Google-ITA Software deal: Microsoft active behind the scenes
In the weeks leading up to Google’s July 1 announcement that it intended to scoop up ITA Software for $700 million, Microsoft, Expedia and Kayak reportedly were involved in considering investments or bids to keep ITA out of Google’s hands.
But, when acquisition opponents this week unveiled their coalition, FairSearch.org, Microsoft’s name was a prominent no-show among the group’s members. Microsoft stated it “is not a member of this coalition, but as an ITA customer, we continue to monitor developments regarding the regulatory review of Google’s proposed acquisition of ITA.”
It should come as no surprise, however, that Microsoft is doing much more than merely monitoring developments.
The search giant — Microsoft, that is — has acknowledged publicly that it has been voicing its concerns to the U.S. Department of Justice, which is reviewing the Google-ITA deal out of competitive concerns. Rest assured that Microsoft lobbyists are busy on Capitol Hill, too.
And, although Microsoft’s name isn’t associated with FairSearch.org, it is in contact with the coalition and is encouraging other travel companies to join the group.
Of course, it may not be in Microsoft’s or FairSearch.org’s interests to show an overt association between the two since the coalition’s heartfelt concerns about Google’s sway over travel advertising and airfare search might otherwise be seen by governmental regulators merely as another Microsoft-Google squabble.
But, some eyes were raised by the fact that The Glover Park Group, a well-connected Washington, D.C., strategic communications firm, is handling FairSearch.org’s public policy and coalition-building efforts.
The Glover Park Group handled Microsoft’s public policy activities in Washington, D.C., for several years, but Microsoft ceased retaining Glover Park this year for its D.C. initiatives and switched to Burson-Marsteller.
The same person, Ben Hammer, who handles Glover Park communications for FairSearch.org, played a similar Glover Park public policy role on Microsoft’s behalf for several years and was doing so as late as February 18, 2010 in connection with the Microsoft-Yahoo search alliance.
There are other ties between Microsoft and The Glover Park Group.
In July 2009, Jack Krumholtz joined Glover Park as a managing director in its government relations unit. For 14 years preceding that appointment, Krumholtz managed Microsoft’s federal government affairs program.
In addition to having FairSearch.org itself as a client, Expedia, an initiator of the coalition, is a Glover Park Group client, as well.
In light of Expedia’s current and Microsoft’s past relationships with The Glover Park Group, it’s hardly surprising that FairSearch.org might turn for help to a powerful D.C. communications firm, one that hired former White House press secretary Dee Dee Myers in September as a managing director of public affairs.
FairSearch.org states that Microsoft does not finance any of the coalition’s activities, and that with big companies such as Expedia and Sabre behind it, FairSeach.org and its members certainly have ample resources to fund the coalition’s efforts on their own.
The coalition also states that only FairSearch.org members make the group’s decisions.
Still, some of Microsoft’s interests indeed are in lockstep with the coalition’s.
However, in addition to Microsoft’s worries about how the Google-ITA acquisition would impact Bing Travel (formerly Farecast) and travel advertising, Microsoft has concerns about how the merger would render a powerful Google more powerful and impact Microsoft’s overall competition with Google in search.
As one travel industry pundit put it, “Expedia is probably less fervent in its opposition [to the ITA acquisition] than is Microsoft.”
In other words, Microsoft has more at stake than Expedia does.
Despite Microsoft’s message about FairSearch.org that it is merely monitoring developments, Microsoft clearly is not sitting on the sidelines in this whole Google-ITA thing.
Dennis Schaal was North American editor for Tnooz.