When Digg launched its 4.0 version in August of last year, the social news site saw an exodus of users -- with many calling themselves “Digg refugees.” Its net value, $300 million in 2007, has plummeted to a paltry $35 million. The tech world has been waiting to see if Digg meets its doom or its redemption.

Today, Digg launches Newswire, a new feature that applies the literal meaning of the site’s title. In the company’s words, users can try “sifting for diamonds” or burying items in order to control what shows up in the news feed.

The limited beta allows each user to act as a curator for their own news. They can sort by recency or trends, and then filter by topic or media type. For example, a user can filter her view of the feed to populate exclusively with video files about technology, and then sort items by how new they are, or by how many times they’ve been Dugg (Digg’s version of the like button.)

Burying and sorting are nothing new. What’s radical about Newswire is that everything on it happens in real time, instead of in ten minute increments like on the Top News feed. Submitted stories immediately appear at the top of the feed. There’s also increased transparency. If you bury a story in Newswire, other users will be able to see just as if you had Dugg it.

Though users may at first be reluctant to reveal why, for example, they buried a story in the Politics category, Digg’s Will Larsen said on the company blog that it’ll be worth it:

“Your actions outside of the Newswire will still impact Newswire Trending, but activity within the Newswire is given a much higher weight: with transparency comes influence.” 

Tech blogs’ reception of Newswire has been positive but skeptical.

“This new feature could be a positive blip in Digg’s history, or it could just be another update gone unseen,” writes Erica Swallow on Mashable.

“‘Newswire’ may give Digg a well-needed upgrade by boosting the freshness of the articles, or may fall flat like other Digg enhancements – only time will tell,” writes Greg Finn on Search Engine Land.

The lone critic, Muhammad Saleem at Venture Beat, said Newswire isn’t actually new, but the latest incarnation of a previous feature. However, he was still supportive.

“All of the feature additions from Digg are actually a good thing... They are, however, features that never should’ve been removed in the first place,” he wrote.

New or not, the feature is successful so far. According to Digg:

“...We've had beta-testers suggest that we replace Upcoming entirely with Newswire (we agree, and are planning to phase out Upcoming as Newswire loses its Beta monicker!)”

Let the blogs be skeptical. If Digg’s optimism is to be believed, the users are happy and there might be a turnaround in order for this once great site.