Yelp, Google Breakup Bad News for Small Business

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It is unhappy news that Google won't be purchasing Yelp. It was a natural in terms of things Google should be doing, especially in helping small local businesses promote themselves.

The $550 million deal, which lived and died over the weekend, would have also made Google more of a one-stop for local businesses, who often don't know where to invest their small promotion budgets. It also might have moved the reviews social network away from advertising sales that have challenged its credibility.

If Yelp has gotten a better offer and bailed on Google because of it, it's bad news. Only Google brings the breadth of offerings necessary to be a good single purchase for small business. Nothing else is even close.

I hope Microsoft realizes this before trying to make Yelp part of Bing, although the names do sound like they belong together, if not the services.

As much as we don't like near monopolies, they have their good sides. Local businesses realize they need the Internet, but don't have the time or dollars to invest. Google offers many free and low-cost ways for local businesses to promote themselves online. Yelp does the same thing, though not as well.

Teaming the two would have allowed local businesses to do excellent local marketing, presumably at low cost, by dealing with only one trusted vendor, Google

Having said that, it is not clear Google would have known what to do with Yelp.

Ideally, there would be technical and back office integration, which fits with Google's engineering-driven culture. More concerning, however, is whether Google could just sit and watch Yelp's content and community management.

So far, in two attempts, Orkut and Knol, Google has failed to develop communities. YouTube has a community, of sorts, but is hardly a comparison to the level of community (or average IQ) necessary to make Yelp function.

Maybe it's just as well for Yelp and Google go their separate ways, but as someone who cares about local businesses, I feel like an opportunity has been lost.

David Coursey has been writing about technology products and companies for more than 25 years. He tweets as @techinciter and may be contacted via his Web site.

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