News surrounding Facebook’s (NASDAQ:FB) Graph Search has had Yelp (NYSE:YELP) sweating off share value this week, and now an update from Bing puts Yelp in even greater danger of becoming irrelevant, while also casting a shadow on Facebook’s news.
Facebook and Yelp
When word came out about Facebook implementing a search function that operated similarly to Yelp’s social-based search, the implications for Yelp became quite serious. Facebook’s Graph Search is intended to allow Facebook users to find information on various subjects, as it relates to their Facebook friends. An example: if Jimmy is interested in a restaurant but has never eaten there before and wonders whether it’s any good, he could use the search tool to see if any of his Facebook friends has gone there and mentioned it on Facebook.
The problem for Yelp is that the information Facebook users can look up has significant overlaps with that information current Yelp users might be looking up, and Facebook has the added benefit of a global, overwhelmingly massive user-base, which could immediately begin sourcing the information for searches, making its service more effective and its recommendations more personalized. Fortunately for Yelp, Mark Zuckerberg has said Graph Search will take years to polish, so Yelp should have time to adjust its platform to meet demand…