Maybe it’s just the summer heat getting to people, but TechCrunch swears that this time it’s for real, and Google (GOOG) is on the verge of buying Digg for “around $200-million.” Yes, this is pretty much the same rumor that was going around earlier this year, but Mike Arrington says the talks are back on (apparently Marissa Meyer lost interest in the company for a while).

But does it make any sense for Google to do such a thing? Eric Eldon wonders why the Web giant wouldn’t just build its own Digg, just like Yahoo (YHOO) did with Buzz and AOL did (with somewhat less success) at Netscape, which was later relaunched as Propeller.

I think this rumor has some legs, not because I have any kind of inside contacts at Google, but because I think a combination of Digg and Google News would make for a pretty attractive property in a lot of ways. It didn’t seem like a great fit when Digg was mostly just tech-focused, but as the service has broadened its appeal I think it has come closer to something Google would be interested in, although how much Digg has really expanded its readership is open to debate.

The Internet behemoth has an obvious interest in the social side of content delivery (when you think about it, PageRank is a form of crowd-sourcing) and it might juice things up a bit at Google News — or even the search side, where the company is apparently testing user input on search results.

It goes without saying that even if the two are talking about a deal, it could go off the rails at any point over issues like price, control, etc. But all in all, I think that a combination makes some sense. If nothing else, I’d like to see what would happen if Google combined Digg with Google News or turned the Digg algorithm loose on search.

• 60% of Google Employee Stock Options Are Drowning  »
• Web Ad Revs Up 15.2% in First Half  »
• Amazon, Rhapsody Gain in Digital Music Market ; iTunes Still Top Dog  »
• Google: Android Skepticism, Plunging Stock  »
• Another Dumb Idea From Google   »

Mathew Ingram

• Bio & more articles
• Visit Mathew's blog