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Google Pumping Up Its Local Listing, Acquires Zagat
Google Pumping Up Its Local Listing, Acquires Zagat
By: Bikram K Singh

Anyone who said Google is not going drastically local then he should be shut. Google has made a strong statement by acquiring 32-years old Zagat, a restaurant review company, which predates even personal computer era.

Zagat is a well known name in the review industry and famous for its slender restaurant guidebooks. The Zagat guidebooks contain restaurant ratings and reviews submitted by 350,000 surveyors. In the recent years, the company has reinvented itself to stand shoulder-to-shoulder with Yelp and Foursquare. Yet, Zagat couldn’t be as big as the other two simply because it had not offered much of its content for free, prior to February 2011, when the company adjusted its course. Now, the restaurant review company also offers applications for major mobile platforms.

The terms of the sale is still undisclosed, but if we look at the asking price of Zagat in 2008 and Google’ offer to Yelp in late 2009, we may get some rough idea about the numbers. In 2008, Zagat put itself up for sale for a sum of $200 million, but later it pulled the listing down. And in 2009, Google was negotiating with yelp on a price point of $500 million, but Yelp felt it was more valuable and walked out of the deal.

Google, for many years, has used Yelp’s data to make its Google Places listing meatier, but since the deal got sour, the relationship between yelp and the search giant has started eroding. To its customers’ dismay, in recent months, Google started overlooking Yelp data.

Will things change now? Will Zagat fill the vacuum created by the “soured relationship” between Yelp and Google?

In a blog post released on the official Google blog, Google has expressed the desire to use Zagat as an information provider for its Google Places listing. In the blog post, Marissa Mayer, VP, Local, Maps and Location Services, wrote, “With Zagat, we gain a world-class team that has more experience in consumer based-surveys, recommendations and reviews than anyone else in the industry. Founded by Tim and Nina Zagat more than 32 years ago, Zagat has established a trusted and well-loved brand the world over, operating in 13 categories and more than 100 cities. The Zagats have demonstrated their ability to innovate and to do so with tremendous insight. Their surveys may be one of the earliest forms of UGC (user-generated content)—gathering restaurant recommendations from friends, computing and distributing ratings before the Internet as we know it today even existed.”

Towards the end of the post, she mentioned, “I'm incredibly excited to collaborate with Zagat to bring the power of Google search and Google Maps to their products and users, and to bring their innovation, trusted reputation and wealth of experience to our users.”

The question still remains, will Zagat be able to provide the muscles that Yelp had provided to Google Places pages? Or will it prove to be the same mistake it committed in 2005 by acquiring Dodgeball? Google will only hope that Zagats do not leave the board and create a more fierce review engine, as did Dodgeball’s founder Dennis Crowley when Google decided to close the doors of Dodgeball. The new company Mr. Crowley started goes by the name of Foursquare.