Officials probe Google travel software deal

 

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By Stewart Mitchell

Posted on 7 Sep 2010 at 12:48

Google's proposed takeover of ITA Software is reportedly under investigation to see whether the deal would give Google too much power in the travel industry.

ITA powers the airline ticket search and booking services on a host of flight and travel sites. Following a $700 million offer from Google, anti-trust officials at the US Justice Department are to investigate whether rivals would continue to have access to ITA data and whether Google's web search results would favour the company's own travel services, a report in the Wall Street Journal has said.

ITA's software is used by flight-comparison sites including Kayak.com, and Hotwire.com, as well as by Bing, Microsoft's search engine.

ITA also has an inside line on the pricing policies of airlines because it powers the search, booking and ticketing functions of numerous carriers, including American and Continental.

Several players in the online travel industry told the paper they were expressing concerns to government lawyers with the intention of spurring them to challenge the deal.

They said that if the deal goes through, Google would become the new gateway for finding airfares and could promote its travel search results over those of rival sites.

"There are legitimate concerns about what that deal could mean to competition in the market and how it could affect consumer choice," Robert Birge, Kayak's chief marketing officer, told the Wall Street Journal.

The news comes just days after the Texas Attorney General launched a separate probe into complaints over competitive practices.

Google has said it is confident that complaint will come to nothing, but critics claim Google is abusing its dominant position to direct surfers to its own services in the price comparison market.