Why Tripadvisor Has Gotten the Attention of the FTC

Tripadvisor Inc (NASDAQ:TRIP) has come under fire recently for allegedly suppressing negative reviews on its website. It was discovered earlier this month that in instances where users reported sexual assaults at resorts in an attempt to warn other travelers the reviews were ultimately removed.

The complaints have garnered the attention of the Federal Trade Commission (FTC) and may prompt an investigation into Tripadvisor’s business practices.

The FTC stated that “The Commission has a strong interest in protecting consumer confidence in the online marketplace, including the robust online market for hotel and travel.”

The inherent problem with a travel and review site like Tripadvisor is that on the one hand it wants travelers to feel free to post their honest opinions and that their input will be valued. On the other hand, too many negative reviews are bad for businesses and the site is ultimately responsible for what is posted on their website, and potentially defaming comments are something the company would certainly want to avoid.

There is unfortunately nothing to stop a competitor or a person with a vendetta for whatever reason to post a scathing review of a resort and lying about their experience. There’s also no easy way to solve that problem either. A user isn’t going to upload a copy of a police report when alleging they were sexually assaulted, and if users had to validate their complaints when leaving negative reviews then it could discourage many from leaving any commentary at all.

On the other side of the equation you could have hotel employees posting five-star reviews about themselves in order to boost their company’s popularity. For websites like Tripadvisor, it’s a constant balancing act to find a middle ground.

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