Yelp’s grudge against Google
JEREMY Stoppelman, CEO of Yelp, the local search and reviewing site, would like this article to be focused on his company’s growth, or on how its reviews help independent businesses, or on pretty much anything besides what it is about: how Yelp became Google’s most tenacious pest.
“If you were to have asked me 15 years ago, ‘Hey, are you going to be an antitrust crusader?’ I would have said, ‘No, I have no interest in that’,” he said. “That was not a childhood dream.”
For six years, his company has been locked in a campaign on three continents to get antitrust regulators to punish Google, Yelp’s larger, richer and more politically connected competitor. He has testified before Congress, written op-ed columns and used Twitter to bash Google’s behaviour.
Unlike Google, whose office is full of artwork and free food, Yelp’s Washington presence is just a rented co-working space. “This is a shoestring operation,” said Luther Lowe, Yelp’s vice president for government relations.
But after years of trying and failing, that operation has finally landed a good punch. Last Tuesday, the European Union fined Google $2.7 billion – the largest antitrust fine in its history – for unfairly favouring its own services over those of its rivals. The fine was related to Google’s shopping service, so strictly speaking it had nothing to do with the Yelp-Google dispute, which is part of a separate investigation into local search.
Still, Yelp and other American technology companies pushed hard to get regulators to issue a bold condemnation of Google’s behaviour towards competitors, signing a letter that accused Google of “destroying jobs and stifling innovation”. And by affirming that Google is the dominant company in online search, Tuesday’s decision is likely to help Yelp’s case.
Yelp is one of a number of American companies that have agitated for governments to take up the fight against Google. It is one tiny player, but through persistence and doggedness it has become an unusually prominent voice.
For Yelp, the issue is where Google displays “organic” website rankings – the ones spit out by its algorithm – in relation to the “vertical” results that Google provides.
Yelp’s contention is that by putting its own results at the top, Google is giving itself an unfair advantage, because those results don’t have to jump through the same algorithmic hoops non-Google sites are subjected to. And since Yelp says few people go beyond the first or second result, companies like Yelp are made invisible.
Google disagrees. The company declined to comment beyond its official statement on the European fine, but it has repeatedly said that as smartphones displace desktop computers as the internet gateway, people just want the answer to their question – not a link to a site where they might have to repeat the query – and that Google’s results oblige.
This dispute would be moot if people were in the habit of using a variety of search engines.
Google is sitting on close to $100 bil- lion in cash, so the $2.7 billion fine is hardly unmanageable.
A larger concern is that the decision, and the potential for other antitrust actions, will limit Google’s ability to position ads around its search box. And Google is still the foundation of a big advertising company.
The impact is hard to discern, because it’s impossible to judge whether Google has done wrong without delving into detail about software algorithms and concepts like “consumer harm”. Explaining all that has been Yelp’s principal challenge with regulators. The war over how Google serves up information has been an information war.