Is Yelp the Thug of the Internet?

Yelp is allegedly doing something crappy, and if true, this practice puts into question the quality of the results we often rely on to make our dining and shopping choices.

Today, we’re going to talk about Yelp, a potentially unethical, publicly traded company that may be doing something that you can help stop.

You might be thinking, “I love Yelp!”

I do too! Yelp provides an awesome service which makes a people happy. But … Yelp is also allegedly doing something crappy, and if true, this practice puts into question the quality of the results we often rely on to make our dining and shopping choices.

Back in the ‘30s, my grandfather had a men’s clothing store on Empire Boulevard and Nostrand Avenue in Brooklyn. A frequent occurrence in that neighborhood involved a bunch of guys resembling something out of The Sopranos. These guys would pay your store a visit, look around, and comment about all the nice things you have. Then they would say in a vague, but clearly menacing manner, “It’d be a real shame if something were to happen here.” They would then offer to “protect” your store for a fee.

Over 600 complaints filed with the FTC allege that Yelp is acting like those guys in Brooklyn. The claims suggest that Yelp is intentionally filtering positive reviews for a business listed on their site, and soon after, Yelp’s sales staff calls that business to indicate those positive reviews could be restored … If that business were to purchase some advertising.

Yelp, when questioned about this by MSNBC, said their system is totally automated, and it can’t be manipulated to coerce business owners. In fact, Yelp has set up a page to debunk what they suggest are myths, one of which being that the sales team has access to manipulate reviews.

But Tyler Spalding, a former NASA engineer, MIT graduate, and co-founder and CEO of knows a thing or two about the kind of systems Yelp uses. StyleSeek uses something similar to provide their customers with personalized recommendations for lifestyle products. “Amidst the controversy, Yelp continues to make statements like ‘The algorithm creators don’t even talk to the marketing folks’ and ‘the algorithm is an automated system.’ Assuming those comments are true, it’s actually fairly trivial to build a system that is automated, but accepts a variety of manual overrides to create desired results. The question is, can Yelp have an objective algorithm that runs independently of humans, but have an interface for marketing folks to adjust reviews as they want?  Absolutely.”

Eyal Amir, CEO of Faspark, the street-parking app, and Adjunct Professor at University of Illinois, concurred, “It is very simple for Yelp to fix their algorithm, just like you can fix a scale.”

Although Yelp claims the sales team doesn’t have that sort of power, that doesn’t rule out that other members of the Yelp team could enact these alleged shenanigans. And since Yelp is perennially unprofitable, as a publicly traded company, they face an intense amount of pressure to turn a profit. It’s not unreasonable to think that the pressure from shareholders could lead Yelp to do some things that are less than ethical.

Now, there is no smoking gun yet, but as you’ll see in the MSNBC story, one party who had their positive reviews filtered went to the local press, and their positive reviews were suddenly restored. So, I’d like to make a request. The only way to call them out is for all of us to take action. If you are a business listed on Yelp, your positive reviews suddenly vanish, and you get that alleged phone call promising to restore your reviews if you buy advertising? Document that. Record the phone call if you can. And if you do either, take that information right to the press. As Justice Louis Brandeis once said, “Sunlight is said to be the best disinfectant.”

Image by greenman57.