The US Justice Department gave its stamp of approval to Google’s $700 million purchase of flight data company ITA software but with certain conditions.

One of the conditions laid down by the department’s Anti-Trust Division is for Google to develop and license ITA’s travel software to other firms. Travel sites like Expedia, Kayak, and Travelocity, attempted to block the purchase on grounds that Google could have monopoly of the lucrative online travel sector and bring about higher prices.

ITA, a 500-strong company established in 1996 by computer scientists from the Massachusetts Institute of Technology, specializes in organizing airline data, which includes flight times, availability, and cost. Its software is utilized by various American airline companies as well as major online travel sites such as Hotwire and Trip Advisor, Kayak, Orbit, and Microsoft’s Bing.

Under the new deal, Google would allow ITA consumers to extend their contracts into 2016 and allow new customers to license its QPX software based on “fair, reasonable and non-discriminatory terms” until 2016. Likewise, the conditions requires the search engine company to offer ITA’s upcoming InstaSearch products to other travel sites.

In addition, Google is not allowed to enter agreements with airlines that would minimize sharing of seats and booking information with competitors. The conditions set forth by the Justice Department calls for the building of a “firewall” to keep it from getting access to the proprietary software of its competitors running on ITA servers.

According to Jeff Huber, Senior Vice President of Google, welcomed the approval of the deal and said that integrating ITA’s experience with their technology will allow them to come up with new flight search tools for their users. FairSearch.org, a coalition of companies blocking the acquisition including Microsoft, lauded the setting of conditions.

Consumer Watchdog, another group against the acquisition, expressed fears that even with the imposed conditions, Google will still have ultimate control of the travel search industry which could result to increased ticket prices. However, Google countered by saying that it does not intend to sell airline tickets or set airfare costs.

Google has been subjected to government scrutiny as it has become a dominant player in the online search industry but the ITA deal would make it the first time that the company would be subjected to anti-trust supervision. Just last week, it reached a compromise with the US Federal Trade Commission over Google Buzz, the company’s social networking tool launched in 2010, which triggered complaints here and there.

The FTC regulation called for Google to implement an extensive privacy program and will be subjected to separate privacy audits every couple of years for the next two decades. In February, the company suffered a setback when a US judge rejected a copyright settlement entered by the search engine giant with authors and publishers regarding its plan to set up a vast digital library and online bookstore.

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