Google's Flight Search Ruffles Feathers
Online travel websites aren't happy with Google's (GOOG) latest move.
Earlier this month, the world's leading search engine began pushing its own flight search feature ahead of other organic results.
Punch in "MIA to LGA" in a Google box, and the first thing you'll see (after a shaded box of sponsored search results) is Big G's own comparison engine doling out the cheapest airfares across available airline carriers.
It's after the ads and the Google flight search option that third-party providers including Expedia (EXPE), Orbitz Worldwide (OWW), and fellow rate aggregator Kayak.com appear organically. Being bumped lower on the first page of the search giant's results will probably result in lower traffic for the established online travel websites -- and they're naturally not happy about that.
Google Planned This Trip
When antitrust regulators and a federal judge cleared Google's $700 million purchase of ITA Software earlier this year, it was really just a matter of time before this happened. Why else would the dot-com darling have spent so much to secure a leader in flight-search data?
Consumers are unlikely to mind. No one types in a pair of airport codes unless they want to see what flight options are available, and Google is making it more convenient to get to the information they crave.
Airlines are outright loving this move. Google flight searches link directly to the carriers, saving them the need to pay Expedia, Orbitz, and other travel websites chunky commissions for leads that translate into bookings.
Expedia may have been around for ages as an online travel pioneer -- and Kayak has been scouring available travel-related rates for years -- but Google's move is evolutionary. Legacy carriers that have historically struggled with sustainable profitability now have a more cost-effective path to secure bookings, and passengers won't complain if this grants airlines the flexibility to perhaps even lower their rates.
Everybody wins, except for the travel websites, but don't expect that to silence the accusations that Google has turned into a bully.
Goliath v. 2.0
Google's "Don't be evil" mantra has been tested over the years. It has been kind to the search results of Wikipedia, even though the perpetually updated nature of the public encyclopedia makes it a shaky resource. Wikipedia's refusal to carry advertising also means that Google may be denying traffic to some of its partner sites that pair up content with Google's contextual marketing ads.
However, now Google is ready to be more than just Mr. Nice Guy; in fact, Big G just might be ready to be Microsoft (MSFT), which famously took advantage of its popularity as an operating system provider to push its Internet browser, media player, and even Office suite of productivity programs on users.
Is Google now ready to take a more active role in cashing in as the search engine of choice throughout most of the world? Online travel websites will complain. They are now being forced to advertise on Google, and to pay enough to be one of the top three marketers to show up ahead of Google's search flight box as sponsored search results.
Is that fair? Has Google gone too far? Is this simply a matter of Google being financially smart enough to take advantage of its pole position in search?
Folks will complain, but in the meantime, I'm off to Google to start researching my next getaway.
Longtime Motley Fool contributor Rick Munarriz does not own shares in any stocks in this article. The Motley Fool owns shares of Microsoft and Google. Motley Fool newsletter services have recommended buying shares of Google and Microsoft as well as creating a bull call spread position in Microsoft.