Rumor: Microsoft and Google Digg Deep

by Brian Solis

Kevin Rose, Shot at the Worlds Collide Party

About a few months ago, Digg hired a-list investment bankers Allen & Co. to shop the company to potential buyers.

Today, I read that two companies may be ready to offer between $200-$300 for the user-generated news service. Who’s ponying up? Rumor has it that both Google and Microsoft are mulling over offers.

No doubt that Digg is a fantastic service. Other competitors, including Mixx (recommendations) and Hubdub (predictive markets) are starting to showcase innovative and engaging formats however, that might make this the right time for Digg to sell and help it stay in its leadership role.

Fred Wilson pondered whether or not Digg’s rapid rise to stardom may be flattening, “A slowing growth rate doesn’t mean that Digg is a bad business. It’s probably becoming a better business because they are probably monetizing it better than ever these days.”

Here’s Digg’s US unique visitors:

He suggests that the New York Times may be a better suitor for Digg since it proved it could turn an investment into a profit center as it has with About.com.

Either way, this will work out for the team over at Digg and free them up to focus on Revision3, Pownce, and the next big thing.

UPDATE: Digg responds, says rumors are false. See Jay Adelson’s post on the Digg blog.

“Normally our policy is to not comment about things like this, but this morning’s rumors about a bidding war involving Google and Microsoft have created such a stir we feel compelled to tell you all directly that they are completely inaccurate.

Sorry to burst any drama theories, but they aren’t true. We remain focused on improving Digg and rolling out great features.”

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