Google allowed to go into travel by Justice Department, but antitrust is next
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Almost a year ago I spoke at a travel conference in the Netherlands. At that same conference someone from Google was speaking. When asked if Google would be going into travel and would become a competitor to all the travel sites in the room, the answer was clear: no.
Until Google bought a company called “ITA Software“, which according to its website is “is a leading provider of innovative solutions for the travel industry”. This company is now acquired by Google. Under “stiff conditions” the Justice Department, which had looked into the deal, allowed the purchase.
Google is paying $700 million for the ticketing software company. To make the deal happen they had to live up to some restrictions. They for example buy the license to the software for five years, so they are not fully owners. They promised however they would continue to upgrade it and establish firewalls to protect ITA clients’ intellectual property.
So the Justice Department says it is ok, but travel website owners still might want to look at the U.S. antitrust regulators who also look into the purchase. The antitrust regulators are especially interested in the claims that Google might be ‘downgrading’ specific search results from competitors, making them harder to find.
Herb Kohl, chairman of the Judiciary Committee’s antitrust subcommittee says:
“We continue to scrutinize broader questions about the fairness of Google’s search engine, and whether it preferences its own products and services to the detriment of competitors.”
Google is running into several issues with this topic, both in Europe and the US so it will be interesting to see if Google will indeed be allowed to go into travel, something many travel sites will fear.