Agreed, but this one seems to be the perfect fit with google places and checkout. It's not great to see a Goliath taking on smaller competitors, but the truth is that Groupon hasn't innovated much since it launched.
Remember that Google first attempted to acquire the "smaller competitor" and its offer was declined. Should Google just restrict itself not to compete in any space where there is a "smaller competitor"?
As long as the customer benefits (i.e., the behemoth actually innovates and doesn't kneecap the opposition), then the competitive marketplace is doing it's job.