Google on Thursday announced a definitive agreement to acquire a software company whose platform organizes flight information for the online travel industry. The search giant will pick up ITA Software for $700 million in an all-cash deal.
ITA was founded in 1996 by a team of MIT computer scientists. The company has developed algorithms that underpin a customizable flight-data organization tool that airlines and online travel agencies, including American Airlines, Continental Airlines, Hotwire and Orbitz, use to power their reservations.
Google smells revenue. The online travel industry generated $124.4 billion in 2009, according to eMarketer, and that figure is set to grow even after doubling in the last four years.
"ITA's very talented team has created an impressive product to organize flight information," Google CEO Eric Schmidt said. "Their technology opens exciting possibilities for us to create new ways for users to more easily find flight information online, and we're looking forward to welcoming them to Google."
Google's research shows that nearly half of all airline tickets are sold online today. But Google's research also found that many people are frustrated trying to find the best deal on flights because pricing and availability constantly change. Marissa Mayer, vice president of search products and user experience at Google, thinks there is room for more competition and greater innovation in the online travel sector.
"Google has already come up with new ways to organize hard-to-find information like images, newspaper archives, scholarly papers, books and geographic data," Mayer said. "Once we've completed our acquisition of ITA, we'll work on creating new flight search tools that will 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."
Google said the ITA acquisition will benefit passengers, airlines and online...
Posted: 2010-07-02 14:36:01
