Google on Thursday announced a definitive agreement to acquire a software company whose platform organizes flight information for the online travel industry. The search giant will pick up ITA Software for $700 million in an all-cash deal.

Google on Thursday announced a definitive agreement to acquire a software company whose platform organizes flight information for the online travel industry. The search giant will pick up ITA Software for $700 million in an all-cash deal.

ITA was founded in 1996 by a team of MIT computer scientists. The company has developed algorithms that underpin a customizable flight-data organization tool that airlines and online travel agencies, including American Airlines, Continental Airlines, Hotwire and Orbitz, use to power their reservations.

Google smells revenue. The online travel industry generated $124.4 billion in 2009, according to eMarketer, and that figure is set to grow even after doubling in the last four years.

"ITA's very talented team has created an impressive product to organize flight information," Google CEO Eric Schmidt said. "Their technology opens exciting possibilities for us to create new ways for users to more easily find flight information online, and we're looking forward to welcoming them to Google."

Room for Google Innovation

Google's research shows that nearly half of all airline tickets are sold online today. But Google's research also found that many people are frustrated trying to find the best deal on flights because pricing and availability constantly change. Marissa Mayer, vice president of search products and user experience at Google, thinks there is room for more competition and greater innovation in the online travel sector.

"Google has already come up with new ways to organize hard-to-find information like images, newspaper archives, scholarly papers, books and geographic data," Mayer said. "Once we've completed our acquisition of ITA, we'll work on creating new flight search tools that will make it easier for you to search for flights, compare flight options and prices, and get you quickly to a site where you can buy your ticket."

Google said the ITA acquisition will benefit passengers, airlines and online travel agencies by making it easier for users to comparison shop for flights and airfares and by driving more potential customers to airlines' and online travel agencies' web sites.

Will the Feds Approve?

Greg Sterling, principal analyst at Sterling Market Intelligence, said the ITA acquisition gives Google all sorts of interesting capabilities around airfare and travel search. He's also sure that whatever Google has planned is going to be broader than just airline tickets. The immediate question is whether Google will get government approval to close the acquisition.

"There are the customary regulatory approvals to get through, which could take months -- as we saw in the case of AdMob. Google has already thought through all the antitrust angles and arguments and is trying to address them preemptively in public comments and PR," Sterling said. "In some ways this may turn out to be a more challenging acquisition than AdMob, although it perhaps presents less of a technical-legal challenge in some ways."

To Sterling's point, Google stressed that it won't be setting airfare prices and has no plans to sell airline tickets to consumers. Noteworthy is the fact that Bing uses ITA software for its travel information. But Google said it will honor all existing agreements. Google also noted that since it doesn't currently compete against ITA Software, the deal will not change existing market shares.

ATHENS, Greece – Images of flaming buildings and riots in Athens during last week"s protests in debt-ridden Greece have taken an early toll on the country"s vital tourism industry, hotel owners said Thursday.

ATHENS, Greece – Images of flaming buildings and riots in Athens during last week"s protests in debt-ridden Greece have taken an early toll on the country"s vital tourism industry, hotel owners said Thursday.

About 20,000 overnight stays at hotels in Athens and nearby resorts have been canceled since May 5 riots that left three people dead, according to the local hoteliers" association.

The setback reveals persisting challenges for Greece"s battered economy, despite a (EURO)110 billion ($138 billion) international rescue program that staved off bankruptcy. A painful austerity program taken to secure the aid is expected to keep the economy in recession until 2012, while unemployment has hit new records.

Greece has little heavy industry and a large trade deficit. But tourism accounts for an estimated 17 percent of annual economic output and one in five jobs, and a significant drop could cost more jobs and slow the country"s way out of recession.

"There is clearly a significant fall in our clientele and the trend for cancellations is rising," Yiannis Retsos, head of the Athens and Attica Hoteliers" Association, told The Associated Press.

"We have clients calling us up to ask whether there is still a revolt going on," he said. "The footage of the riots and the burnt bank has been played repeatedly for days on international media. Your average American thinks that Athens is continuously burning."

Violent protests broke out after the government announced harsh austerity measures — including salary and pension cuts — that have deepened Greece"s recession but were needed to secure the rescue loans.

About 100,000 people took part in the May 5 protest during a general strike, when three bank employees died after becoming trapped in a burning building torched by rioters. Extensive clashes saw 15 civilians and 41 police injured, in what the government called "a black day for democracy." Unions have called a new general strike for May 20.

