Google to dominate online travel selling, we hope

Google to dominate online travel sellingLate last week, Google won government clearance on its $700 million bid for ITA Software in a deal that opens the door for the innovative Internet search powerhouse to dominate online travel selling.

ITA Software, who’s latest innovations include include ITA PSS, a next-generation passenger services system, Needle, a smarter way to organize and publish data on the web, and OnTheFly, an airfare shopping mobile application will make a nice addition to Googles stable of brands. ITA already powers the reservation systems of most US airlines and several online fare-comparison brands like Kayak, TripAdvisor and Hotwire. It looks like a match made in heaven as tech-savvy Google gets an infusion of travel sense from a leader in that game.

But there is a catch. Make that possible bump in the road that we hope they get over smoothly.

While Google is buying and hiring to solidify the top position in all it does, it’s competitors and the government are looking very closely at what they are up to. They fear Google could use it’s substantial Internet search engine clout to monopolize the online travel business.

Would that be the same fear Yahoo might have had about Google’s search engine capability? Perhaps a natural order of things will play out here too.

To win approval, Google agreed to ongoing federal monitoring of its behavior. Google also agreed that ITA will continue to provide service to existing customers for five years in a “reasonable and nondiscriminatory way”. That should satisfy the Federal Trade Commission and Justice Department for a while but they both have Google in their sights, ready to pull the trigger on a full-scale investigation, given the chance.

In his blog, Google’s Senior Vice President Jeff Huber writes:

“How cool would it be if you could type “flights to somewhere sunny for under $500 in May” into Google and get not just a set of links but also flight times, fares and a link to sites where you can actually buy tickets quickly and easily? Well that’s exactly why we announced our intention to buy ITA Software, a Cambridge, Mass.-based company that specializes in organizing airline data last July-and we’re excited that the U.S. Department of Justice today approved our acquisition.”


Last July, Gadling’s Darren Murph called the ITA buy “a huge win for consumers who are tired of crawling three different airline search engines to get a somewhat comprehensive look at their options.” adding “we personally can’t wait for this marriage to officially bear fruit.”

Now that the sale has been approved and Google has agreed play nice, we should start seeing something pretty quickly. Until then, there’s always Google maps:


Flickr photo by brionv

So google is buying ITA Software. What does it mean for you, air traveler?

First of all, what is ITA Software? Briefly, it’s a technology company based in Cambridge, MA that provides the airfare search software behind such sites as Orbitz, Kayak and many airline web sites. Its claim to fame is that it digs deeper into airline reservation systems than some other technologies, and usually finds fares that are only available via the airlines’ own websites. And it allows users to do an easy flexible date search over any 30-day period.

But: It does not provide searches on Southwest AIrlines, Allegiant Airlines, Ryanair, and a few other smaller carriers. Similarly, low-cost leader Spirit Airlines keeps its best fares for Spiritair.com.

Nor can ITA calculate promo code or some other special airfares that the airlines reserve for their own web sites.

Recently, for example, US Airways tweeted fares from Philadelphia to Tel Aviv for $99 each way plus tax, summer travel. JetBlue tweets frequently as well, with $10 fares. United recently tweeted 20% off discount codes. These deals were not picked up by ITA Software. If airlines increasingly market their best deals through narrow channels, and keep them from ITA, it will further change the fare finding game. My thinking is that if airlines can figure out how to eliminate all third parties, such as profitable Southwest has done, they’ll do it.ITA also doesn’t include the “name your own price” fares you can find on sites like Priceline.com, which are often quite good if you don’t have a sufficiently large advance purchase window. And it doesn’t include consolidator airfares. In fact, no airfare search site includes all of these things.

So will the Google acquisition change airfare search for the better? Online airfare search “is ultimately not a very good user experience,” Google CEO Eric Schmidt said on a conference call. “There’s clearly room for more competition there.”

That’s an interesting statement. More competition? Compared to other categories, airfare search is anything but devoid of competition. Recently, TripAdvisor got into the game, as did Travelzoo with its fly.com site. That’s in addition to sites like Expedia, Travelocity, Orbitz, Cheaptickets, Hotwire, Booking Buddy, Farecompare, Yapta, Cheapair, and about a dozen others. ITA Software powers many of these sites already.

ITA does not sell airfares directly. It only shows what it believes the lowest fare to be on any given route, and then you need to conduct a separate search on the site of your choice to find the fare. Most people go directly to airline web sites to complete purchases, although sometimes the cheapest fare will be outbound on one airline and a return on a second airline, which is where the online travel agencies (OTAs such as Travelocity and Expedia) have an advantage, since they show fares on more than one airline. Will Google turn ITA into a fare-selling engine, in competition with its paying customers? Who can say?

Of course, Google is already in the fare search business. If you Google a term like “Boston to New York depart Dec 13 return Dec 15 2010” (try it), the top unadvertised search result will be a google-generated search box allowing you to click on many major OTA’s and meta-search sites.

But it will not actually return fares without further clicking. Perhaps at some point an ITA-generated fare result will pop up, showing the lowest price your Google search, instead of sending you to an OTA’s link.

Airfare search is such a crowded, ever-changing business, fraught with uncertainty and risks that it’s interesting that Google wants in. But I’ll have to assume they know what they’re doing.

George Hobica is the founder of Airfarewatchdog™, the most inclusive source of airfare deals that have been researched and verified by experts. Airfarewatchdog compares fares from all airlines and includes the increasing number of airline-site-only and promo code fares.

[Flickr image: tortuga767]

Google acquires ITA: the search for bargain airline deals is about to get even easier

You’re an avid traveler, right? Sure, why else would you be reading this? Chances are that you’ve spent some quality time at either Kayak, Airfare Watchdog, Bing Travel or one of the many other niche ticketing sites in search of deals over the past few months. To that end, you’ve probably spent next to no time at Google searching for the same thing. But the obvious question is this: “why not?”

That’s a question that has obviously been bugging Google, which is a master of all things search in most every other category. For whatever reason, Google has allowed a number of other, typically smaller competing sites to grow their user base without any interference. But if Google’s so great at finding images via keyword, remedies to your strange medical conditions or more details on that vehicle you’ve been meaning to investigate, why can’t it do the same for travel?

Enter ITA Software, a Cambridge-based software firm that was born from an idea within the minds of a few bright computer scientists from MIT. Currently, the outfit is home to a highly advanced QPX software tool for organizing flight information, which is used by leading airlines and travel distributors worldwide including Alaska Airlines, American Airlines, Bing, Continental Airlines, Hotwire, Kayak, Orbitz, Southwest Airlines, TripAdvisor, United Airlines, US Airways, Virgin Atlantic Airways and others. Moreover, it’s now offering a completely new airline passenger reservation system to improve the customer experience. And as of today, the company is an integral part of Google…
Google has ponied up $700 million in order to acquire ITA and turn the tables in the online ticket search business, but what’s most interesting here is that there’s a good chance the resulting search engine will not only do its own thing, but also bring in results from your existing favorites (Kayak, for instance). In a way, it’ll be the ultimate airline ticket search engine, pulling information from every nook and cranny available and organizing it in a way that the Average Joe or Jane can fully understand and take action on.

Once the acquisition is complete, Google aims to “make it easier for you to search for flights, compare flight options and prices and get you quickly to a site where you can buy your ticket.” It’s important to note that much like Kayak, Google won’t actually be selling you an airline ticket directly; it’ll simply be providing the access to buy one. Still, this all sounds like a huge win for consumers who are tired of crawling three different airline search engines to get a somewhat comprehensive look at their options, and we personally can’t wait for this marriage to officially bear fruit.

[Source: Google]