The spat between Yelp and Google that Greg Sterling reported on today (Aug 26, 2010) gives us a tiny glimpse of the tip of what could be a hideously ugly iceburg.

It’s become obvious lately that in the realm of Local Search, Google wants to keep searchers on it’s own pages as much as it can.An example of this mindset is the way it gathers and publishes snippets of reviews from other websites on the Places pages of Google Maps. Yelp does not believe this is in the best interest of its own directory and also feels it is a disservice to searchers who are not shown complete reviews, but only the parts Google chooses to show. True, searchers can click through to the full review, but how many do? Someone else will have to delve into the psychology of that behavior, but my personal guess is not many.

Google is more interested in sending search traffic to it’s listings of local business information than in sending them to the business’ own website or to information published anywhere else on the web about them. The idea is to consolidate as much information as possible about a local business in one place. It sounds like a lofty goal and Google justifies it by trying to make us believe that is what is best for searchers. But is it, really? Probably not.

Google decides which information from which websites to show – or to not show. We certainly can’t believe that the deals it makes regarding the gathering and publishing of that information are unbiased or based on lilly white motives. Neither is its Local Search algorithm unbiased, as information from some sources very likely has more clout in the formula than that from other sources.

Yet, most websites go along with it for the few crumbs they are thrown. Some directories are currently working it to their advantage, even while realizing that their favored status could disappear quickly and completely pretty much at Google’s whim. In some ways, it’s a classic abusive relationship, where the abused feels the only way to survive is by gratefully accepting the punishment.

It takes a portal with clout of Yelp to stand up to Google. It’ll be very interesting to watch how it unfolds and if others will gain the courage and follow Yelp’s lead.