad deals lining up for them.

BUT, youtube was sold and they were losing money fast so it's not out for digg.

jason kuiper · 11 months ago

Wow, not a time to be mismanaging a company. That will sink someone real quick!

Silvia · 11 months ago

THat is what they are going to do.

thewutzupphilippines · 11 months ago

i think digg is a good buy however things are not doing well with their ad campaign

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Jacques Seoman · 11 months ago

Hmmmm, it does seem like there is room for some proper management and decision making at digg. The problem of non-targeted ads shouldn't be too difficult to overcome, it would make sense to get it working properly before trying to sell it.

Patrick · 11 months ago

This would be the best time for somebody like Google or Yahoo to give them a offer for a little more than they are worth and revamp their ad campaign and make tons of money off of the site.

Patrick's last blog post..Proximity Hotel: Greenest Hotel in America

Shirley · 11 months ago

Wow. Digg is overvalued in my opinion. And I think that this is a good time for a buyer. The smart buyer - Google or Yahoo - would then make obvious improvements to increase revenue.

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Web Design Showroom · 11 months ago

You'd think they would have got this right by now! It's a lesson to all of us though

Wii · 11 months ago

I think digg will be sold eventually and it will probably be google that gets their hands on it. It will just be another string to their bow to go with youtube and blogger.

Website Marketing · 11 months ago

Then need to spend a year building their brand and improving revenue and then sell!