Digg gets $28 million financing by investors

By | Monday, September 29, 2008

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Digg Inc., an Internet startup that specializes in rating news stories, is making a little news of its own with a $28.7 million round of financing. The investment, announced Wednesday, should squelch recurring rumors of a sale to Google Inc. or Microsoft Corp.

"That's part of the message. We want to be independent," said Jay Adelson, Digg's chief executive. "We have only completed about 15 percent of all the ideas that we have. I don't think anyone could offer us a better deal than us going alone."

The money provides Digg with the means to pursue an international expansion and a hiring spree that is supposed to double its work force to 150 employees by the end of next year. Digg also plans to move into larger digs in San Francisco early next year and promote its brand more aggressively.

Highland Capital Partners and three previous Digg investors - Greylock Partners, Omidyar Network and SVB Capital - are providing the latest infusion. All told, Digg has raised $40 million since Kevin Rose started the service four years ago.

Rumors that Digg hoped to sell for $200 million to $300 million began circulating last year, with the buzz building in recent months amid unsubstantiated reports that the company was talking to both Google and Microsoft.

Digg would hold some appeal for both.

For instance, Google has experimented with a system that lets people vote on the quality of its Internet search results. If Google were to embrace the concept, Digg's methods for identifying the Web's highly rated stories and photographs could become invaluable tools.

And Microsoft already has financial ties to Digg. The software maker sells online ads for Digg under a three-year deal that expires in 2010.

Although he declined to specifically discuss the Google and Microsoft rumors, Mr. Adelson acknowledged there had been some "sniffing around" at Digg during the past year.

Privately held Digg doesn't disclose its financial results, but Mr. Adelson said its revenue has tripled during the past year. Digg remains unprofitable, but Mr. Adelson said it didn't need the additional financing to survive.

Dell laptops to use greener LED displays

Dell Inc. is switching to mercury-free light-emitting diodes, or LEDs, to illuminate laptop screens starting in mid-December, a move aimed making the computers softer on the environment and easier to recycle.

Dell said the LED displays consume less energy (43 percent less for 15-inch screens) than ones lit with CCFL - cold cathode fluorescent lamps - the technology that is standard in Dell's existing notebook computers.

The laptops shipping in December with LED screens represent about two-thirds of Dell's notebook sales, and include Latitude E models and two Precision mobile workstation models.

The Round Rock, Texas, company said LED back-lit displays will be standard in at least 80 percent of the laptops it sells by the end of 2009 and in all its notebooks by the end of 2010.

Dell's promise to use only LED displays in two years one-ups Apple Inc.'s 2007 commitment to get rid of the less-expensive fluorescent displays "eventually." Hewlett-Packard Co., the world's largest PC maker, also has begun selling optional LED-back-lit screens on some of its laptop and tablet computers.

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