Friday, December 18, 2009

Google in Talks to Buy Yelp

By Kathleen Richards
Fri, Dec 18, 2009 at 6:06 PM

Word is spreading online that Google is in talks to buy Yelp, the San Francisco-based online review site that allows users to rate local businesses. According to one anonymous source, the price is set at more than $500 million. The move is seen as significant because it signals Google’s attempt to get in on the local business market.

Google has tried to get in on the local reviews craze, aggregating online reviews from sites like Citysearch and displaying them on a business’ Google Maps page. But Yelp dominates this market, thanks in part to its prominent display of a five-star rating and price range, and because it shows an actual user’s review.

That has also been the ire of local businesses, because that top review — whether good or bad — is often the first impression received by many potential customers on the ‘net. Yelp sales reps often focus their pitch on that fact — and that advertising on would allow the business owner to move a positive review of their liking to the top of their page (and hence show up on Google results).

Gawker wonders, meanwhile, whether Google will make any attempts to clean up Yelp’s sales practices, which sometimes resembled extortion (and which we documented earlier this year.

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