Google announced this afternoon that it has paid $700 million in cash to acquire ITA Software, a flight information software company.
Founded in the mid-1990s at MIT, ITA’s technology provides organization of flight price and schedule information for the major airlines and travel booking companies. With clients including Alaska Airlines, American Airlines, Southwest Airlines, Bing, Orbitz, and Kayak, ITA’s reservation management system has become a crucial component in the management of air travel information.
Travel itself is a major industry, but online travel search is as well, and the acquisition of ITA today could radically change what Google offers to airlines, travel agencies, and customers. Currently, a Google search for travel reservations leads to other major sites – Expedia and Priceline, for example – and a search for flight information only brings up bare-bones departure and arrival times. The acquisition of ITA will help Google, according to the press release, “pursue the creation of new flight search tools that will enable users to find better flight information more easily on the Internet.”
Of course, finding better flight information on the Internet has long been the realm of these other companies, and Kayak, whose business has been as a travel search engine and who is also an ITA customer, might feel particularly pinched.
Google’s acquisitions continue to raise questions about the company’s reach, and perhaps to pre-empt some antitrust concerns, Google’s announcement today came with a press release and website detailing the company’s plans and market position in the travel industry. Google says it won’t be setting prices or selling tickets, for example. And while the acquisition will likely see some government scrutiny, particularly with the size of the travel industry, Google probably hopes that releasing this information early will prevent some of the delays that its AdMob acquisition faced.
