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Money is burning a hole in Google’s pocket. Back in November Google purchased AdMob for $750 million. Now Google is expressing a serious interest in Yelp, and a figure of $500 million is being bandied about as the possible price of acquisition.
Yelp is a social networking company that concentrates on user reviews of local businesses, promising “Real People. Real Reviews.” Yelp has a presence in 40 states, and has user reviews on nearly 31,000 local businesses. Yelp has recently gone international, with London as its first foreign location.
Google has a serious interest in establishing itself in this same general venue. It is currently building directories of local businesses for its Place Pages, and creating links to Google Maps. But, Yelp offers much more: not just the reviews of local businesses, but a social network of people active in the acquisition and sharing of such information. (Never pay for something you can get others to do for free, right?)
By acquiring Yelp, Google would also enhance a revenue stream: more business advertising. Yelp sells sponsorships to businesses, ranging from $300 to $1,000 a month, for ads and favorable search result placement. Businesses can also promote themselves on their own profile page--something Google is presently offering.
The deal’s not done. And, it is suggested that despite the seriousness of negotiations, now that word has leaked about the possible deal, another suitor might jump in and snatch Yelp away.
Image Credit: Google, Yelp