Digg: Lots of Buzz But No Profits
Digg is still figuring out how to monetize it’s traffic. Display ads are’nt cutting it. In 2007, the ads brought in $4.8 million and the company lost $2.8 million. 2008 was not much better. In the first three quarters of 08, Digg brought in $6.4 million and lost $4 million.
When you are one of the most talked about websites on the Internet, and you have revenue numbers that bad, there is definitely a problem. Digg has raised a total of $40 million in funding. It’s last funding round valued the company at $164 million. The company has tried to sell itself many times. Their last “almost acquisition” by Google went south.
Digg’s CEO Jay Adelson says he plans to make the company profitabe in a year. Digg is exploring a user-driven advertising platform. They may also be cooking up other things to increase revenue.
Nevertheless, Digg’s traffic will continue to grow. The company has enough cash on had to ride the recession. And someone will eventually buy it.