The original poster child for the Web 2.0 model and one of the first proponents of social media marketing, Digg has been sold for just £324,000 ($500,000) in cash plus equity – despite once being valued at $175 million.

It has been purchased by New York-based technology firm Betaworks, according to the Guardian.

Digg originally allowed users to vote stories that appeared on the site up to the top of the page – digging – or down to the bottom – burying.

Its founder, Kevin Rose, was featured on the cover of BusinessWeek in August 2006 and was the subject of one of the magazine’s features pieces. At that point it was ranked as the 24th-most popular website in the United States – beating sites such as Fox News (then ranked 62nd).

However, over time, people began to doubt the site’s ability to prevent users with multiple accounts from voting their content up to the top of the site to drive traffic to outside websites. Annalee Newitz, from Wired magazine, once claimed that she managed to push a pointless blog onto Digg’s front page.

Although Digg reportedly receives in excess of 16 million unique visits each month, the site’s ability to influence the Internet’s next direction has fallen by the wayside.

Betaworks published a statement on its site confirming the acquisition.

The statement read: “Digg is one of the great Internet brands, and it has meant a great deal to millions of users over the years. It was a pioneer in community-driven news.

“We are turning Digg back into a startup. Low budget, small team, fast cycles. How? We have spent the last 18 months building News.me as a mobile-first social news experience. The News.me team will take Digg back to its essence: the best place to find, read and share the stories the Internet is talking about. Right now.”

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