Thursday, July 1, 2010

Google's Buy of ITA: Where Now For Bing, Expedia?

Search engine giant Google said Thursday afternoon that it is buying ITA Software, a Cambridge-based provider of travel booking software for online travel agencies, for $700M. The buy presents a major challenge to at least two area firms, Microsoft and Expedia, as well as TripAdvisor, which is also owned by Expedia. ITA Software also provides booking functionality for Alaska Airlines, Continental Airlines, Hotwire, Kayak, Orbitz, Southwest Airlines, United Airlines, US Airways, Virgin Atlantic Airways. Google, in its acquisition, said that it would honor all existing agreements with firms, but in pre-acquisition negotiations, a number of ITA's customers apparently had tried to put in their own bids for the company to prevent Google from acquiring the firm. Conceivably, the acquisition of ITA by Google could allow Google to shortcut travel searches directly to ITA, bypassing a slew of online travel agencies. For its part, Google said it will use the buy to "create new ways for users to more easily find flight information online".