MySpace may have lost the buzz wars to Facebook, but the site still has more users than its rival (70 million to 57 million in the U.S.).
But this deal is clearly aimed at Yelp. Like Yelp, MySpace Local will sell ads to local businesses (as well as national advertisers) and will include basic business info, user review and ratings functions, and the ability to bookmark or share the listing, or add it to the users' profile. One big difference is that MySpace Local will default to ratings and reviews from the users MySpace friends. (See a sample screen shot at bottom of this post.)
Still, it's likely that MySpace Local will raise Yelp-like concerns among businesses. Yelp has been dogged by controversy over its ratings policies and charges that companies who buy ads can "bury" bad reviews and promote good ones. Some businesses, meanwhile, say they feel bullied or blackmailed into buying ads, and are still trying to come to terms with how to work with these sites. The word extortion is often used.
That may not be enough, and Yelp is no longer the only source of these reviews, as MySpace isn't the only online powerhouse jumping into local ratings and reviews. Restaurant reservations site OpenTable is also about to let users review their dining experiences. And as bMighty noted last week, Yahoo has launched Y! Local to replace the Yahoo! Directory, which also offers a star rating system, profiles, and reviews. (Ironically, Yahoo! recently wrote about Yelp's issues...)
All these new competitors may lessen the harm caused by a single bad review, or reduce the bounce from a single good one. But they also add to the time and complexity involved in monitoring what consumers are saying about your business.
MySpace Local is currently in private beta, with a public beta due next month. Initial categories include restaurants, bars, and nightlife, with personal and professional services (doctors and dry cleaners), hotels, travel, and attractions to follow.