Wow. Things are really getting interesting. I’ve been talking for a while now about the convergence of search & travel, search & local, search & mobile/location based services. This is just another proof point (a $700M proof point). It doesn’t really affect Goby directly – we really haven’t been playing in the airfare space, we decided a long time ago to leave that to people who already do it well. The biggest potential losers in this deal are the metasearch players and online travel agencies – Kayak, Expedia, Travelocity and Orbitz, because Google can now build a user experience for flight search that dis-intermediates those companies and connects users directly to airlines for purchasing.

There’s also an interesting tension with many travel advertisers – Google receives billions of dollars in travel advertising revenue, but increasingly travel companies are viewing Google as competition (through things like Google Places pages and Google City Tours), and might take their ad $ elsewhere. The other interesting potential loser is Microsoft, for two reasons. First, Bing Travel is a great differentiator for Bing, and now Google has said they will build a competitor, where previously they had none. Second, Bing Travel (an enhanced and re-branded version of Farecast), was powered by ITA – it will be interesting to see how long that lasts!

Interesting times indeed. As airfares become more and more of a pure commodity, at Goby we’re thinking the action in the industry will turn to finding experiences – the real reason people travel. And Goby is perfectly positioned for that.

(btw – in addition to the obvious, Google is a winner in that they get a huge pool of deep engineering talent, and vertical expertise in the travel industry. They also pick up an interesting and not well publicized asset of ITA, the Needle project).

There’s a convergence coming, between the worlds of search, travel, local, and social. It used to be that if you were traveling, you used a guidebook and map and talked to the concierge, then you graduated to TripAdvisor and Expedia (and if you were adventurous, Kayak). People’s use of search engines tended not to intersect with their travel planning. In recent years of course Google has become a de facto part of the travel planning experience – although by no means a perfect one. And some search engines have introduced travel products (notably Bing Travel). And for planning your weekend, search engines have historically not been of much use at all – they don’t understand the concept of time or location very well (“this weekend” is just a few keywords to them), and don’t understand your task (when I search for beaches on Cape Cod, why do I get back results for restaurants with the word “beach” in them?). Robert Scoble has some thoughts on this subject, here. Google appears to be moving in this direction, with their rumored acquisition of ITA, which powers many airfare metasearch sites including Kayak. Their abortive attempt to acquire Yelp shows how search & local are converging as well.

But there’s a new game in town – social/local gaming, in particular with things like Foursquare and Gowalla, that combine social gaming with local-search-like results, allowing people to broadcast where they are and what they’re doing. There’s an evolving “stack” of technologies, including location databases and engagement tools, nicely summarized by Chris Dixon. (I disagree with his assertion that location databases will become commoditized – the information is too hard to come by, and companies like InfoUSA make hundreds of millions in revenue providing this kind of data. Not to mention the startups like SimpleGeo and Locationary and for that matter Goby, that are tackling the problem, but I digress).

This kind of engagement is going to have a profound impact on how people plan travel and figure out their weekends. DeepDish Creative (http://deepdishcreative.com/wordpress/2010/02/foursquare-for-tourism/) is talking about how destination marketing organizations can leverage these tools to promote their destination. But I see two problems with this generation of tools as they apply to this problem:

1. They are after-the-fact. I tend to engage with Foursquare after I’m already AT someplace – Foursquare isn’t really involved in my decision process, it simply records what I’ve already decided. As a result, it has limited use (not no use, just limited use) in making decisions.
2. These tools only recognize a limited set of entities, primarily businesses (in fact, primarily restaurants). It’s hard to check in at a U2 concert, because it’s an event, and it’s hard to check in at the Grand Canyon, because it’s not really an entity, it’s a generalized (and off-the-beaten-track) place. God help you if you want to check-in on a hiking trail!

Addressing those last two elements would create a resource that will not only appeal to my vanity & let me broadcast what I’m doing, but more importantly help me decide.

The key need here is a semantically meaningful database of things, to key all your features off of, and search tool to find & organize them – not just a pile of URLs. The system needs to know that Yo La Tengo is a band playing at the Fillmore on the 23rd of April, with a date and a location – not just a pile of keywords without any meaning. Any system like this needs to cover hotels and restaurants as well as non-business entities like hiking trails or concerts, and once you leave hotels/restaurants, this information is hard to come by. Once you have the database of entities, it is straightforward to build a platform for people to engage with their networks, in the context of that content. Once you have a strongly categorized, rich database of things to do, and a strong network of people telling you what they are interested in, you can provide compelling recommendations as well as support discovery. And, strangely enough 8), that’s where we’re headed with Goby – we plan to be right at the intersection of this convergence.