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Could Digg be used for Sun stock manipulation?
Something extremely weird is going on over on Digg.com. Today for the third time in a short period, a story got promoted to the front page where a blogger raises a baseless rumour about Google buying Sun. And as is explained further down, it appears that this is the result of a coordinated effort to fool Digg into promoting the story.
The blog author has no sources, zero credibility and most importantly his reasoning is completely erratic.
It all kicked off when author Daniel M. Harrison on 26 February put up a post discussing Google's stock price, and then out of the blue predicts that Google will acquire Sun Microsystems. As proof, he points out that Google CEO Eric Schmidt is a former Sun employee. Secondly Sun CEO Scott McNealy has recently "received 10 million dollars in Sun equity". The blog author fails to explain how that proves a pending sale, and leaves out the fact that McNealy cashed in his stock options and sold the stock the very same day, as SEC filings show.
On 7 March, a second posts goes up referring to a Forbes article in which a financial analyst predicted the departure of Sun CEO Scott McNealy. Google played no part whatsoever in the Forbes story, yet the blogger connected those non-existent dots.
In a third post Harrison used the fact that Sun employees read his second post to claim that there is credibility to his theory. Amazingly, the post makes it to the front page on Digg.com. Apart from the ridiculous assertion that Sun employees reading the posting is proof, the blog author makes a fool of himself when again points to McNealy recent stock transaction but now attributes it to an "anonymous source" instead of an SEC filing.
Today in a fourth post he notes that Sun stock has been up slightly, adding a mere $500m to the company's $16bn market capitalization, and again sees that as proof for his theory (as in: insiders are spending their life savings to strike it rich when the deal is announced. Except that the SEC investigates all insider trading around major mergers). He also points to the fact that a blog on the New York Times' website (which he amusingly claims is "the most authoritative source of financial information on Wall Street") picked up his posts. He conveniently leaves out the fact that the New York Times blog concludes: "according to people involved in the partnership, the speculation is unfounded — at least for now."
Regardless of the credibility question, it's very odd that all these blog posts make it to the Digg.com front page.
The first blog post never makes it to the Digg.com front page, but with 33 diggs, it gets close. The blog author also tries submitting an identical posting on his personal blog to Digg.com, but it only got 9 votes. It's also the very last story that he submits and diggs - with that account at least.
The second post does significantly better, with 312 diggs.
Both the third and the fourth story do very well on Digg.com, and coincidentally are posted by the same person.
Even more amazingly, several users consistently turn up as early diggers for all of the stories: olseneric, ebrage, MarkIsCranky and ZRock.
They found the story even when it wasn't on the Digg front page, and decided to deem it Digg worthy. Or more likely: they have teamed up to manipulate the Digg voting system and get these posts promoted to the front page. Once there, any story will receive plenty of votes. Especially if it has one of the magic four in the headline: Apple, Microsoft, Google or Linux.
Eric Olsen, it turns out, is another author on the Blogcritics.org website - so there is definitely some teaming up going on.
I can only guess about the motives of this group. Hopefully they are just trying to prove that Digg is easy to manipulate – in the worst case, they are speculating against Sun's stock price for financial gain.
--
UPDATE: Just spoke with Digg CEO Jay Adelson. He said that there is no indication that anything extraordinary happened with the way that these Diggs got promoted to Digg's front page. He also said that: "I don't think it's possible to game Digg because it requires such a mass of people who have been vetted through our algorithms."
UPDATE 2: Talking to more some more folks and it seems unlikely that Harrison manipulated the Digg system to get his stories promoted. But they all agree that the theoretical threat is real (contrary to what Adelson says).
Sun and Google chiefs Scott McNealy and Eric Schmidt fall victim to only stock manipulation
Tags: sun microsystems, digg
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Interesting conspiracy theory. On the other hand, it could just be a blogger attempting to predict the future. This happens all the time as you know -- very high digg numbers for the non-existant widescreen touch video iPod, speculation about Microsoft's Origami, Google's webOS, and so on...
At any rate, I agree with your point on the "magic four", but think it's a bit farfetched to implicate a few users who happen to have the same interests and use digg spy (yes, that big 'dig spy' button on the right side of the digg UI... many people use that to find things in their interest not yet on the home page).
Posted by: danboarder | March 17, 2006 9:37 AM
Wouldn't doing this for financial gain be the same as trying to fraud investors by spreading lies?
Posted by: Anonymous | March 17, 2006 10:19 AM
If you look through the other articles that are dugg by some of the users you mention they only digg articles by a few select posters. If you look at olseneric's list of dugg articles he has 92 posts which he has dugg, of those posts 65 were posted in the last 46 days. Between those 65 posts that he dugg only 6 contributors are seen on the list: CPhillips, ebrage, pwinn, Willowtree, Huntjo, and aacool. If you then go to their pages you will see that they are all participating along with them to get their posts listed higher.
