Google (NASDAQ: GOOG) has announced a $700 million acquisition of ITA software, which provides data for travel search engines.
The deal announced on Thursday is one of the largest acquisitions that Google has attempted to make and will likely give the company a strong influence in a key area of electronic commerce. Henry Harteveldt, an analyst at Forrester Research, said that travel is the biggest market of e-commerce and that air travel is the largest section of that market.
Google CEO Eric Schmidt said that he expects antitrust regulators to take “a fair amount of time” to approve the deal, but that “We expect this will go through.” Google’s $750 million acquisition of AdMob also received regulatory review, but was approved in May. Some believe that Microsoft’s success in travel search could help Google side-step the anti-trust process. Travel has been one of the areas that Microsoft’s Bing search engine has seen success.
ITA, founded in 1996, is known for a software technology which is used by airlines to maximize the yield of sale of seats and is used by online travel agents to find suitable flights. ITA makes the bulk of its revenue by selling is technology.
Google is expected to use the seat information to bring more travel searchers and related advertising. Many believe the deal would put Google in competition with travel meta-search engines such as Kayak.
