ITA Software Emerges from Google’s Shadow with New Airline Platform

3/1/12Follow @gthuang

For having one of the larger tech presences in Kendall Square, ITA Software has been quiet lately. Too quiet.

The Cambridge, MA-based travel software firm, which was acquired by Google for $700 million in 2010 (the deal finally went through last spring), hasn’t been saying much about its integration with the Mountain View, CA-based Web search giant (NASDAQ: GOOG). And that hasn’t changed today, but at least ITA is talking about something: The firm is rolling out a comprehensive new software platform that helps airlines manage their reservations and essentially run their whole business. After many years of development work, the system’s first customer is Hyannis, MA-based regional airline Cape Air.

The new system includes software for Cape Air’s reservation management, website management, revenue accounting, seat inventory and logistics, luggage tracking, and a host of other features meant to bring airlines fully into the Internet era. It is complementary to ITA’s main business, which has consisted of itinerary pricing and travel search software. Technologically, the reservation system has a fast, distributed structure based on PCs and Linux, as opposed to airlines’ existing mainframe systems.

“It’s what you would expect if modern computer science were to build an airline reservation system,” says Jeremy Wertheimer, ITA’s co-founder and former CEO (now vice president of travel for Google). “We’ve been working on this for a while.” He adds that while ITA is “all part of Google now,” this part of the business is “not directly related to flight search.”

“There are a lot of good operating systems out there,” says Dan Wolf, the founder and CEO of Cape Air. “But this is capturing the technologies of today that will serve the needs of tomorrow.”

My colleague Wade first wrote about ITA’s reservation system, code-named Polaris, back in late 2008. At the time, ITA had lined up Air Canada as its first customer. But in 2009, Air Canada backed out as it was dealing with financial problems. So the platform was not deployed with that airline. More recently, ITA’s acquisition by Google raised the question of whether the Polaris project would continue, given Google’s strategic focus on flight search rather than software for airlines.

Today’s announcement suggests the project is continuing, though Google, being a search and advertising company, doesn’t seem to be pushing hard on this business direction yet. (The company is more busy implementing its new privacy policy as of today.) Still, Wertheimer says ITA has a team of well over 100 employees—probably closer to 150— working on the reservations platform, which makes up a little less than half of ITA’s total headcount, he says. (ITA’s overall staff size seems to be down from some 500 people in late 2008.)

And in any case, Wertheimer has his eye on the bigger picture—and bigger problems to solve in the travel industry. Talking about the goals of ITA, he says, “You hire really great people, you work hard, and they take on big problems. It doesn’t matter how hard the problem is, they rise to the occasion.”

So look for ITA to sign up more customers on the airline reservation system front. “We’ve done the hard part now,” Wertheimer says. “The airline is up and running.”

Meanwhile, we’ll try to learn more about what ITA is working on with Google in the travel search domain to compete against the likes of Kayak, Expedia, Bing Travel, and TripAdvisor (on the content and reviews side). That would seem to be the greater future of Google’s ITA business.

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com. Follow @gthuang

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