Google Inc. plans to buy travel technology company ITA Software Inc. in a $700 million deal that would enable the Internet search leader to steer more of the airline reservations booked on the Web.

The all-cash acquisition announced Thursday signals Google's intention to challenge flight-comparison services that are ITA customers, including Kayak, FareCompare, Hotwire and Microsoft Corp.'s Bing Travel. The deal is likely to face a rigorous review by federal antitrust regulators.

ITA Software, a 500-employee company created in 1996 by computer scientists at the Massachusetts Institute of Technology, sells technology that helps run the reservation systems of many airlines, including American, Southwest, Alaska and Continental. Its software also powers the tools that other travel websites use to track air fares.

The widespread reliance on ITA's technology means federal regulators are likely to spend six months to a year trying to determine whether the acquisition will give Google an unfair advantage in the rapidly growing online travel market, said Ted Henneberry, an antitrust lawyer in Washington for Orrick, Herrington & Sutcliffe.

Schmidt declined to predict when the deal might close, but said he expected Google would ultimately win approval after regulators take a fair amount of time to review the deal.

Online travel industry analyst Henry Harteveldt predicted the acquisition will be cleared because ITA Software isn't a direct competitor to Google.

If it clears the antitrust hurdle, Google will be picking up expertise that will help improve the quality of its search results in one of electronic commerce's biggest markets. Consumers and small-business travellers in the U.S. will spend about $45 billion on airline tickets booked online this year, and that figure is expected to rise to $59 billion by 2014, Harteveldt said.

And with thousands of engineers at its disposal, Google conceivably could build upon ITA's success in the airline industry to expand into hotel, rental car and cruise reservations.

Google is counting on ITA's expertise to improve the quality of its search results when people are looking to make airline reservations.

The biggest winners in this deal would be consumers and Google will be able to drive more traffic to airlines and travel agencies such as Orbitz and Expedia. Google would profit from ITA's technology by selling more ads alongside the flight data.

Bing has been picking up more traffic with features that help people figure out whether the prices of airline tickets are likely to increase or decrease. Like other search engines specializing in travel, Bing checks multiple sites at once for the best deals and sends users to those sites to book there.

Travel websites generally earn fees for sending traffic to flight booking sites, but Google appears more interested in improving its travel search service so that it can retain users and sell more ads.

Google intends to honour all of ITA's existing contracts if the acquisition is approved. It's unclear whether Google would still want to work with some of its rivals after the contracts expire.

This isn't the first Google acquisition to come under intense scrutiny. Regulators took nearly a year to approve the company's $3.2 billion purchase of online ad service DoubleClick in 2008 and six months to OK its recent $750 million takeover of mobile ad service AdMob.

On June 29 2010, Apple sold more than 1.7 million units of its new iPhone model in the first three days, making it the most successful product launch in the company's history in terms of sales.

The iPhone 4 went on sale Thursday in the U.S., Britain, France, Germany and Japan. High demand for the model caused shortages. It is a familiar story that has been mirrored by the iPhone 3GS launch and the iPad launch. People are crazy for these Apple products.

The iPhone 4 goes on sale in Canada in late July. So no shortage yet in Canada. Although, given the iPad shortage, we fully expect there to be an iPhone 4 shortage in Canada. The big issue is the availability of the new super-high-resolution "Retina" displays. The white version is also delayed due to some kind of bizarre manufacturing challenge. Or perhaps just an excuse from Apple to ship a single colour at launch time.

Apple is marketing this launch as "the most successful product launch in Apple's history" (Steve Jobs, Apple's CEO). And similar to Clubs that make patrons wait outside in lines to create hype there is a shortage of device. Apple apologized "to those customers who were turned away because we did not have enough supply" (classic Apple marketing tactics).

Apple sold more than 1 million units in the first three days when it launched last year's model, the 3GS. Canada, Italy, Spain and Switzerland were then among the launch countries, but Japan was not.

Apart from the sharper screen, the iPhone 4 features a slimmer body and faster processor than the previous model, among other changes. The phone also has the new A4 chip inside, which adds power, enhanced video, and better battery life. Add a gyroscope, which they did, and this device can orbit the planet.

As expected, shares of the Cupertino, Calif.-based Apple rose significantly. Apple just keeps climbing. Success after success. Truly an outstanding year for Apple. Too bad their Apple TV product isn't doing so well. Google TV is poised to compete with Apple with Android and Google TV. It is going to be an interesting Google-Apple battle in the years ahead. Stay tuned for the drama to unfold...

Intel used the Computex conference--which kicked off today in Taiwan--to announce new chips aimed specifically at tablets, as well as dual- core Atom processors for more powerful netbook computers. Intel's battle for a share of the tablet market, and efforts to defend its position for netbooks will help drive innovation and keep pricing competitive. The secondary goal is to compete head-to-head with the iPad.

Intel has long been the symbiotic beneficiary of the success of PC's.Even Apple eventually adopted the Intel hardware architecture for its Mac OS X systems.

In an era of rapidly increasing mobility, though, Intel finds itself in the same boat as Microsoft--its de facto dominance challenged and faced with potential irrelevance. Both Microsoft and Intel are fending off competitors in their core markets, while also struggling to establish a presence on smaller, mobile platforms.

Smartphones and tablets are changing the way people compute. A survey of business professionals found that nearly 40 percent use their smartphone to conduct most business, and 8 out of 10 would give up coffee before parting with their smartphone.

The Apple iPad has sold more than three million units in only two months--and it is just one example of next-generation tablets which also include devices like the upcoming HP Hurricane, and the Dell Streak. Many more are also not he horizon.

What smartphones and tablets have in common is that they are almost universally built using ARM processor technology rather than Intel. ARM is now competing directly with Intel.

The tablet processor architecture unveiled by Intel at Computex--codenamed Oak Trail--is a system on a chip (SoC) that promises to consume 50 percent less power while also enabling full HD video playback. The Oak Trail processors aren't expected in production hardware until early 2011, though--at which point it is expected that there will about 8 million iPads already sold. A little late.

One device that is generating a lot of excitement at Computex may represent a ray of hope for the Wintel platform in the age of mobility. Asus revealed its Eee Tablet--built on an Intel CULV Core 2 Duo processor, and running Windows 7, while still boasting 10 hour battery life in a 10 or 12 inch tablet form factor. The estimated availability of the Eee Tablet is unknown. But in the end this is a Windows machine shrunk into a Tablet rather than a device that innovates significantly, like the iPad.

One aspect of the iPad that drives its success is the ability to capitalize on the continuity of experience and existing investment in apps from the iPhone. Tablets like the Asus Eee can turn that model around, though, allowing users to experience a consistent interface and use the same software on the tablet as they are used to from their Windows 7 desktops. The issue with this approach is, why would you want to run a desktop OS in your daily tablet experience. Wouldn't you want a better and customize tablet experience?

It remains to be seen if Intel or Microsoft can be as dominant a force in tablets or smartphones as they have been in servers and desktops. One thing is for sure, though--the fact that they are fighting for market share will be better for business professionals and consumers because it creates competition which will force all parties to be innovative in their design and technology.