Google Buys Frommer’s, But What Are The Risks?

Earlier this month it was announced that Google had acquired another company.  Normally, Google acquiring another company would be a small news story—it acquires many companies in an attempt to grab new technologies and talented engineers.  But this acquisition made news because it wasn’t just another tech company—the acquisition is of Frommer’s, the well-known series of travel guides for globetrotting tourists.  With the purchase of Frommer’s, Google takes another step into becoming a destination for consumers searching for travel information.  This comes on the heels of another move Google made late last year when they purchased Zagat, the well-known restaurant guide.  The move gives Google a wealth of information on destinations all over the country and gives them a great advantage in their work in the travel planning industry.

Google’s purchase of two travel publishing brands might make some curious of what their plans are.  Last year, Google also acquired a technology company called ITA Software, a company that made the software that powered the majority of travel websites—Orbtiz, Kayak, Hotwire and TripAdvisor, among others.  The purchase went through late last year, making Google an extremely powerful player in this industry—both because of the software that it owns and can use for its own means, and because they hold the fate of so many competitors in their hands.  Google has been holding their travel industry plans close to the vest, but these two acquisitions might give some clues to competitors what they plan for the future.

Some will remember the strong opposition from many consumer watchdogs and those in the travel industry when they purchased ITA.  Many observers worried that Google owning the technology that powers the entire travel website industry, combined with dominating over 66% of the search market, would lessen choice for consumers.  Observers were worried that the purchase would put too much power in Google’s hands and would begin to dominate, unfairly, the travel information and decision industry.  With Google’s purchase of Frommer’s and Zagat, those observers’ worries surely aren’t alleviated.  Google is poised to become a one-stop shop for anyone’s travel needs.

The acquisition of Frommer’s and Zagat show that Google is interested in much more than just travel technology.  They’re now owners of reams of data and information on travel that it can use in the fight against their competitors—competitors who are beholden to them and the technology they own through ITA.  As part of its deal with the government when purchasing ITA, Google is only required to license its software to companies like Kayak for 5 years.  What happens then?  And with many competitors relying on Google to drive traffic to their sites (Kayak gets 10% of its traffic from search engines), could Google choke off traffic to their competitors and direct them to their own content, as the American Consumer Institute worried in the past?  As the article states, “If online travel becomes less competitive, consumers should expect to pay more.”  Expect consumer groups and companies in the travel industry to continue to bring this issue up as Google continues to make forays into travel.

Zack Christenson is a digital tech writer for the American Consumer Institute

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