The hoteliers" association said the cancellation data concerned just 68 of the area"s 450 hotels, and included group and conference bookings.

"The most worrying thing is that the rate of new bookings has frozen, during a couple of months that are traditionally the best for (tourism) in the greater Athens region," it said in a statement. "There is also a significant drop in new bookings throughout Greece, which is due to international reaction as long as the situation in our country is seen as uncertain."

An estimated 14.9 million people visited the Mediterranean country in 2009, drawn by its perennial lure of sun, beaches and ancient sites. That was still about 1 million fewer than in 2008, and 1.2 million down from 2007.

"We want people to understand that right now in these times of hardship, when tourism must serve as a significant source of economic growth, the situation must change because this does not just affect Athens but also the entire country," Retsos said.

He also urged the government to pay its advertising debts to foreign media, which he said influenced their coverage of events.

The labor unrest has also hit cruise tourism. Last month, communist unionists stopped several hundred mostly Spanish tourists from boarding a cruise ship, in a dispute over labor reforms. The ship owners threatened to stop cruises to Greece, in a move the country"s association of tourism enterprises said could cost 400 jobs and (EURO)10 million ($12.6 million) in revenues.

Faced with the second highest budget deficit and public debt in the 27-member European Union, the governing Socialists have pledged to save (EURO)30 billion ($37.76 billion) over the next three years by cutting pensions and civil service pay, reforming the generous social security system and fighting tax evasion.

The finance ministry on Thursday said it had found more than a third of 150 doctors investigated in an expensive part of Athens had cheated tax authorities. It said the doctors, who declared annual income of as low as (EURO)300 ($377), could have their practices closed down.

The ministry also named 11 doctors who it said were fined a total of more than (EURO)4 million ($5.03 million) for alleged tax violations.

Meanwhile, Greece"s Statistical Authority said Thursday that unemployment shot up to a new five-year high of 12.1 percent in February. In comparison, the joblessness rate was 11.3 percent in January and 9.1 percent in February 2009.

A total of 605,277 people were unemployed in February 2010, around 38,000 more than in January.

DENVER – Colorado mountain towns whose lodging tax collections have suffered along with the travel industry are trying to make sure homeowners who rent out rooms pay their fare share to the government.

DENVER – Colorado mountain towns whose lodging tax collections have suffered along with the travel industry are trying to make sure homeowners who rent out rooms pay their fare share to the government.

"They are essentially hotels, and they need to be paying taxes like hotels," said Telluride Town Manager Frank Bell.

One of Bell"s employees trolls vacation rental Web sites like and to find private renters violating tax laws or zoning restrictions that bar nightly rentals.

"I think it would be conservative to say there are hundreds of thousands of dollars being missed out in Colorado alone," said Joyce Burford, executive director of the Colorado Association of Ski Towns.

The association"s board of directors recently decided to hire an expert to seek out private renters in resort towns and make sure they are following local licensing and tax rules. The expert also will develop a uniform strategy for towns to track private rentals and enforce local laws.

Telluride is watching about 400 private rental homes. In Steamboat Springs, all but about 30 of 450 private renters as of late last year had begun paying taxes, and about 100 of 600 private rentals counted in Breckenridge were not licensed or paying taxes, The Denver Post reported.

Breckenridge Town Manager Tim Gagen said many of the violators in his town are out-of-state owners who don"t realize they need to be licensed and pay taxes.

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Information from: The Denver Post,

MIAMI – The cruise industry is rebounding, but not for the companies who build the increasingly elaborate ships.

MIAMI – The cruise industry is rebounding, but not for the companies who build the increasingly elaborate ships.

Executives from the major European shipyards say they"re not getting enough orders to keep busy and profitable. Though cruise bookings and prices are up, a flood of new ships is crowding the market, and operators have shown little willingness to buy more ships.

Only one new order was placed in 2009, and only four so far in 2010. That"s down from 21 in 2006, before the economic downturn began in December 2007.

"The cruise ship-building industry has slower reaction time and suffers from deeper distress in comparison with cruise lines," said Corrado Antonini, chairman of the Italian state-owned Fincantieri Cantieri Navali Italiani S.p.A.

If things don"t improve, shipbuilding officials and observers said at an industry conference this week, the yards could lose key skilled workers, suppliers and subcontractors — if they can stay afloat at all. And that means trouble when operators do finally want new ships, with ever-increasing amenities like skating rinks, bowling alleys and climbing walls.

