OTAs appeased as US regulators get tough

US regulators have vowed to continue scrutinising the fairness of Google’s search results despite granting the technology giant approval to buy Massachusetts-based ITA Software.

The Department of Justice has said it will not stand in the way of a deal, but has warned strict conditions will be placed on Google.

It follows strong opposition to the acquisition by FairSearch — an alliance of online travel agents including Expedia, Travelocity, Sabre and Zuji. ITA develops software used by many of these OTAs to collate and present airfares, schedules and availability.

The alliance feared that in buying ITA, Google would effectively try and manipulate search results to favour their own advertisers, rather than steering consumers to the best deal.

There were also fears Google may try to become an OTA in its own right and prevent competitors from having access to the technology. Google has said it is simply looking for a way to better present fares to consumers and is not interested in becoming a transactions business (Travel Today, July 30, 2010).

Nevertheless, under the terms of the deal, Google is required to continue to develop and license ITA’s software to other companies, easing the fears of OTAs.

Google is also prohibited from striking deals with airlines that would restrict the airlines’ right to share seat and booking information with Google’s competitors.

Joseph Wayland, deputy assistant attorney general with the DoJ’s antitrust division, said: ”The proposed settlement assures that airfare comparison and booking websites will be able to compete effectively, providing benefits to consumers.”

In a statement, FairSearch said the conditions were a “clear win for consumers”.

“The Department concluded Google’s unrestricted control over ITA’s key flight search technology would have violated the antitrust laws,” FairSearch said.

And in a warning to Google, US Senator Herb Kohl, chairman of the Senate Antitrust, Competition Policy and Consumer Rights Subcommittee, said: “We continue to scrutinise broader questions about the fairness of Google’s search engine, and whether it preferences its own products and services to the detriment of competitors.”

Resorts And Lodges