Google, ITA, and the Future of Travel: It’s All About Data, Not Search

4/23/12Follow @gthuang

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the pieces knitted together a lot better. Right now, in other things, you get used to a pretty seamless experience. If you want to do something, lots of companies—Google and others—have been very successful by making it as simple as possible, as few gestures as possible, to accomplish what you want,” he says. “We’ll do a lot of work under the scenes so that what you’ll see on top is nothing. You’ll just basically get to the airport, we’ll know you’re Greg, we’ll know you’re going to San Francisco, and you’ll be able to do the few things that actually matter.”

Wertheimer sums it up this way: “We want to make planning a trip no harder than buying a book or a song or a movie, and executing on it no harder than executing on buying [those things]. That would be my goal.”

To that end, ITA’s business, including its revenue model, is “pretty much as it was” before the acquisition, says Wertheimer. “We put the name on, ‘[ITA Software] by Google,’ but didn’t actually change the business that much. We liked the path it was on, Google liked the path it was on—we’re still on the path.”

But that raises a question about the future of the reservation system (PSS) part of ITA’s business—and what Google’s interest in that might be. After all, it seems unlikely that Google wants to invest in building software for airlines to run their businesses. But there might be more than meets the eye here.

What if ITA’s system (used currently by Cape Air) became the back-end technology for lots of airlines? Would that allow Google, with its vast computing and analytics capabilities, to connect the dots and radically transform travel logistics and business in ways we can only imagine? In an ideal world, could some sort of real-time, global airline and air-trafficking system reduce delays and reroute flights more efficiently? (In case you haven’t noticed, Google doesn’t talk much about its future plans. So it’s up to me to speculate.)

It’s All About the Data

Wertheimer begins with a caveat. “One distinction I draw is, when you fly on Cape Air, it’s not that Google knows everything about your Cape Air flight,” he says. “Cape Air knows everything about your Cape Air flight. We happen to have written the software on the computers, but your relationship is with Cape Air. It’s not like that information is now dumped into the big pot of all things that could be used. There are lots of controls.”

That said, there are certain aspects of travel that could be coordinated in smarter ways, he says. One idea is for airlines to track your bags and have them delivered to your hotel after you arrive at your destination. Wertheimer also points to a “re-accommodation system” in ITA’s airline reservation software that automatically deals with problems such as flight cancellations and communicates with travelers via cell phone to tell them their options. “We have pretty sophisticated technology to do full-scale planning in that moment: here are the passengers affected, let’s go re-plan and figure out what needs to be done,” he says. “It’s fun, coming from AI, that’s the kind of ‘automagic’ system where you can go, ‘Oh look, it’s intelligently looking at all the different things that are broken and fixing them.’ So you’ll certainly expect more of that. And gee, wouldn’t it be nice if you could coordinate that across travel suppliers?”

I wondered how Google’s ownership would affect ITA’s prospects for landing new airline customers. The sense I got was that while there might be a competitive “fear factor” to overcome for travel sites licensing ITA’s pricing and shopping software (QPX), the company’s reservation software (PSS) might actually get a boost. Gianni Marostica, ITA’s former chief commercial officer and now Google’s commercial director of travel, says that ITA, despite its growth, was “still a reasonably small company.” Airlines “don’t know if they want to sign a big enterprise-wide deal with a small company,” he says. “Now we’re part of a bigger entity, and there’s more oomph to push it forward.”

Selling and coordinating software across different airlines is one thing—but what about other modes of transportation? If international travel is a growth market, then incorporating train schedules in Europe, say, should be important to Google. “You want to have more data, and you want it as comprehensive as possible. Where’s the train, bus, cab, where’s the pack mule?” Wertheimer says. “The dream is certainly to integrate every bit of information that’s there. Often it’s just a matter of working with suppliers, convincing them that this is relevant to them.”

And that brings us, finally, to an overarching theme for understanding Google’s vision for travel: it’s all about the data. The first part of the theme is travel data. If you’re interested in getting from point A to point B, Google wants to show you all the relevant ways of making the trip; right now it’s by plane, public transit, or driving, biking, or walking directions, but eventually it could include more options like intercity railways, buses, ferries, robot cars, or (if someone would kindly invent one) teleporters. Google also wants to show you stuff that helps you plan your trip: maps, hotels, restaurants, car rentals, package deals, stops along the way. All of this takes a massive, ongoing effort in data collection and integration. (Wertheimer says there are ITA employees who work on nothing but tracking tax rules and conditions, so as to keep all ticket prices accurate and up to date.) ITA gives Google a leg up on understanding airfare pricing and relationships with airlines and online travel agencies, but that’s just one piece.

“As with any network that you’re growing, the benefits of being part of it for the supplier keep increasing,” Wertheimer says. “I’m optimistic over time. But it’s not like in the blink of an eye everything will be there. It’s a slog.”

The second part of the theme is about your data. In particular, tying together the various travel-related experiences a consumer might have … Next Page »

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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