Nobody Should Worry About Google's Online Travel Business Except Kayak

Last Updated May 17, 2010 5:03 PM EDT

The blogosphere is abuzz because Google (GOOG) is now adding hotel rates to its Google Maps application and is reportedly eyeing ITA Software, the travel software responsible for shopping fares to users on Bing Travel, Kayak and Orbitz (OWW). As usual, Google remained coy about its maneuverings, but not so its quaking competition:

Google declined to comment about the acquisition talks. But, says Google spokeswoman Victoria Katsarou, "We always have travel in mind. We're trying to make it easier for our users."

The potential acquisition, if completed, "would be a game changer and a clear signal of Google's interest in travel," says Steve Kaufer, CEO of TripAdvisor.

Let's face it, if Google wanted to be the online travel industry kingpin, it would be. It has enough power and money to crush all its competition (just not having them show up in Google searches would be enough). But the reality is that Google is a media company and makes money off advertising. The more people it can lure into using its services, the more it can charge advertisers -- such as online travel companies like TripAdvisor. It doesn't make sense for Google to be in direct competition with clients.

Many are also seeing the possible acquisition of ITA Software as a boon for Google's Android mobile operating system, which could benefit from its travel search capabilities. With all of Google's recent developments, including Google Goggles, a way to metasearch hotel rates and fares would help the company by keeping those glued to their smartphones away from other search engines.

And while I said earlier that online travel companies shouldn't worry about Google, travel search companies like Kayak should be scared. Kayak, like Google, is also a media company, sharing information in hopes of gaining eyeballs and selling space to advertisers. But Google has more users, can speak 41 languages and already has the home court advantage for most anyone using the Web. Anyone competing with Google as a search engine is going to fail miserably, much less a niche travel search engine. If Google continues its dominance in travel, it will make Kayak and all sites like it obsolete.

Photo: dan_taylor