Here’s the latest action:

Digg, the news-ranking site, signs big advertising deal with Microsoft — It is similar to the one signed by Facebook with Microsoft, says co-founder Kevin Rose.

stage6.jpgDivx to spin off its Stage6 video-sharing site: Stage6, a site featuring user-created videos that uses technology from its publicly traded parent company Divx, has been growing so fast that Divx has experienced a sharp up-tick in operating expenses, lowering its overall operating income. So San Diego’s DivX will spin out Stage6, which will now seek venture funding. Unique visitors to Stage6 numbered 10 million in June, up from four million in April. DivX, meanwhile, focus on its core business of licensing high-resolution video creation technology to device manufacturers — TV makers, mobile phone companies and others. The Divx “codec” or video compression-decompression software library, has been downloaded over 220 million times since the start of 2003, including 70 million times in the last 12 months, the company said in a statement.

Facebook lawsuit continuesFacebook, responding to a suit filed against Facebook’s Mark Zuckerberg that alleges he stole code from an earlier company working on a similar idea, issued the following statement after a hearing: “We are pleased with the outcome of the hearing today. We continue to disagree with the allegations that Mark Zuckerberg stole any ideas or code to build Facebook. We intend to honor the judge’s request not to comment further in the media and will continue to vigorously defend this case in court.” This comes after presiding federal judge signaled he thought the suit was merely an effort to extract payment from Facebook, saying that “dorm room chitchat does not make a contract.” He gave the plaintiffs two weeks to file a revised complaint.

AideRSS puts article quality under microscope: AideRSS, of Waterloo, Ontario, is launching an online service where you can sort, track and filter RSS feeds. You can see how many times an online article has been commented on, “dugg” on Digg, tracked in Bloglines and how it has fared in a variety of other social news. VentureBeat’s RSS performance here. We played around with it and found some other features handy, like a way to import feeds from Google Reader and other feed readers so you can analyze all of your favorite blogs and web sites.

Toyota introduces a plug-in hybrid vehicle that you can plug in to an electrical outlet — It will introduce the car in Japan first, and test it in the U.S. The car will use “good enough” nickel-metal hydride (Ni-MH) batteries and have an eight-mile all-electric cruising range. (Details here)

GreenFuel Technologies, the alternative fuel company that had problems with its algae production, has raised a $5.5 million bridge loan — It is led by Access Industries, Draper Fisher Jurvetson, and Polaris Venture Partners (Bob Metcalfe’s company). Metcalfe last month became interim CEO of Cambridge-based GreenFuel after a series of setbacks sent the firm reeling, forcing layoffs and causing the company to scramble for additional financing. (Source Xconomy)

Google keeps buying stakes in Indian investing firms — Google has joined the investors of Delhi’s Band of Angels (BOA), we’re hearing from Sahad of VC Circle. Google had recently acquired 30 per cent of Ventureast TeNet Fund II for $3.75 million. Google had also previously invested as a limited partner in two early stage funds — Erasmic Venture Fund and Seed Fund. Sahad, who blogs about Indian investors, also notes that Canaan Partners, another valley firm that began investing in India lately, has invested in career-focused professional networking site TechTribe in a sub-$10 million round including Silicon Valley’s The Entrepreneur’s Fund III and Miven Venture Partners.

Tech blogger Om Malik is launching a television show with video site Revision3 — AllthingsD reporter Kara Swisher has the news. His first three interviews, to air weekly for about 10 minutes, are with RealNetworks’ Rob Glaser; Seagate’s Bill Watkins; and entrepreneur James Hong of HotorNot fame.

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