Will Google Fly Into Travel Search With A $1 Billion Acquisition?

Google (NSDQ: GOOG) may be about to make its entry into the travel search market — but not quite in the way people expected. Rather than buy a travel search engine directly — like Microsoft (NSDQ: MSFT) did when it bought Farecast or Yahoo (NSDQ: YHOO) did with FareChase — Google is reportedly interested in buying ITA Software, a company which provides back-end search and booking technology to both the airlines and travel search engines themselves. ITA’s clients include a who’s who of the top travel sites, including Kayak, Orbitz and even Microsoft’s Bing Travel. Bloomberg, which reported Google’s interest, says ITA Software may be looking to sell for about $1 billion, which would make the purchase Google’s third largest after DoubleClick and YouTube.

As we pointed out in December, travel is a big gap in Google’s current line-up of search offerings, especially since it has been a priority for Microsoft, which has heavily promoted Bing Travel, which lets users easily find–and book–flights and hotels online. Presumably, Google would use ITA Software to build its own travel search engine, although it’s not clear why it couldn’t do that on its own — or even with ITA Software as a vendor (Picking up Orbitz, by the way, would also be cheaper — even with a hefty premium — since that company’s market cap is about $700 million).

Google has been spending freely on acquisitions lately — buying twelve companies in nine months. In fact, it made its latest purchase today when it bought stealth hardware startup Agnilux, which was founded by several former Apple (NSDQ: AAPL) chip developers. As for the latest acquisition talk, a Google spokesman tells us, “While we’re always talking to various companies about a variety of things, we don’t comment on rumor or speculation.”