Google Buy Of ITA Gets Nod From Justice Department

The U.S. Department of Justice and Google have proposed an agreement to allow the Internet's biggest search engine to buy ITA Software, the travel data company, for $700 million.

The deal puts limits on what Google can do with the technology it will get from ITA, and would be in force for five years.

Under the settlement Google must license ITA's QPX software to other airfare web sites on commercially reasonable terms. QPX is the engine that many travel sites use to seek out the airfares that users see displayed.

Companies that opposed the deal, among them Expedia Inc., Farelogix Inc., KAYAK, Sabre Holdings and Microsoft, expressed concerns Google might not renew their license agreements with ITA, effectively crippling them. In a blog post, Jeff Huber, Google's senior vice president for commerce and local, said the company committed to letting ITA's current customers extend their license contracts to 2016.

Google will also have to implement firewalls that prevent use of competitively sensitive information and data gathered from ITA's customers. The Justice Department didn't say if that also applies to source code. The competing travel sites have said that by itself raises concerns about anticompetitive behavior.

Google is also not allowed to sign agreements with airlines that would cut into their right to share seat and booking information with Google's competitors.

An organization called Fairsearch.org, was formed by several companies opposing the deal to lobby against it. Fairsearch is concerned that Google will privilege its own travel sites over others in search results.

If the settlement is approved there will be a 60-day comment period. Meanwhile, if Google does not agree, there is the threat of an antitrust lawsuit to block the acquisition. But such lawsuits are rare once a proposed deal to address competitive concerns is on the table.

Google has had its share of battles with the Justice Department over mergers and anticompetitive behavior. The company was forced to abandon a deal with Yahoo in 2008. But the company was allowed to buy AdMob last year, as well as DoubleClick in 2007.