A flurry of business lead services have cropped up, each a variation on the model that has been successfully developed by ServiceMagic and others. They basically provide a directory, information, leads and marketing services.

One of the new crop of lead services is HelpHive in Seattle, which recently launched and was profiled here. It provides a basic directory. It also provides several tiers of SMB services (including customizable home pages, leads, SEO, multiple ways of contacting businesses, and free video).

HelpHive, however, has inadvertently brewed some controversy by putting in a dedicated phone number for EVERY business listed — not just those that opt in to its system.  Evan Conklin, who owns a plumbing and heating service, is absolutely furious at the practice, and has been venting at the company via calls for class action suits, letters to government officials and bloggers like me.

Conklin raises some important points about the practice of building an alternative directory with proxy phone numbers that might be used as a substitute for “neutral” Yellow Pages. Here is the gist of them.

1. HelpHive uses an SMB’s trademark without permission.
2. The customer may think that HelpHive’s dedicated telephone number is real. “When nobody picks up the phone and they are told we are unavailable they think that we are not paying attention to our phones.”
3. “They call you on your real phone number and try to sell you an upgrade to improve your position in their listings or whatever.”

“I have yet to find one business owner or individual that did not react negatively to the idea of some unrelated third party posing their name or business with a false telephone number on the Internet or any other public space,” says Conklin.

I shared Conklin’s comments with HelpHive’s Karim Meghji, who is getting very familiar with Conklin via phone conversations, Web postings and other communications. It is Meghji’s strong belief that HelpHive hasn’t crossed the line in any way at all. He also says that HelpHive is completely transparent, and emphasizes that SMBs have full opt-out rights.

“Yes, we do have a HelpHive phone number on each business listing,” says Meghji. “We do this so we can provide a low-risk, low-cost, performance-based model to businesses interested in generating referrals and business from HelpHive. Our business approach is ‘we get paid when the business is getting paid.’ In order to do this, we employ a proxy phone number to track and report to business referrals that originated from HelpHive and HelpHive customers. This is not like other approaches where evaluating the return on investment can be challenging at best.”

Meghji also confirms that HelpHive did call Conklin. But it was not a sales call.  In fact, it was “only as a followup to questions that Evan Conklin POSTED via our customer services system about how the contact information on HelpHive works. It was not, nor was it intended to be, a sales call.”

As for misrepresenting whether a business is available to answer phones, Meghji says when a customer calls a business via HelpHive, “the first thing they hear is a welcome from HelpHive and then a request to enter the HelpHive extension of the business they are trying to reach.”

My view: It is kind of harsh to pick on HelpHive specifically — there is no reason to doubt that it sincerely wants to help SMBs while building its own business. In fact, it has a lot of good and helpful ideas that provide a lot of value to SMBs. But we are living in an era where new directories are aggressively soliciting SMB business, and sometime misrepresenting themselves in order to better engage with the SMB (and sell them). In the interest of consumers and businesses, there probably need to be strong disclaimers about directory information when proxy numbers are used without specific opt-in. Doing so wouldn’t necessarily hurt the new directory.