Fincantieri is one of just three companies in the world that dominate the specialty niche of cruise ship-building. Antonini warned that if new orders don"t pick up soon, cruise ships will become more expensive to build and less efficiently made.

"The shipbuilding industry has an intrinsic inflexibility deriving from plant assets and specialized skilled resources, which cannot be simply freezed, moved or fired," Antonini said.

Fincantieri is the only of the three major builders with work on the books past 2012 — and they didn"t have it until Carnival ordered two new ships last month. That"s an uncomfortable prospect in an industry where a single order requires years of labor and planning, plus more than 10,000-gross tons of steel and other material.

The other major builders are privately owned Meyer Werft GmbH, based in Papenburg, Germany, and STX Europe AS, a unit of South Korean conglomerate STX Corp. that operates cruise ship yards in France and Finland.

The head of a European ship brokerage says the builders — which also make other types of ships — have become too dependent on the cruise industry, which offered steadily enticing growth of 7 percent a year. It"s hard for the builders to adapt in downturns, and the trend toward bigger vessels means fewer new ships will be needed, said Jean-Bernard Raoust, president of Barry Rogliano Salles.

A boost for the shipyards could come from the European Union, which is expected to start ordering a fleet of new, environmentally friendly ferries, the builders say. Existing vessels are aging, particularly in Mediterranean areas like Greece and Italy.

Meyer Werft spokesman Peter Hackmann said the company isn"t ready to panic. They"re working on seven big cruise ships for three different clients, plus two gas tankers, he said.

"It would be better if we could have orders for 2013, 2014 — it is not as easy as in former years, but we are quite confident," Hackmann said. "We will have years in former times where we would love to have seven ships on order."

NEW YORK – While some beach destinations in the Gulf region have experienced visitor cancellations related to the oil spill, there"s one sector of the travel industry that has not been affected yet and that"s the cruise industry.

NEW YORK – While some beach destinations in the Gulf region have experienced visitor cancellations related to the oil spill, there"s one sector of the travel industry that has not been affected yet and that"s the cruise industry.

"The cruise impact so far has been nil," said Melissa Paloti, managing editor at . The website has been checking in daily with all the cruise lines running ships in the region.

Lanie Fagan, a spokeswoman for Cruise Lines International Association, an industry group representing 97 percent of cruise capacity in North America, said CLIA"s member lines "have had no ships requiring deviations or changes to itineraries due to the oil spill."

Carnival Cruise Lines, which sails ships from New Orleans and Mobile, Ala., said in a statement that its captains may make "slight course alterations as necessary to avoid the most heavily impacted spill areas." The company is also inspecting ship hulls for oil residue. But the company said it was "not anticipating any interruptions to our normal cruise schedules."

SAN JUAN, Puerto Rico – The U.S. Coast Guard is searching for a Royal Caribbean cruise ship worker who climbed over the ship"s railings as it traveled past Puerto Rico, officials said Thursday.

SAN JUAN, Puerto Rico – The U.S. Coast Guard is searching for a Royal Caribbean cruise ship worker who climbed over the ship"s railings as it traveled past Puerto Rico, officials said Thursday.

After crew members reported him missing on Wednesday night, officials reviewed the ship"s video cameras and saw the lowering himself over the side of the ship, spokeswoman Cynthia Martinez said.

The captain immediately turned the ship around, alerted the Coast Guard and headed toward the location where the man went overboard, she said.

Officials did not release the name of the 26-year-old man.

Coast Guard Spokesman Ricardo Castrodad says crews are looking for the man 138 miles (222 kilometers) north of the coastal town of Isabela in Puerto Rico.

The Explorer of the Seas was on a 10-day trip that left Bayonne, New Jersey on April 29 and is scheduled to arrive on Saturday.

LAS VEGAS – The online travel company Expedia Inc. said Friday it will add 130 new jobs in Las Vegas by the end of the month as the company continues to rebound from the recession.

LAS VEGAS – The online travel company Expedia Inc. said Friday it will add 130 new jobs in Las Vegas by the end of the month as the company continues to rebound from the recession.

Expedia said the new positions are mainly travel agents and support staff. The hiring will bring its Las Vegas operations up to 500 employees.

