Digg Trying Hard — Maybe Too Hard — to Stay Relevant

Digg founder and CEO Kevin Rose

The new version of Digg finally launched for all users today, although the site had some teething problems for much of the morning. It was unavailable for almost two hours, and remained slow for some time afterward, with periodic errors when users tried to sign in or use Facebook Connect. The redesign of the link-sharing social network — which has been in invitation-only alpha testing for over a year — focuses on a Twitter and Facebook-style system of “following” other users and publishers, and gives users a new view called “My News” that shows links from those you follow as an alternative to an overall view of everything that’s been posted to the site.

The new Digg design is the first major launch since founder Kevin Rose took over as CEO after the departure of former CEO Jay Adelson, which involved some layoffs and a refocusing of many aspects of the company. While the site still has a hardcore group of devoted users, its traffic has declined over the past year or so, as other social-networking services like Twitter and Facebook — which many people use to share links that might have otherwise gone to Digg — have continued to grow at exponential rates. Statistics from Compete.com show that Digg’s traffic has recovered somewhat over the past few months from the lows of last year, but is still sharply lower than previous highs.

As Liz has written in the past, and I pointed out in my early review of the invitation-only alpha, the Digg redesign takes a number of cues from Twitter and Facebook, including the idea of “following” certain users when you sign up. While this may make the new site more familiar, it also runs the risk of duplicating content users are already seeing elsewhere. Most of the links that appear in the “My News” view when I login, for example, are links I’ve already seen in my Twitter stream, since I follow the same people and accounts there. In an interesting move, the “My News” view is now an option, while the regular “Top News” view is the default — during the alpha, the “My News” view was the default.

In a recent interview with Kara Swisher at All Things Digital, Rose said that the site is close to announcing a new CEO — the Digg founder and angel investor admitted that he’s not comfortable with the job, since he doesn’t enjoy managing people — and added that the company has had several months of break-even financial performance and hopes to become profitable soon. Rose said that the site has “double-digit millions” worth of revenue, and therefore doesn’t need to raise additional financing any time soon. Digg has raised a total of $40 million, including a Series C round of $28 million in 2008.

Walkthrough [sic] the new Digg with Kevin Rose from Digg Videos on Vimeo.

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