I know these reports have been going around, but I have the inside line and figured it was time to share it.
A PR/marketing firm confirmed with me that they had a number of the top 50 users on digg now on the payroll–and this wasn’t a totally insignificant firm.
The problems that digg is facing now is that a portion–certainly not all–of the top users feel like they should be getting paid for the 3-4 hours they spend on the site each day. Since digg will not pay them for their work they are finding other ways to get compensated.
Note: The Navigators at Netscape are not being paid by the PR firm, and if they ever do something on the side they will have broken their contract and would be fired immediately. Of course, the other users on Netscape could be getting paid just like the ones on digg are–however at Netscape you have the paid staff to turn this stuff off. The PR/marketing person I talked to said they can get a significant portion of their stories up on on digg. Ouch.
Will this problem kill digg? Nope, because the audience can bury things.
Will this problem undermine trust in digg? Of course.
My prediction is social news sites without a paid staff of editors cleaning the site up will be less trusted than ones with editorial staffs.
Note2: I no longer work at Netscape obviously. However, I still care deeply about the space.