"This expansion means new jobs for 130 Nevadans and we are hopeful for further growth, which is always something to celebrate," Michael Reichartz, Expedia"s vice president for market management, said in a statement.

Expedia Inc. in April reported that an uptick in advertising revenue from its websites and a recovering travel industry helped lift its first-quarter profit 51 percent.

Shares rose 9 cents to close earlier at $20.97.

JUNEAU, Alaska – With a hulking ship in the background, Alaska Gov. Sean Parnell signed legislation lowering the state"s tax on cruise passengers in a move aimed at bringing more ships back to Alaska and settling an industry lawsuit over the fee.

JUNEAU, Alaska – With a hulking ship in the background, Alaska Gov. Sean Parnell signed legislation lowering the state"s tax on cruise passengers in a move aimed at bringing more ships back to Alaska and settling an industry lawsuit over the fee.

The Alaska Cruise Association has blamed the $46 head tax and the state regulatory climate, at least partially, for the loss of three ships — and an estimated 140,000 passengers — this season, though critics questioned how large a role it played, given the global economic woes and other factors, like changing travel trends.

The loss of travelers is expected to compound the financial hit taken last year by many small tourist-related businesses, like those along Juneau"s Franklin Street row, amid the slumping national economy.

"It"s a tough and challenging time," said Tanja Cadigan, a co-owner of Caribou Crossings.

Parnell signed the bill Thursday outside Cadigan"s art and jewelry store as a smattering of tourists, who had unwittingly stumbled upon the photo op, paused on the fringes — in their rain gear amid the gloom and fog — to watch.

During the legislative session, Cadigan made emotional pleas for a rollback, saying she considered a tax cut crucial to her livelihood. Business was down 15 percent last year, she said, and down another 10 percent early in the summer season upon which her livelihood relies.

Questions have been raised about whether $46 tax on a cruise that can cost $1,000 or more would really give tourists pause.

Wayne Cory, who recently disembarked from a cruise ship in Juneau with his wife, said he didn"t know there was a state head tax but that he couldn"t imagine it would change their decision to take a cruise.

"But I"m always in favor of less taxes," said the Las Vegas-area resident.

Nevertheless, Cadigan hugged Parnell on Thursday, even though immediate help wasn"t anticipated.

Tourism and industry officials called the reduction an important first step, and John Binkley, president of the Alaska Cruise Association, cautioned against expecting too much, too fast.

Cruise lines have already made their plans for next year. And while there are some bright spots — three lines have announced plans to bring in new ships — the lineup for 2012 won"t be finalized for months.

Binkley said the state will not only have to build back what it lost, but it must also compete with destinations that benefited from ships Alaska lost. A multimillion-dollar ad campaign to promote the industry, a cause for which the Legislature gave extra money, is seen as a key part of that endeavor.

With Parnell"s signature, the head tax will drop from $46 to $34.50, with deeper offsets for ships stopping in at least one of two popular ports, Juneau and Ketchikan. Voters had approved the tax in 2006, with supporters seeing it as a way to help cover the cost of infrastructure needed for large ships coming to port.

But the cruise association argued the tax is onerous and unconstitutional, and sued the state. The legislation signed Thursday addresses how infrastructure money is divvied among ports of call, winning over some early critics who didn"t want infrastructure to suffer.

It also calls for the cruise association to drop the suit.

The latter was a term agreed upon by the state and industry contingent upon the rollback becoming law. Another term of the agreement was for the state and each of the association"s nine member lines to work toward boosting deployments.

Parnell said he has made clear to executives that he expects more ships, adding that he sees the new deployment announcements as signs of a "tremendous shift in the investment climate."

NEW ORLEANS – Royal Caribbean International says it will homeport its liner Voyager of the Seas in New Orleans beginning in 2011.

NEW ORLEANS – Royal Caribbean International says it will homeport its liner Voyager of the Seas in New Orleans beginning in 2011.

Port officials said it would be the largest cruise ship ever based in the city. Voyager of the Seas is 1,020 feet long and can carry up to 3,838 passengers.

It will make 24 cruises to the Caribbean between November 2011 and April 2012. The line also has committed to the 2012-2013 winter season and will have three one-year options to continue calling at New Orleans.

The move follows earlier announcements that Norwegian Cruise Line would shift from seasonal cruises to year-round cruises from New Orleans starting in November 2010. In November 2009, Carnival Cruise Lines replaced the Carnival Fantasy with the much larger Carnival Triumph.