DOJ approves Google's ITA deal ... with caveats

By David Goldman, staff writer


NEW YORK (CNNMoney) -- Google can have its precious flight data company if it promises to play nice, the Department of Justice said on Friday.

The DOJ approved the $700 million takeover deal between Google, the world's largest search company, and ITA, the world's largest airline search software company, provided that Google accept certain restrictions.

The search giant would have to continue to licence ITA's software to airfare websites "on commercially reasonable terms." Google (GOOG, Fortune 500) would also be required to maintain and enhance that software in a manner consistent with ITA's research and development investment over the past several years.

The company would also have to put an internal firewall in place to prevent Google from accessing "competitively sensitive information" gathered from ITA's customers. Google also can't enter in exclusive contracts with airlines that would prevent the airlines from providing certain ticketing information to the search company's competitors.

"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 of the Department of Justice's Antitrust Division, said in a prepared statement.

The worry, of course, is that Google maintains a 65% share of the search market. If its access to flight information is superior to its rivals, it could easily shut out the competition.

Boston-based ITA specializes in organizing airline data, including flight times, availability and prices. Its data is used on a host of websites like Kayak, Orbitz, Expedia.com, TripAdvisor and Microsoft's (MSFT, Fortune 500) Bing, as well as a number of airlines' websites.

FairSearch.org, a group representing Expedia and Kayak, said Friday that it was pleased with the DOJ's terms for the deal, calling it a "clear win for consumers." Kayak, with backing from Expedia.com, had offered last year to buy ITA to prevent Google from purchasing it.

When it announced the ITA deal last July, Google said it had no intention of selling airline tickets, but it would likely direct consumers to sites on which they can buy tickets. Google's users already come to the site for travel searches, but find it difficult to express flight queries through the current search tools, the company said.

With its ITA purchase, Google said it intends to make airline searches simpler. The company painted a picture of the online travel landscape as one of mass confusion, with thousands of options and unclear ticket pricing and availability.

For instance, Google could use ITA's software to field more advanced searches, like "Where can I travel for $700?"

The proposal still needs to gain approval from a federal judge. The DOJ's Antitrust Division filed an antitrust lawsuit Friday in U.S. District Court in Washington, D.C., to block the deal. The DOJ then filed a proposed settlement with all the restrictive terms that, the Justice Department said, would alleviate those antitrust concerns.

A Google representative was not immediately available for comment on the proposed settlement's terms.  To top of page

Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Index Last Change % Change
Dow 16,805.41 127.51 0.76%
Nasdaq 4,483.72 30.92 0.69%
S&P 500 1,964.58 13.76 0.71%
Treasuries 2.27 -0.00 -0.09%
Data as of 1:18pm ET
Company Price Change % Change
Ford Motor Co 13.78 -0.62 -4.31%
Microsoft Corp 46.13 1.11 2.47%
Apple Inc 105.22 0.39 0.37%
Bank of America Corp... 16.72 0.12 0.72%
Yahoo! Inc 43.50 0.90 2.11%
Data as of Oct 24

Sections

New York headlines took a straight forward and direct approach with NYC's Ebola news. More

The midterm elections are around the corner, and the economy remains a top concern. With unemployment down and inflation low, why do people still feel the economy stinks? More

Shares of Facebook recently topped $80. They've more than quadrupled from their post-IPO lows of two years ago. Can Mark Zuckerberg keep the momentum in mobile going? More

Host a furniture market. Here's how small town High Point, N.C. rakes in this much money -- twice a year. More

If you're looking to fly this holiday season, the clock's ticking to get the best prices. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.