As previously reported, last week, Prost Productions announced a new documentary project called Billion Dollar Bully, which dives into the infamous Yelp "extortion" allegations that have persisted for at least six years.
The basic story that we've seen brought up in numerous press reports and internet comments over the years is that Yelp salespeople call businesses who are listed on Yelp and try to get them to advertise. The business declines to advertise, and Yelp responds by burying positive reviews and letting negative ones rise to the top. There are variations on the story, but that's general gist.
Billion Dollar Bully is already half shot, but Prost Productions is raising funds on Kickstarter to get it finished. This was announced last week, and Yelp now finds itself in the media spotlight once again, defending itself against familiar claims. It will probably be doing so again in the future as the film has already met nearly two-third of its funding goal with 26 days to go. So far it has raised nearly $40,000 from 340 backers. The campaign even earned "staff pick" status on Kickstarter.
After news of the project came out, Yelp tried to discredit filmmaker Kaylie Milliken. The company said in a statement:
The director has a conflict of interest, as she has a history of trying to mislead consumers on Yelp. There is no merit to the claims they appear to highlight, which have been repeatedly dismissed by courts of law, investigated by government regulators, including the FTC, and disproven by academic study.
We asked Yelp to elaborate on these claims of Milliken's "conflict of interest" and her "history of trying to mislead consumers on Yelp," but the company would offer no further comment. They did, however, point us to links to its corporate blog posts about the court dismissals, FTC investigation, and academic study (which is from Harvard Business School Professor Michael Luca and Professor Giorgos Zervas of Boston University).
We interviewed Milliken, and asker her what Yelp was referring to regarding her conflict of interest and whatnot, to which she responded, "I honestly have no idea what they are referring to, but I welcome any information they have.”
We also asked her about the FTC investigation and study Yelp pointed to. She said the documentary would go more into the investigation.
Regarding the study, she told us, "If you look at the Harvard Business Study, the very first line asks the question, ‘Do online consumer reviews affect restaurant demand?’ This is the focus of the study – whether or not reviews actually hurt the restaurants. Yelp points at it as though the study was done to show review manipulation does not happen. Next, if you look at the arguments the author of the study makes, his first point is this: each star rating attributes 5-9% increase in revenue. (Therefore, if negative reviews do drag down the star rating, the business is negatively affected.) Next point: it is only independent restaurants (not chain) that are harmed in this.”
After our exchange with Milliken, both she and Yelp's VP of Corporate Communications, Shannon Eis, appeared on CNBC to trade remarks.
"We're not here out of fear," said Eis. "We're here out of facts and making sure they transcend this conversation. Dismissing the FTC, dismissing five federal judges who all found no wrongdoing, dismissing an exhaustive Harvard Business School study and it's actually not the one that she's citing. There's a different one that looks specifically at our recommendation software and draws no connections to advertising. So she's citing an older, not Yelp-specific study. Though dismissing all of that seems a little weird when all of it has very exhaustively debunked the claims. But why we're here is because it's important that the facts speak, and that the value to consumers that we want to create and continue to drive really transcends all of this."
Milliken says she's not dismissing what the FTC said, and reiterated that the documentary will go into it extensively, and that she'll "let the experts speak for themselves."
And for the record, Yelp itself has dismissed something the FTC has found in the past. Here's a statement from the company about Google's antitrust settlement with the commission two years ago, as reported by CNET:
Yelp, who has been among the company's most vocal critics, called it "a missed opportunity to protect innovation in the Internet economy, and the consumers and businesses that rely upon it."
In the CNBC exchange we finally got some elaboration on Yelp's part about what it deems a conflict of interest.
Eis says, "We're here today because she's raising money on Kickstarter to fund her film, so we're all part of a fundraising effort today, but I think what's important to state is that we did discover through the recommended software that is largely being contested here, that Ms. Milliken herself created three sockpuppet accounts to create false five-star ratings of her huband's law firm - her husband who is also listed as the CFO for this production that we're fundraising for as a result of this media, so I think it's important to say that the accusation that she's making, she's actually been a part of on the back end, and the software process that we're talking about that helps protect consumers and present true and authentic reviews was something that triggered finding her false reviews on the site and suppressed them."
Milliken responded to that by saying, "I did create several different profiles, and I wanted to investigate and see what happened to the various reviews that I left. Not just on my husband's site...on many websites to see what happened to those reviews, and I think it's shocking and very telling that this billion dollar corporation has come after this grassroots, very small production company, where there are only two of us - myself and my associate producer Melissa Wood - creating a documentary that we are still in production over, and we released a two-minute video online, and Yelp has fired back with all of that. This billion dollar company versus this grassroots organization. I think it does clearly show that they are concerned about what will be coming out in the documentary."
