Katie Hallen - Has Google just placed Kayak's IPO in jeopardy? Late last week as we headed into the holiday weekend, news broke that Google has signed an agreement to acquire venture-backed ITA Software, a Boston-based company that specializes in organizing airline data including flight times. ITA's technology is known to process large amounts of data really, really fast. It's used by Kayak, TripAdvisor, Orbitz, Expedia, and Microsoft's Bing Travel (previously Farecast).
Google will spend $700 million to acquire ITA, according to news sources. The Wall Street Journal reports that ITA had previously asked for a cool billion.
Kayak, which generated $150 million in revenue last year, has long been rumored to be pursuing an IPO, an exciting development in a day where so few companies have the resources to float their stock. But now as Google appears to move into the travel business, Kayak's future looks uncertain.
It's always interesting to note how Internet companies take shape and change their mission over time. Google is no longer just a place for search but a significant portal - the first destination for many on the Web.
As consolidation in data processing and search continues, we should except Washington and its antitrust lobbyists to take note. What's unclear with this latest move from Google is whether the company is expanding its own in-house capability or simply taking out would-be competitors.