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Asia takes Google-ITA news in its stride

Posted on 02 Jul 2010 at 19:02 pm by Yeoh Siew Hoon

While the travel world has gone berserk over today's announcement that Google has bought ITA Software and speculating what this means for air fare search in particular, players in Asia seem to be taking it in their stride. (See the expert analysis in TNooz)

Perhaps it’s the knowledge that ITA Software’s strength is in the US and Google, while a dominant player in Asia, is facing problems of its own in China but thus far, the news has created only a small ripple of interest.

One meta-search player, who noted it was too early to speculate in the absence of “enough confirmed information regarding Google's intentions”, said, “My personal view at this stage is that ITA's relevance for flight searches originating within Asia is not as extensive as the US, so a lot more work will need to be done to make ITA relevant for Asia.

“There are still a lot of unpublished fares being sold in markets like Hong Kong which are not captured by ITA.”

ITA, founded in 1996, is a Boston-based software company specializing in organizing airline data, including flight times, availability and prices. It offered itself as an alternative distribution system to airlines and online travel agencies but has not managed to make much headway in Asia due to the complex air fare market in the region.

In a press release announcing the acquisition, Google said the deal would allow it “to pursue the creation of new flight search tools that will enable users to find better flight information more easily on the Internet”.

In a blog, Google wrote, “While online flight search is rapidly evolving, we think there is room for more competition and greater innovation. Google has already come up with new ways to organize hard-to-find information like images, newspaper archives, scholarly papers, books and geographic data.

“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.”

In China, Fritz Demopoulous, CEO of travel search, said, it was no surprise to see Google making its move into travel given it is its bigger revenue vertical.

He asked, “The most prominent alternatives – Kayak, Bing, TripAdvisor –subscribe to ITA's services. Could that be a problem for those companies?

“Google/ITA could preclude selling to those sites, but this seems unlikely given the potential for anti-trust backlash.”

He said a more likely outcome might be that “Google slows down Kayak-Bing-TripAdvisor's speed of innovation, which would naturally benefit Google's relatively slower product development team. By the way, this is from Microsoft's playbook in the 90's.

“Of course, anyone could replicate ITA by directly searching sites and/or securing data feeds directly from airlines. Companies like Everbread have a good model, and more and more may become prominent as Google alternatives seek neutral data sources.”

Carrying bigger headlines here is the news that Google is still awaiting Beijing’s decision on whether its operating licence would be renewed. One of its Web search features was blocked in China yesterday, Google said.

Googe closed its China-based search engine March 22 and began routing users to its unfiltered Hong Kong site. However it stopped the practice this week because the Chinese government threatened to revoke its operating licence, said media reports.

Tags: Google , ITA Software , air search , Qunar , China