It may be one of the higher profile acquisitions of the year if true, but CEO Jay Adelson of Digg denies claims that Microsoft or Google could be purchasing Digg.com for $300 million. TechCrunch, the original news outlet that reported the story insists that their source is still accurate despite the denial.The original news story said that four major companies are in a bidding war to acquire the most popular social news networking website digg.com. Digg is frequently known among administrators of news sites to bring spikes of traffic to their website whenever a story gets "Dugg". The claim is that, among the companies involved in the bidding war, two of them are Microsoft and Google. TechCrunch's source says that Google is looking at a $200-225 million bid. No word on what Microsoft will bid, but it's likely that, if true, a bidding war between Microsoft and Google will likely follow in the coming days with two other media companies in hot pursuit of the ownership of the website. It seems that Digg wasn't happy about this news surfacing and responded saying, "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." "Adelson could be acting a bit cagey here. The original report on TechCrunch never mentioned a "bidding war" per se, just that four companies were in the running to acquire the company." Caroline McCarthy of CNET said in a blog entry, "The "bidding war" phrase in Adelson's post could have referred to embellished rumors and speculation that subsequently floated about the Web." "Do note what Jay didn't say: "We're not for sale, we're not selling to Microsoft or Google, and we're not selling to anybody else, either." So he's actually left himself plenty of wiggle room if the company does trade hands." Writes Peter Kafka of Silicon Valley Insider, "Digg is perpetually supposed to be for sale, but no one ever buys it. Perhaps Jay, Kevin, et al really aren't interested in selling. Perhaps they still haven't seen a price they like. But if Allen and Co. really is shopping the site, then someone out there has actually seen the book, and can give us a real sense of the supposed valuation they're looking for" The CBC notes that Kevin Rose, the founder for Digg.com mentioned how once a site is acquired by a larger company, the site slows down because product can't be pushed "out the door fast enough." So it's a CEO's word vs. TechCrunch's report. If Digg really is sold, it may likely earn the scorn of a number of fans of Digg.com for "selling out", though if TechCrunch is wrong, then their credibility they built up for some time may take a hit, but otherwise, things will remain status quo. The idea of Microsoft and Google wanting to buy Digg.com does make some sense. Microsoft had been rumored to be trying to buy Yahoo! in a bid to compete against Google in the search engine market. Google, on the other hand, did, in fact, purchase DoubleClick and popular video sharing site YouTube, thus increasing their online market share substantially. There's little doubting that Microsoft wouldn't be happy being a distant online competitor in a technological market and would likely do everything possible to, at the very least, be a serious competitor. Either way, many news outlets are keeping a close eye on the situation for any new developments. If an acquisition does occur, it wouldn't be hard to learn about it quickly. |
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