Main | Friday, July 09, 2010

Air Google

Google will buy travel software company ITA for $700M. While they claim to have no plan to establish themselves as resellers of airline tickets, the takeover is raising concerns of anti-trust violations.
"What we're going to do is build new flight search tools that focus on end-users," Google Chief Executive Officer Eric Schmidt said in a conference call with analysts and members of the press on Thursday. He said that Google had no plans to sell airline tickets to consumers and that Google planned to honor all existing agreements that ITA has with its partners. The deal should allow Google to match innovations made by Microsoft Corp, whose recently re-launched Bing search engine has gained share by focusing on a handful of specific search categories like travel and shopping.

The deal, which was reported to be in the works for weeks, has unnerved travel industry players worried that Google could end up wielding too much influence in the sector. ITA, which has roughly 500 employees, provides software that organizes flight information like fares and flight times. The company is a major source of information about airfares to the aviation industry, used by airlines, travel agents and other sites including AMR Corp's American Airlines, Continental Airlines , Hotwire, Kayak, Orbitz and Microsoft's Bing.
Travel-related searches currently make up about 12% of Google's revenue.

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