It looked like the perfect David and Goliath story: A tech giant , hurting mom and pop restaurants by grabbing up digital real estate and using it to boost its own commissions. There was just one problem: That’s not what actually happened.
Yelp, another technology platform key to many small restaurants’ business, faced similar criticism after allegations emerged last year that itThese issues have become endemic across the digital economy, according to Stacy Mitchell, co-director of the Institute for Local Self-Reliance. She said that the power imbalance between large tech platforms and the small businesses that use them means contracts are rarely set on equal terms.
Sharokina Shams of the California Restaurant Assn. said even if permission to create the microsites was given in Grubhub’s terms of service, the lack of communication and clarity on activity the company was undertaking on restaurants’ behalf is a problem. “Now, to add insult to injury, we learn of these alleged ‘ghost’ websites and of charges to restaurants for orders that were never even placed. That’s unacceptable, and it’s something we’ll certainly be looking into further,” Shams said.
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