Updated: Chas Edwards Leaves Digg For Pixazza; Digg Lays Off 25

After a year and a half, Chas Edwards is exiting Digg as its chief revenue officer to join photo ad network Pixazza. The departure comes amid a wider change in Digg’s “product focus” along with plans to layoff 25 staffers, or roughly 37 percent of its employees, according to a blog post by CEO Matt Williams (via Techcrunch).

In the blog post, Williams said the layoffs are necessary due to “a burn rate that is too high.” In order to achieve profitability in 2011, Williams said that there will be a range of expense cuts as well. “We’ve considered all of the possible options for reduction, from salaries to fixed costs,” he wrote. “The result is that, in addition to lowering many of our operational costs, I’ve made the decision to downsize our staff from 67 to 42 people.”

Earlier in his career, Edwards formed Federated Media with John Battelle. Edwards left the company in May ’09 as publisher and chief revenue officer to go to Digg. The social news sharing site has had a more difficult time since founder Kevin Rose was celebrated on the cover of BusinessWeek in 2006. Edwards will remain as an advisor to the news sharing site.

Edwards’ departure, which was first reported by AllThingsD comes amid continued turmoil that erupted after long-time CEO Jay Adelson left in April. His leaving was accompanied by a severe round of layoffs. In August, the news aggregator hired ex-Amazon (NSDQ: AMZN) exec hired Williams to replace Adelson.

Over the summer, Pixazza raised $12 million. Google (NSDQ: GOOG) was an early investor in Pixazza, which embeds ads onto photos which pop up when a viewer mouses over them.

In his blog post on his personal site, ChasNote, Edwards said that Pixazza sounded a lot like what he had created with Battelle six years ago (it should also be noted that Digg was an early FM client).