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Google Faces Mounting Resistance to Pending ITA Software Acquisition

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February 16, 2011

Google Faces Mounting Resistance to Pending ITA Software Acquisition

By Beecher Tuttle
TMCnet Contributor


The group opposing Google's (News - Alert) pending acquisition of flight information software company ITA (News - Alert) continues to grow with each passing day. Late last week, Missouri Attorney General Chris Koster publicly raised concerns over the deal and offered his services to the Justice Department, which is currently considering whether Google's $700 million purchase of the software company would violate antitrust laws.

“This transaction causes me concern because of its potential impact on the ability of consumers to search online for competitively priced airline fares in a market that has seen rapid growth,” Koster wrote in a letter to Assistant Attorney General Christine Varney, head of the department’s antitrust division.

 “Ensuring that new sellers can gain meaningful entry into this market, and that all sellers can compete against each other fairly, is our mutual concern," he added.

Google is facing mounting opposition to deal because ITA Software powers the online reservation searches for the majority of airlines and a host of online travel sites, including industry leaders such as group Orbitz, TripAdvisor, Hotwire, Kayak and Microsoft's (News - Alert) Bing, according to the Wall Street Journal.

Critics have asked the Justice Department to kill the deal because it could decrease competition by giving Google the ability to direct consumers to their own travel sites.

"Google will have leverage over the entire online flight industry," Thomas Barnett, former attorney for the Justice Department's antitrust division who currently represents Expedia (News - Alert), told the AP.

However, Google has said that it has no interest in selling travel services through its own site, but would simply refer consumers to other online destinations with the best deals. Google would monetize this offering through an expected increase in ad revenue.

Still, opponents have argued that Google acquisition of ITA would enable it to sidestep around travel sites by delivering consumers directly to airlines, hotels and car rental agencies, the AP reported. Quite obviously, this could put sites like Orbitz and Expedia in a precarious position.

If the Justice Department green lights the deal, Google said it will honor all contracts associated with ITA. After these deals run out, online travel sites that rely on ITA may have to go look for a new piece of software.

Beecher Tuttle is a TMCnet contributor. He has extensive experience writing and editing for print publications and online news websites. He has specialized in a variety of industries, including health care technology, politics and education. To read more of his articles, please visit his columnist page.

Edited by Tammy Wolf

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