Digg is an immensely popular website with a great concept. Each submission category is divided by topic – I like politics and education myself. Anyone who registers can introduce a story, and if other users are interested or entertained, they can “digg” the article. A digg is like a vote, and if a web page gets enough diggs in a quick enough period of time, it will be launched to the front page and subjected to more burst traffic than most shared webhosts can handle. (Cached and optimized sites usually survive this “digg effect.”)

A front page story might get 20,000 unique visitors, hundreds of comments, and 100-200 backlinks pointing back to the source article. As far as publicity and generating buzz in the blog-o-sphere, nothing else comes close.
Digg fully incorporates the social aspect of News 2.0. Users can make friends lists and send comments to friends in the form of “shouts.” A few people try to use friends networks to rigg the system, but Digg cracks down on this and offenders are usually caught and banned (their websites will usually be banned as well.)

Unfortunately, Digg might be a victim of its own success. There doesn’t seem to have been many upgrades to the network architecture or code efficiency despite its growing popularity. Today, a new user to Digg might first notice the unbearable slowness that the pages load, and never even notice the great content and features it provides.

Update:  Digg is in a bad state lately (as of October 2010).  Kevin Rose has stepped down as interim CEO and the last front page design has knocked a huge chunk off their daily traffic and membership activity numbers.  While they finally seem to have the slow speed issues solved, they’ve almost completely messed up the original democratic mechanism that made the site so interesting.