Travel market penetration planned by Google

As if search engine giants Google don’t have enough fingers in various pies, they have now announced that they intend to begin providing services for people travelling by air. Since purchasing ITA Software, a firm which provides flight information for travellers, Google looks set to begin competing in the holiday and business travel industry.

ITA Software offers airline flight information including journey duration and fares, which is used by flight comparison sites and travel agents. In a $700m deal, Google acquired ITA Software, a firm set up in 1996. The company beat off competitive bids from Travelport, Kayak and Expedia to secure ITA. Google intends to provide a service to users so they can search for flight information by destination, focusing on end user requirements. The company has no immediate plans to sell tickets for flights, commenting that their operations will remain in line with ITAs partner agreements including Microsoft’s Bing Travel.

There are concerns within the industry that Google is now controlling too much, including the flight data used by a wide range of organisations. Although Google asserts that their approach is all about encouraging competition and providing a consumer service, critics are still wary. It is likely that the recent deal will be closely monitored by industry regulators. Plans by Google to include hotel information suggest that the company intends to provide an equivalent service to sites such as Opodo.

Simon Calder, travel adviser for the Independent, commented: “If anything, the airline industry used a system that you could describe as the forerunner to the internet. The aviation industry used GDS – the Global Distribution System – for decades, because there were computers in travel agents, airports and airlines across the globe.”

“Now it consolidates around Amadeus, Sabre, Galileo and World Span and these still have legacy aspects. For example, if you book a flight from London to Mexico City via Dallas, you will still have to pay $3 for each segment. If Google can do something to rival that, it would be very interesting and exciting. But, as with all things to do with Google, the issue of market domination comes up.”

“While there is great competition when it comes to transatlantic flights, from smaller airports, the choice for a passenger is more limited. There are plenty of price comparison sites already and for someone booking flights, the system is almost perfect, so I don’t see how Google is going to get a slice of that.”

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