Note: "sucks" is a pretty strong and immature word, but it's the word to use online when you think someone has a bad idea. So, if that's off-putting, get over it. Or start a "sucks sucks" site.
Recently I was asked what I thought of Angie's List. Frankly, I had no idea. I was told it was a pretty neat list that has good ratings of local retailers. The idea is that you are looking for advice on a company to hire for a service (e.g. car repair) so you check Angie's List and see the advice and ideas of other users who have used the site. It's basically like Better Business Bureau, City Search, or one of thousands of other local directories. Many of these directories are broken: biased reviews, paid inclusion, incomplete information, etc. This is where Angie's List claims to be different. They use "only" consumer generated content and require a "small fee" to keep the reviews unbiased.
Here's a bit on the policy:
Consumer support means it's honest: Companies don't pay to be on Angie's List. Only Angie's List members report on the companies they've hired. View the list of services rated in your area. Additionally, members make sure the ratings are clean and honest by supporting Angie's List. They pay a MEMBERSHIP FEE because we work for them (not the contractors) to keep the list growing with the most accurate information about the companies in their area.
Why This Angies List Policy is Dumb
Let's say that I'm a consumer. If Angie's list charges me $5/month I have to get a lot of value out of the list for it to be worth that membership fee. They have millions of customers though, so apparently it's compelling to some folks. Let's say that I'm the business owner, though. If I can create a fake email account and use my home address (or my neighbors address) so that Angie's List doesn't know who I am, then $5/month is a pittance for being able to enter a review of my own business.
So, their whole "we charge a small fee to keep the reviews honest" thing doesn't work for the stated policy, but it sure does help them bring in revenue without worrying about advertising.
Paid Position/Advertising on Angie's List?
Here's the worst part - after your company gets added they contact you and say something like "your company has been added and reviewed. If you'd like you have an enhanced listing you can pay us for that."
So the whole "we are acting in our members best interests" thing is bullshit! They have one interest in mind: their own.
The Review Problem is Real
The thing is - it's really hard to run a review site. Really hard. Getting valuable metrics is difficult. How does each user know if they should be trusting the other users of the site. Angie's List's paid membership program clearly doesn't make sense (though it may work than other current options). So, what's the future? Fortunately, it's the online corollary to the system you already use in real life: you ask your friends and colleagues via social bookmarking that helps guide you to the best local plumber. This is the clear way to solve the problem in the future.
Sorry, Angie's List. You could implement these features in your site, but don't pretend that the $5 is for anything other than your own pockets.
Edit: For an update and details as far as why you have to login to write comments see www.angieslist.com update post