Thursday, July 1, 2010

Google Buys Modern Day OAG - Sets Sights on Travel

I'm sure many of you remember the days when Compuserve was owned by H&R Block and one of the many online services offered (very early in the game) was reserving an airline ticket.  The provider of that information was OAG (or Official Airline Guide).

It was a time that just being able to do it and know it was a 'done deal' was exciting for many of us.

OAG is still very much around. Their primary clients are Travel Professionals, Aviation and Cargo.  Compuserve is also 'still around' and was acquired in 1998 by AOL.

We live in a time where real-time information is everything.  Mapping and GPS information companies have been acquired and deals have been cut with satellite companies to provide information directly to Internet and  many other companies.

This bring us to the announcement today on the Official Google Blog - "Taking off with ITA".

Yes, Google has acquired a significant real-time information provider ... in the airline space....  known as ITA Software. Coincidentally (I'm sure) an information provider to Microsoft's competing search engine Bing and Bing Travel.

In addition to Bing, ITA lists many prominent clients including Alaska Airlines, American Airlines, Bing, Continental Airlines, Hotwire, Kayak, Orbitz, Southwest Airlines, TripAdvisor, United Airlines, US Airways, Virgin Atlantic Airways and (lots of) others.

The tentative price tag is $700 million which appears on the surface to be a bargain in a highly competitive (and often search and web visited) industry.

Google mapped the deal here as well as promising to honor existing agreements and commenting that "the deal  will not alter existing market shares".

As someone who spent 5 1/2 years doing in-house SEO for a small (but potent :) Internet based travel provider, I found the following statement interesting:

"The acquisition will benefit passengers, airlines and online travel agencies by making it easier for users to comparison shop for flights and airfares and by driving more potential customers to airlines' and online travel agencies' websites. Google won't be setting airfare prices and has no plans to sell airline tickets to consumers."

As Google continues to integrate their various services, I can imagine not only shortcuts to airlines and flights in the main Google search index, but possibly recent photos of destinations from Picasa, imagery in Google Earth (and the thousands of photos and videos there from Google-owned services such as YouTube and Panoramio).

Those that follow the search space and / or content-licensing arena can only begin to imagine to monetization possibilities here.

Yahoo!'s CEO Carol Bartz recently commented that Google "needed to diversify".

While I have felt they have been all along, if there was ever any doubt by anyone, they just did ... and in a big way.

You can read the Press Release from ITA here (PDF) or the Google Press Release here.