But in a second step, Yelp has taken a much more social. Users began to write more and more, using the site almost like a blog. In 2005, we re-launched the site with an emphasis on sharing and comments on local communities. At the end of the year, a true community of users had developed in San Francisco. We raised more money and deployed this model.

Then, a social network … Not at Facebook, which is similar to the e-mail, but certainly like blogging, for all those who love to write and interact on food, restaurants …”

Yelp , the site re launched in 2005 in San Francisco now arrived in France . At first glance, the site wants to bet on the restaurants. According to Jeremy Stoppleman , co-founder and CEO. In France, the culinary and gastronomic culture is very strong. So we said, here especially, Yelp had a very good chance to meet its public.

Note that the homepage of the new site Yelp French is currently at around 3500 rating of users on the topic “shopping” and “restaurants”. Moreover , it appears that the entire network (America, United Kingdom, Ireland …), the site recorded in the 31 million visitors in March.

Yelp have no clear roadmap for Europe. After seeing the results on how the site grows in France, then the company decision taker will decide on the strategy of moving further.

Yelp, which started in 2004 with $1 million investment from Max Levchin, at present claims to attract over 26 million viewers contributing close to 8 million reviews each year. With a sales force of 200 people and $45 million revenue for last fiscal year, Yelp is expected to go profitable in 2010. Yelp offers Google a huge repository of local data covering not just local bars and restaurants, but even dentists and near-by churches.

While Google is expected to face competition from Microsoft and Yahoo for the bid, such acquisition is also expected to rankle Google’s ties with AT&T and other companies which have been selling search ads to local businesses signing up for the Yellow pages.

Critiques however are rating Google’s $500 million valuation of Yelp as a miscalculation of the company’s worth. Questions are also being raised on objectivity of search results with Google itself owning such a service. Also, due to Yelp’s negative image, skeptics are now raising eyebrows towards Google’s ethical standards as well.

There is no official announcement from either Google or Yelp about the deal but various sources have confirmed information about the ongoing negotiation to New York Times. Market analysts view the deal as Google’s intention to get a tight hold over the local business market which they have been trying in recent past.

Google generally takes over a company for their technology and work force but with Yelp Google has much more to add to its giant empire.

• Yelp once added to Google could step up little slowed down Google’s core search advertising business.
• In the growing trend, local shops are preferring web sites of newspapers and directory sites as Yelp and CitySearch over the Yellow Pages and other print media. Yelp’s intelligent information that includes extensive knowledge of people’s tastes and price preferences would help Google produce local advertising.
• Acquisition could probably bring increase in Google Mobile services as Google has a clear interest in combining Google Maps, search results, and its small-business-oriented advertising technology into its next big source of revenue growth. With Yelp’s data, the app could suggest restaurants and other services along the way.
• Yelp’s technology will support Google’s ‘Place Pages’ which according to Google are a web page for every place in the world which includes feature reviews, photos, and, ads .

Yelpers have made yelp grow to an approximately 26 million views per day, Google’s idea would give them chance for better advertisements providing ads at every stage from local searches page to Place Pages for businesses and even to Google Maps while people tend to find directions to those businesses.

There are no details when the deal would be finalized but the news of the ongoing negotiation was first broke out by TechCrunch and later on confirmed by New York Times citing anonymous sources.

Yelp was founded in 2004 with an aim to connect people with great local businesses, provides users to view and post in reviews and find events, special offers, lists and to talk with other Yelp users.

Yelp creates its revenue by selling ads to local businesses. Yet no clear motives are mentioned but Google generally buys a because of the technology and workforce it supports. Google might intend to broader its reach among local businesses with this deal.

As reported via The New York Times
“The people with knowledge of the deal would not disclose the acquisition price, but one said that it was more than $500 million, the figure cited by TechCrunch, the industry blog that first reported the news Thursday evening.”

The acquisition once done would mean Google getting access to local listings and reviews, which they may then connects to Google Maps and bar code scanning and lines up local keyword ads. This would be a sure step in process of strengthening its local business market.