It seems to me that with this launch, Google has become more like Microsoft when Google was gaining some sort of ascendancy - a juggernaut that is so afraid of the upstarts that they chase the shadows of the next big thing, in this case Groupon.

The local search & commerce space cannot possibly only look like Groupon. On Hacker News, we have seen people try different models & different variations. There are some ways that doesn't even rely on deals. Just yesterday we saw http://getpunchd.com/ a mobile play on loyalty schemes.

And Google has Android, a mobile OS coupled with what was once and possibly still the best mapping site on the web. It would seem figuring out how those two combined can be the wedge into the local space should be their priority instead of being scared into creating a clone.