Feedster rolled out a new look and new site features this week. The long-time RSS search engine and content aggregator has moved from a traditional search engine style service to one that’s a little more Web 2.0-ish, with a heavy focus on widgets, customization, and more buzz-style presentation of content.

The biggest change from the previous version is the interface. Gone is the traditional Google-ized search console (lots of whitespace). Instead, it’s been replaced by one that puts the focus on content and discovery by gently easing readers into stories that are separated into content categories.

In many ways the deemphasis on the lone search box model highlights a shift in strategy. Despite being in the RSS game as long as any of the other players, Feedster’s previous incarnation focused heavily on the search side of RSS and syndicated content. Now, with customizable tools and a more discovery focused approach, Feedster is hoping to capitalize on the same kind of success and traction in the content discovery space.

But the mountain in front of Feedster is a big one, and they’re at the bottom. The biggest challenge is at the heart of Feedster lies RSS. Though it’s a standards-based protocol, is ubiquitous with blogging, and enjoys integration with all major browsers and operating systems, RSS still has yet to make its way into the lexicon of the average internet user.

A 2006 Marketing Sherpa study on RSS notes that while at least 75 million US and UK users use RSS on a regular basis, only 17%-32% of RSS users actually know they’re using RSS. This study is over a year old, but if the percentages of users “in the know” has remained constant, that’s well over 50 million people who don’t know they’re using RSS.

The most recent movements in the RSS space have come from the Google/Feedburner acquisition. For the time being it has nothing to do with aggregating content but rather tracking the content that’s being aggregated. Yet, one has to think that if Google’s making a play in the RSS space there are a bunch of smart people out there that seem to think RSS is going to be big, eventually. But what side of big will it be on? Big to the publishers or big to the general Internet audience? Will consumers even care where and how they get their content - will they just care that they get content?

Herein lies the challenge faced by Feedster. Though the visual update is welcome, they have just entered the very crowded “content-discovery” space. Their service has always been perfect for people who know what RSS is and how to use it, but that slice of the market is very small. The refresh is good, but what’s coming down the pipe for Feedster?

Welcome to Feedster, Version 2.0 via [Feedster Blog and GigaOm]