I think the time is right to launch a site that is similar to Digg / Reddit but stays close to Digg's original ethos of catering toward tech.
I wouldn't compete against Digg directly. Digg is too mainstream. The good news is that they get lots of traffic due to branching out, but it has its bad sides as well. The discussion/comments on Digg aren't very interesting and the quality of the submissions have gone down.
I'd like to cater to the geek/tech niche. I wouldnt produce a Digg clone but rather roll my own software and try to differentiate as much as I can.
My question to you is does this sound like a decent idea or is it dead in the water? Also, what features would you like to see that could help differentiate the site from Digg?