It was looking as though Google were about to add another acquisition to their collection by purchasing popular social bookmarking site Digg for a reported $200 million. However, it now seems that Google have pulled out of the deal in the final stages of negotiation.Prospective acquisitions of Digg have been the talk of the digital town for quite some time now with rumours abounding detailing a bidding war between Google, Microsoft and two unidentified media companies.
Any individual can post social media content on Digg, which can then be viewed by any user surfing their site and the more Diggs a story receives, then the more likely this content will make the front page listings of their website. A partnership could have brought yet more fans Google's way with Digg considered to hold one of the strongest communities in social media, but maybe the Mountain View giants were swayed by the not entirely positive reaction from a number of Digg aficionados. Many declared themselves apprehensive about a possible purchase by such a large corporation
It wasn't too difficult for Google to walk away from the deal, which they did during the due diligence stage of negotiations, meaning the search giants could view the technology and financial statements belonging to Digg before coming to a decision. As these term sheets are considered non-binding, it is possible to change opinion on a proposed deal, should there be elements of the organisation and product that are providing the purchaser with uncertainties. According to unnamed sources, there are rumours that Google suspected that the deal would not be workable from a personality perspective.
The news may come as a shock to some industry insiders, as reports at the beginning of the week indicated that the Google/Digg acquisition was likely to go ahead, but one thing we know for sure it's that Google isn't shy of the limelight and we can expect to see them hitting the headlines - on Digg and elsewhere - as they continue to capitalize on their established standing in search. However, if Digg is hoping to seek out alternative buyers they may find that their failed involvement with Google has influenced their chances of attracting new investors - their loyal fan base is sure to continue to support the social media site however.