To which Eis responded: "I think that's an unfair statement. This has been going on for weeks. We released one two-sentence statement, and we let it go. But it gets to the point where the same misleading activity is now trying to fundraise to further this conversation, we have to step in and really make sure facts and gravity are at the center of this, which is what's the right thing to do for users."
I'm not so sure that "furthering the conversation" is such a bad thing regardless of who's right here. The thing is that despite anything Yelp has pointed to in its own defense, accusations have persisted. Whenever these studies and investigations supposedly "debunk" claims, they don't seem to do so without questions remaining. If the documentary can truly "further" the conversation (as opposed to rehash it), isn't it worth watching? The same would go for Yelp's side of the story. When Yelp has some new study or investigation to point to, we pay attention. When the FTC closes an investigation, we report on it. Shouldn't small businesses be able to have their voices heard as well? As long as the conversation is indeed being furthered, I don't see how it can be a bad thing.
That is the supposed point of the documentary, and maybe it shouldn't be dismissed until its materials are presented. It might be different if the whole thing wasn't such a common story. Look around at articles about Yelp all over the web, and you'll likely see numerous comments talking about the types of things the documentary is looking at. We've gotten about 30 comments on our coverage over the past few days, and they're almost all against Yelp. That doesn't mean they're all credible, but the fact remains, the conversation isn't going away. People care.
I think a lot of people are just interested to see if Milliken's film will produce any hard hitting evidence we haven't seen. Milliken told us in our interview that it will include some "material that very few have seen".
Asked if Yelp is going to sue Milliken, Eis said she can't speak to legal proceedings but that it's "absolutely not on the table right now."
We've reached out to both Yelp and Milliken for additional information in light of what was discussed on CNBC. There are two different Harvard Business School studies regarding Yelp, but both deal with restaurants:
The one Milliken quoted from in our interview is the former. We've inquired about that, and we've sought to learn more from both parties about how Milliken used the fake Yelp accounts. We also inquired about her husband's role in the production of the film. We'll update accordingly.
Update: Regarding Eis' comments about the Harvard study, Milliken tells us, "I have no idea what she is talking about. She also said that they aren't Yelp specific, which they are. This really will be investigated in the documentary."
Here is her response regarding the Yelp accounts she created:
"Before my husband and I were married, he represented me in a legal matter. He did an incredible job, and I left him a legitimate review. That was filtered out. At the time, I did not understand how the filtered system worked, so when I went on his site and saw my review wasn't there, I thought my account didn't work. I made another account to leave him another review, which again was filtered out."
"I definitely see the need for a filtering system. You don't want people going on and creating 'sock puppet' accounts."
"Once I became interested in doing this documentary, I wanted to see how the filtered system worked. I started leaving comments at various businesses. To my knowledge, all of my reviews (which were at legitimate businesses that I had attended) were placed in the filtered reviews. I think one was left."
Asked if her husband's business has been penalized on Yelp (the company often issues "Consumer Alerts" for businesses it says engage in "shady" practices), Milliken said, "No. He does have reviews from legitimate clients filtered out, but I wouldn't necessarily call that 'penalized'."
On Yelp's comments about her "conflict of interest," she tells us, "I think it just goes to show that Yelp truly is concerned about what will be exposed in Billion Dollar Bully. We are a small production company - it's Mellissa [Wood - associate producer] and myself, working together on this project. We had an idea of a compelling story that we passionately believe should be told, and all of a sudden Yelp was coming after us. I think that speaks volumes above anything I could say at this point."
Milliken has said that the film comes from just her and Wood . On Eis' comments about her husband being the CFO for the production, she says, "My husband is a contract CFO for the production company. Mellissa Wood and I are working on this project together (There are other contract employees; ie, videographer, editor.)."
As previously reported, Milliken has cited a conversation with her physician as being the inspiration for the documentary. Asked if the physician will be speaking in the film, Milliken says, "No, she is one of many who are concerned with retaliation."
Update 2: International Business Times shares screenshots of Yelp's backend that the company provided, which shows what is apparently MIlliken's "questionable" activity, though she has already addressed this in the comments above.
From the Prost Productions Facebook account, she also commented on that article, saying, "I want to address this article that was just released. Yelp is trying to create an environment where Billion Dollar Bully is about myself. It is not. It sticks to evidence, facts, and personal experiences of business owners throughout the United States. Like I've said before, I think Yelp's continued reaction to Billion Dollar Bully speaks volumes and is much more illuminating than anything I could ever say."
At the time of writing, the project has raised over $48K of its $60K goal with 24 days to go. It has nearly 400 backers so far.