If you look at some of the posts that were dugg by them, but few others you can find a few more members that are participating in their scheme: mattlargo, satisfieddog, midnitcafe, gypsyman, sarcirohan, Tan The Man, patfish, Mark Schannon, Diana, and chkngrrl,
Posted by: keith | March 17, 2006 11:28 AM
LOL!
Posted by: kmarex | March 17, 2006 11:38 AM
its an interesting theory, and one that is plausable but I hope untrue. Did you think that maybe the four regular diggers could be friends of his who visit his website often and thought the post to be diggable? At least I hope that is what has happened, it would be a shame if digg became used like this, then any company or person who want propaganda spread could use those simple methods :/ maybe it is time for digg to implement a de-dig?
Posted by: Simon | March 17, 2006 12:09 PM
I voted for his story on reddit, not because it seemed credible but because it was bizarrely entertaining. Let's face it, any overheated story about Google's next move is interesting, even if just plain daft. I certainly won't be buying Sun stock any time soon. I think you're beginning to put 2+2 together and get 5 - exactly like he is.
Posted by: Neil | March 17, 2006 12:24 PM
Uhoh, SEC is investigating...hope this doesn't give others ideas.
Posted by: Crazoo | March 17, 2006 12:26 PM
This is why digg.com sucks.
Posted by: Anonymous | March 17, 2006 12:31 PM
This is why people should use slashdot. It's so better.
Posted by: Waohoo | March 17, 2006 12:43 PM
Why do you think the several diggers are different people coordinating together?
Its far more likely to be just one guy with multiple accounts. I'm surprised this never occurred to you?
Posted by: Digg Dugg | March 17, 2006 12:57 PM
w00t! Let the fur fly
Posted by: devboy00 | March 17, 2006 1:14 PM
Every one knows that digg is fixed. Why would some one post the same thing and get less than 10 diggs then another post the same thing and gets 1000's
Posted by: Roomba | March 17, 2006 1:16 PM
I found your story on the front page of Digg today. I poste a comment and for some reason the story has disappeared. I can only get to it by looking at stories I've commented on or dugg. Strange.
Posted by: TheKidd | March 17, 2006 2:18 PM
I've noticed before that I get more hits on my own blog for articles tagged with things like Sun and Google. The majority of early adopters of sites like Digg and Delicious are techies and so more likely to mark sites mentioning such companies. So, it doesn't take too many early, coordinated references to bring stories to the attention of people who would be inclined to bookmark them anyway.
Posted by: Phillip Fayers | March 17, 2006 3:41 PM
Phillip Fayers absolutely right.
All you need to do is to type "Google" in the title of your post....
Posted by: Will | March 17, 2006 4:42 PM
Could it just be that the several users who all dugg the stories early are simply regular users of Digg Spy? I tend to give more weight to the simplest explanations.
Posted by: Natch | March 17, 2006 4:51 PM
I do agree with you that there are serious problems with Digg and that it is ripe for manipulation. With all this hoopla over the success as Digg expands, I think its pretty clear that Digg is having problems. That kid who got 'hired' by google is another good example. Although I like Digg and ue it regularly, I find that the system is fundamentaly flawed for fraud, manipulation and baseless user hype.
Posted by: johnny | March 17, 2006 10:08 PM
"I poste a comment and for some reason the story has disappeared. "
This is what I consider the primary problem with Digg, misleading and sensationalist headlines. Inaccurrate articles (like the original Google/Sun Digg) tend to get buried fairly quickly, but the headline this article, which clears things up was posted with a very misleading headline. Instead of the speculation why someone is trying to work the system, instead the headline turns it into a statement of fact. So the correction/follow-up that states the truth gets buried along with the original story.
Posted by: DisposableRob | March 18, 2006 5:26 AM
it's so evident that Google will buy Sun. Instead of stupid speculations on digg manipulation or not, if you have deep knowledge about the two companies or do a few research on the net and take only a few minutes to mesh all the news, it will be clear.
Posted by: blje | March 18, 2006 10:56 PM
The truth is that there is a campaign by Blogcritics.org to get traffic to the site, and Digg (and other similar sites) are being used to do it. Select articles from Blogcritics are chosen to be submitted, and a cadre of Blogcritics authors and interested parties will Digg (or Shout or whatever) the submitted article. It doesn't have anything to do with stock manipulation, although the author of those articles selected may have other motivations. Interesting theory, though, and you do point out how sites like Digg can be manipulated by a small group of people. I'm surprised at how long it's taken for users to notice.
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