DOJ Puts Conditions on Google's ITA Acquisition
The U.S. Department of Justice will require Google to develop and license travel software to competitors as a condition of its US $700 million acquisition of travel software maker ITA Software.
The DOJ's proposed deal with Google, announced Friday, also would require the company to provide arbitration for complaints about fees from online travel sites, and it would require Google to fund research and development of ITA's travel software at the current rates, the DOJ said.
The acquisition, as originally proposed, would have "substantially lessened competition" among flight search websites in the U.S. and reduced choice and innovation for consumers, the DOJ said in a news release. The DOJ on Friday filed a civil antitrust lawsuit in U.S. District Court for the District of Columbia in opposition to the acquisition, but filed a proposed settlement at the same time.
"The Department of Justice's proposed remedy promotes robust competition for airfare websites by ensuring those websites will continue to have access to ITA's pricing and shopping software," Joseph Wayland, deputy assistant attorney general for the DOJ's Antitrust Division, said in a statement. "The proposed settlement assures that airfare comparison and booking websites will be able to compete effectively, providing benefits to consumers."
The acquisition will make it easier to use a Google search to find flights, wrote Jeff Huber, Google's senior vice president for commerce and local issues, in a blog post.
"It's important to us that ITA continue with business as usual, providing great service to its business partners," he added. "We indicated last July that we would honor ITA's existing contracts. Today we've formally committed to let ITA's customers extend their contracts into 2016."
Several online travel sites have opposed the Google/ITA deal, announced last July. "The end result could be higher travel prices, fewer travel choices for consumers and businesses, and less innovation in online travel search," the group FairSearch.org said when it launched in October.
Under the proposed settlement, Google will be required to continue to license ITA's QPX software to airfare websites on commercially reasonable terms. QPX powers searches for airfares, schedules and availability, the DOJ said.
The settlement will also require Google to further develop and offer ITA's next generation InstaSearch product, which will provide near instantaneous results to certain types of flexible airfare search queries. InstaSearch is in development at ITA.
The five-year settlement will also require Google to implement firewall restrictions within the company that prevent unauthorized use of competitively sensitive information and data gathered from ITA's customers. The proposed settlement tells Google when and how it can use that data, the DOJ said.
Google is also prohibited from entering into agreements with airlines that would inappropriately restrict the airlines' right to share seat and booking class information with Google's competitors, the DOJ said.
Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is firstname.lastname@example.org.