Google Buys ITA Software to Add Flight Search

Google announced the acquisition of ITA Software, a flight information software company from Massachusetts that develops software for airlines, travel agencies and technology companies. One of the many ITA customers is Microsoft, which used its technology to power Bing Travel:

“Bing, Microsoft’s new decision search engine, combines innovative fare prediction technology (previously known as Farecast) with the industry’s leading airfare pricing and shopping system by ITA Software to assist travelers to make faster and more informed choices.”

The list of sites that use ITA’s technology is impressive: Kayak, Orbitz, CheapTickets, Hotwire, FareCompare and more. Google intends to pay $700 million to acquire a long-established company that provides technology for some of the most popular flight search services.

Marissa Mayer says that Google will develop its own flight search service. “Once we’ve completed our acquisition of ITA, we’ll work on creating new flight search tools that will make it easier for you to search for flights, compare flight options and prices and get you quickly to a site where you can buy your ticket.”

Right now, Google shows an OneBox that links to popular services like Expedia, Orbitz and Kayak:


In the future, Google will probably use the OneBox to promote its own service. ITA software offers an online demo of its technology, which includes cool features like interactive calendar for finding the lowest fares, real-time filters and color-coded bars that let you compare flights:


Google officially acquired AdMob!

Last Friday, Google said that mobile advertising was moving fast. Today, Google acquired AdMob. Omar Hamoui has built a great team and great products at AdMob.

It’s clear that mobile advertising is becoming a much larger part of our clients’ and partners’ strategies and with this acquisition, it’s now a central part of our own business. In continuing to invest in this highly competitive area, we’ll be bringing together our technology, resources and expertise in search advertising with AdMob’s innovative solutions for advertising on mobile websites and in mobile applications.

Mobile search is central

One of the key ways that people find and access information on their mobile devices, just like on the desktop, is through search. As smart phones have proliferated, we’ve seen dramatic increases in mobile search volume. Over the past two years, Google’s mobile search volumes have grown more than fivefold, at an accelerated pace. In the first three months of 2010, people with smartphones with “full” WebKit browsers (such as the iPhones, Android devices and Palm Pre) searched 62 percent more than they did in the previous three months.

Increasingly, people aren’t just typing search queries into their mobile devices. They speak them, they take photos of them and they even translate them from different languages.

In addition to traditional search ads on mobile devices, we’ve worked to develop entirely new search ad formats. “Click-to-call” search ads, for example, have been really popular. They enable advertisers to include a local business or national phone number directly in their ad text that you can click to reach the business directly via phone. This is a really great way for you to easily get information from a relevant business (say, a local restaurant), and a highly effective way for advertisers to connect with interested customers.

With many more advances to come, search advertising will remain the central way that many businesses connect with consumers on mobile devices.

Mobile websites and apps

In addition to search, another key way that people access information is through mobile websites (accessed through a browser) and mobile apps (available through Apple’s App Store, the Android Marketplace and more).

Mobile display and text ads make it easy for publishers and developers to make money from their mobile websites and apps, and enable advertisers to extend the reach of their campaigns to relevant mobile content. In this area, AdMob has been a real pioneer and has innovated at a tremendous pace, building a successful business and working with thousands of advertisers, publishers and developers.

AdMob was one of the first companies to serve ads inside mobile applications on the Android and iPhone platforms. They’ve developed a host of engaging and creative ad units for Android and iPhone apps—for example, interactive video ad units and expandable rich media ads. Google has also been developing new features for in-app ads. For example, last week, we announced that we’ll be making “click-to-call” ad formats available to developers who run AdSense in their mobile apps. With Google and AdMob starting to work together, there’s lots more innovation to come in this area.

The future

It’s clear that mobile advertising is growing incredibly fast with lots of businesses innovating at great speed. Every day, more marketers are looking to take advantage of the mobile-specific capabilities, extended reach, great returns and value that mobile advertising provides. Advertisers are now starting to see mobile as an essential part of their overall campaigns, not just a silo-ed experiment on the side.

We want to unleash agencies’ and advertisers’ creativity on all mobile devices and deliver them better results from their campaigns, drive better returns and more choice for publishers and developers, and help people get better ads and more free mobile content.

We believe that mobile advertising can play a significant role in every single marketing campaign. We’re passionate about the unlimited possibilities in this space. Today, with AdMob, our work to make them a reality begins.

Posted by Susan Wojcicki, Vice President of Product Management

Stock Repurchase
As previously announced, Google intends to repurchase in the open market a number of shares equal to the number of shares issued in the transaction and issuable upon exercise of outstanding options to purchase common stock issued by AdMob. The repurchase program is expected to commence shortly after the completion of the acquisition. The repurchases will be funded from available working capital.