Yelp Surrenders Payola War, Loses Easiest Shot at ProfitS

Yelp has surrendered. CEO Jeremy Stoppelman announced his local-reviews site will stop selling merchants the ability to select "favorite reviews," which push negative feedback further down profile pages. So now how will Yelp make money?

Apparently with "slideshows," a new advertisers-only addition to Yelp profiles that replace "favorite reviews," according to a blog post from Stoppelman. Somehow we don't think that will be as powerful a lure to merchants, whom Yelp is depending on to help it escape four years of unprofitability after Yelp reportedly blew a chance to sell to Google. But the move, along with the new ability to see reviews "deleted" by Yelp, will help the startup fend off a wave of potentially lethal extortion lawsuits from aggrieved—err, "confused," in official Yelp parlance—small business owners.

[Top pic: Yelp dancer at Yelp party via Yelp photostream]