Can You Digg It?

The Digg Bang Theory: Can Betaworks Make a Run on Reddit?

The NYC startup factory takes a gamble, with the hopes it won't get buried.
 The Digg Bang Theory: Can Betaworks Make a Run on Reddit?

Mr. Rose (Photo: flickr.com/joi)

In the winter of 2004, soon after the husks of once-great dot-com startups had dried and shriveled, a 27-year-old college dropout named Kevin Rose deployed a barebones new site, simply named “Digg.”

It was one of the first social networks in existence. Back then, the term “social networking” hadn’t shouldered its way into our lexicon yet. Facebook was a nascent, walled platform for college gossip; Google was still idly toying with its search algorithm; Twitter wouldn’t launch for another two years.

News itself was a hierarchical affair, largely produced and disseminated by trusted broadcasters and editors. Journalism’s democratizing forces hadn’t congealed, yet; bloggers weren’t sitting front row at fashion shows or making a living off of Google Ads. The idea that a community of Internet geeks could manipulate the news cycle would’ve elicited howls of mocking laughter from the Conde kingmakers.

Mr. Rose, then an occasional tech TV talking head, launched Digg with the notion that it would change all that. Digg wants “to give the power back to the people,” proclaimed Mr. Rose in a 2005 preview of the website on the tech TV show The Screen Savers. By “digging” or “burying” links, users could effectively weed out the detritus and let the news they liked best filter its way to the top. The site’s functionality gave users the power to decide what deserved to be seen, and they were rewarded by spotting links early that would eventually become popular. Diggers garnered further clout by interacting with each other. Real power users began to emerge, enabled by their nimble maneuverings on the platform.

These days, stodgy publications like The New York Times pen fawning profiles of BuzzFeed bloggers and Business Insider newshounds, seemingly entranced by their mystical ability to foresee what will go viral. But Digg’s power users are the predecessors of keen-eyed bloggers, and Digg gave them the platform to broadcast their Internet soothsaying abilities. “The service forced me to get very good at finding news and interesting stories — and doing it fast,” wrote one-time Digg power user, former tech reporter and current venture capitalist M.G. Siegler in a recent blog post. “It also forced me to hone my headline writing skills…. Without Digg, I almost certainly would not be where I am now.”

“It was the first iteration of social news and social sharing,” Aubrey Sabala, an early employee of Digg, told Betabeat by phone. “In a lot of ways it was ahead of its time.”

But a funny thing happened on the way to the Internet revolution: following a handful of hefty capital rounds, mounting investor pressure put the focus on monetization. And some of Digg’s power users turned to the dark side, allowing advertisers and publishers to pay them for “diggs” so that their content could make it to the front page. In 2009, Digg rolled out a clunky ad experience, much to the chagrin of its fan base, which began to jump ship for Facebook and Twitter. A buggy overhaul of the site released in 2010 was the final straw: Digg crested the hill on its final decline, the majority of the site’s devoted users eventually decamping for Facebook, Twitter and Reddit.

But now Digg, the sleeping–or is it dead?–community giant, is getting the chance to redeem and recreate itself in the moneyed bosom of the New York tech scene, thanks to an acquisition by startup incubator Betaworks. Betaworks, nestled in the Meatpacking district steps away from the Highline, purchased Digg’s core assets just a handful of weeks ago, and set out to recreate the Digg experience from the ground up. What’s left of the Digg brand will be revived by the News.me team, another Betaworks social news startup that has been tapped to resurrect Digg’s decrepit corpse. And they’ve done it in just six weeks.

It’s an opportunity few startups ever get: to atone for their sins and start from scratch in a safety bubble, protected from the pressures of monetization and investor interests. They can build a purer product this time, learn from the lessons of Digg’s former incarnation, and hone in on accurately catering to the way users consume news.

But with its one-time competitor Reddit miles ahead in the race for relevancy, is it too late?

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 The Digg Bang Theory: Can Betaworks Make a Run on Reddit?

Mr. Borthwick with Mr. Siegler (Photo: flickr.com/techcrunch)

Less than 24 hours before the launch of the new version of Digg, Betabeat arrived at the Betaworks office, an airy, sprawling labyrinth of Apple products and side-by-side desks occupied by work crazed young people. We’d arrived just in time for a chocolate covered banana cart to show up, heralding a quaint office gathering celebrating the new Digg. Jake Levine, the former manager of News.me who became manager of Digg following the acquisition, told us that before the acquisition went through, he talked about Digg in codewords to his teammates. “We called it the banana stand,” he said, referring to a beloved Arrested Development plotline.

“Digg is one of the great iconic web 2.0 brands,” said Betaworks CEO John Borthwick in a clipped British accent, after we’d settled into a corner conference room littered with Betaworks stickers. (Sadly, there would be no frozen bananas for this Betabeat reporter.) Through the glass doors, we could see a red pole strung up with a Guy Fawkes mask, the universal symbol for the hacker group Anonymous. “It helped define a whole new wave of company creation and innovation,” Mr. Borthwick went on. “But also this idea of socially curated news is something that they helped create.”

It was a pure idea, but the infusion of capital, coupled with the inherent drawbacks of the Digg voting model, ultimately led to Digg’s demise. “The company raised a lot of money maybe a little bit too fast and couldn’t figure out how to make money and then sort of went through a painful process of growing downwards,” Mr. Borthwick admitted. “Sometimes companies get pumped up like athletes full of steroids, so much so that they’re really strong and fit but they can’t actually walk any longer so they kind of fall over on their own weight.”

In short: mo’ money, mo’ problems.

Follow Jessica Roy on Twitter or via RSS. jroy@observer.com

Comments

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