Not all that long ago, in 2008 to be precise, Google was set to drop a staggering $200 million to buy Digg. Now it is being sold off to Betaworks for a mere $500,000.

What does that $500,000 buy? Everything. Betaworks gets the Digg brand, the website and the technology – all of which will be rolled into News.me, Betaworks’ social news aggregator. Employees, were not part of the deal, but Digg CEO Matt Williams can look forward to a soft landing – he will join venture capital firm Andreessen Horowitz as an Entrepreneur In Residence.

Digg CEO Matt Williams explained the nuts and bolts of the move (but not the price in a blog post:

Today marks the next stage in Digg’s future.

Believe it or not, it’s been seven years since Digg launched. To date, we’ve had over 350M Diggs, 28M Story Submissions and 40M Comments. We’re extremely proud to have helped pioneer social voting on the web.

Digg has always been a site built by the community, for the community. Over the last few months, we’ve considered many options of where Digg could go, and frankly many of them could not live up to the reason Digg was invented in the first place — to discover the best stuff on the web. We wanted to find a way to take Digg back to its startup roots.

We couldn’t be happier to announce that the next generation of Digg will live on with the team from Betaworks. Betaworks is combining Digg with News.me, a Betaworks company with an iPad app, iPhone app and daily email that delivers the best stories shared by your friends on Facebook and Twitter. Digg will join a portfolio of products developed by Betaworks designed to improve the way people find and talk about the news. Betaworks founder John Borthwick will be the CEO of the new Digg.

Kevin wanted to share, “I’ve always been a fan of John’s product vision and the companies he builds, funds, and advises. John understands the real-time nature of the web and how to capture and surface trends as they occur. Given his experience with bit.ly, news.me, and Chartbeat I can’t wait to see what he does with Digg.

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