Should have been more. In fact I predict it will be more... the phrase "death of a thousand cuts" comes to mind.

now i understand that it's very hard to develop good software (marketing software none-the-less), but could this kind of thing, in the long run, hurt the big advertisement companies?

What do you mean? Digg's decision to build their own ad team in-house?

yes, if this team means that they are planning on going out and getting their own advertisers.