business case: google & ita - kom · kom – multimedia communications lab 3 google’s goal...
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Google.ITA.Buisness.Case.ppt
KOM - Multimedia Communications LabProf. Dr.-Ing. Ralf Steinmetz (Director)
Dept. of Electrical Engineering and Information TechnologyDept. of Computer Science (adjunct Professor)
TUD – Technische Universität DarmstadtRundeturmstr. 10, D-64283 Darmstadt, Germany
Tel.+49 6151 166150, Fax. +49 6151 166152www.KOM.tu-darmstadt.de
Presented by:Minh Hoang NguyenJohannes WowraMousie Fasil
30. Mai 2010
Business Case:Google & ITA
Technologie- und Marketing-Management in IT-/TIMES-Märkten
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Content
Presentation of Google Presentation of ITA Software Business Case for Google Conclusion
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Google’s Goal
“Our mission is to organize the world’s information and make ituniversally accessible and useful. We believe that the most
effective, and ultimately the most profitable, way to accomplish ourmission is to put the needs of our users first.“
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Google’s market stand
Revenues: 23.650.563 $ Total costs and expenses: 15.338.377 $ Income of operations: 8.312.186 $
97% of the profit come from advertisements
Until today Google took over 70 companies Most of them are integrated in to the Google network Some of them are left untouched e.g. YouTube
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Google’s Competitors
Every company which provides web users with information andrelevant advertising E.g. Yahoo! Inc. or Bing
Also vertical search engines and eCommerce sites E.g. WebMD, Kayak, Monster.com, Amazon, eBay, etc...
Social networks Mobile Applications Providers of online products and services
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Content
Presentation of Google Presentation of ITA Software Business Case for Google‘s Conclusion
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Founded in 1996 in Cambridge Develops software for the travel and airline industries Growth in 2008 was 175% Top 10 in Most Innovative Transportation Companies in 2010 (FastCompany)
Revenues
ITA Software Inc.
2003 $17.0 million
2004 $28.1 million
2006 $51.4 million
2007 $77.6 million
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ITA‘s Software
QPX Management System for airfare pricing and shopping
RES Passenger reservation management system
IBE Internet Booking Engine
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ITA‘s Customers
Airline Customers
Travel Distribution Customers
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Content
Presentation of Google Presentation of ITA Software Business Case for Google Conclusion
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Business Case for Google
Business purpose Acquisition of ITA Integration of ITA into Google Network New Platform for Flight comparison
Classification in TIMES-Market ITA & Google both in information sector But Google covers also Telecommunication (Android, Google Voice, Gmail) Media(YouTube, Google News) Entertainment(YouTube,Google Video, Google TV, Android)
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Business Case for Google
Market-Development $88.4 billion in U.S. online travel Sabre $2.9 billion (2008)
Opportunities in the Market Online travel agencies focus on the U.S. market 65 % of online airline bookings goes through ITA Software
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Business Case for Google
Additional Requirements & Resources None, since Google is experienced in software integration Also ITA Software is developed for easy system integration
Available Resources Google is leader in the online search market
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Business Case for Google
Market position New in vertical search with respect to online flight booking
SWOT-Analysis Strength: High experience in integration of companies into Google Network Weakness: New in the market Opportunities: Domination over Kayak, Bing, etc... Threads: ITA competitors, e.g. Travelport
Compensation against risk factors If Acquisition does not lead to ROI Termination of Project
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Content
Presentation of Google Presentation of ITA Software Business Case for Google Conclusion
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Conclusion
Google cannot provide a full functioning Online-travel agency More competence are needed for that Goal
1 Billion investment into ITA is connected with high risk Admob costs 750m $ but is more important
Profit from the market is not predictable Directed advertisement leads to higher ad income
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References
http://google.client.shareholder.com/investorkit.cfmhttp://www.google.com/finance?cid=9538830http://search.sys-con.com/node/1348892http://www.glgroup.com/News/Travel-Game-Changer---What-does-Googles-potential-acquisition-of-ITA-mean--
47949.htmlhttp://news.magnus.de/business-medien/artikel/bericht-google-will-anbieter-von-reise-software-ita-
uebernehmen.htmlhttp://www.traveltechnology.com/2010/04/google-and-ita-software/http://en.wikipedia.org/wiki/List_of_acquisitions_by_Google
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Additonal Informations
http://www.faz.net/s/Rub36B71B0E8E5C46E9AFBAF4B7B12FC9C5/Doc~EC976D79B436642C1ABE7658338A7E33E~ATpl~Ecommon~Scontent.html
http://www.travolution.co.uk/articles/2010/04/23/3443/opinion-what-would-google-do-with-ita-software.html