Technology & Science

Digg sale to Microsoft or Google imminent: report

User-driven news website Digg is on the verge of being sold, with Google Inc. and Microsoft Corp. as two of the potential buyers, according to a report.

User-driven news website Digg is on the verge of being sold, with Google Inc. and Microsoft Corp. as two of the potential buyers, according to a report.

The website has been working with investment bank Allen & Co. on a sale for several months, but a deal is now imminent, according to the influential technology blog TechCrunch.

Citing an unnamed source close to the deal, TechCrunch said there are four companies looking at Digg's books: two of them are large news and media companies, while Google and Microsoft are the other two.

Digg is prepared to accept less than the $300 million US that Allen & Co. was seeking last year, with Google likely to bid up to $225 million, the report said.

Microsoft would likely offer less than Google because part of Digg's revenue comes from an advertising deal the site signed with the software company last year.

The two companies are expected to engage in a bidding war over the website, which ranks news stories according to how many votes they receive from visitors.

Despite the rumoured sale, Digg founder Kevin Rose last month told CNET that he was hesitant to sell the website.

"I've had several friends that have been acquired by the Yahoos and Googles of the world, and while there is some upside in certain things, for the most part, it slows things down," he said. "You can't get a product out the door fast enough."

Yahoo's name is not being mentioned as a potential buyer for Digg, largely because the company launched its own news-ranking website last month, called Buzz.

Yahoo's site adds a twist to Digg's ranking system in that it incorporates how many search queries have been made on the story's topic.