NB This post was republished on Tnooz on 15 Sep 2011.
Being located 17 hours ahead of Silicon Valley often has you lagging behind on the big news. On waking this morning at home in Melbourne, the inbox and Twitters were abuzz. Google had launched a flight search product.
As the “other” YC-funded travel search startup, people just wanted to be sure we’d heard the news. Most were just interested in our thoughts. At least one feared for our future.
Over at HackerNews, once you waded past the protracted debate over Google’s evilness, several commenters asserted with certainty that this would spell death for travel startups like Hipmunk. The news had one anonymous travel startup founder throwing himself out the proverbial window.
When Google first announced its intention to acquire ITA Software in July 2010, we at Adioso thought it was a huge deal that would materially influence our prospects. But today, on the day that Google has finally launched its flight search product to the world, we couldn’t be less fazed by it, and we think every other travel search startup should feel the same way.
Let’s try and cut through the hyperbole. What is Google Flight Search? It’s just a flight search tool, that is integrated the Google search engine. Nothing more, nothing less. It has some cool features, and no doubt it will have many more cool features in the future, some which may be truly disruptive to the travel industry.
But as a startup, to believe Google Flight Search destroys your own prospects is to believe that being Google is all it takes to own 100% of the travel search market. It is also to believe that once Google has taken ownership of the market, it will be the unassailable leader for any type of travel search, effectively for all of eternity.
I doubt those beliefs are correct.
One of the Y Combinator mantras is “Startups don’t get killed by competitors, they commit suicide”. In YC folklore, the only company ever to have been killed by a competitor was Kiko, a calendar app, that died shortly after Google Calendar launched .
You can see how that would would have happened. A calendar app is a relatively generic product, and being good enough and tightly integrated with Gmail might have been sufficient to effectively kill the rest of the market. For Kiko to have innovated enough to overcome Google’s natural advantage would probably have meant becoming something quite different from a simple calendar app. They could have done that, but they decided to do Justin.tv instead.
You don’t get anything much less generic than travel search. Well before the internet, there were endless different ways in which people planned and booked travel. And whilst the internet has spawned a handful of dominant players like Expedia, Priceline, Orbitz and Kayak, there are thousands of other online travel search and booking tools, many with very large, happy audiences.
The travel industry is one of the biggest of all the world’s industries. It’s hard to imagine an industry with a consumer-base as vast and diverse. Yet tastes and preferences in travel search tools aren’t just diverse accross geographic and demographic segments, but even within quite narrow ones.
As Y Combinator-backed travel search companies, Adioso and Hipmunk have a significant intersect between our initial target demographics: YC founders and fanboys if none else. Yet even among people in this rather homogeneous segment, you’ll get wildly differing views on which company has a better travel search product.
Some adore Hipmunk, some hate it. Some are excited by Adioso - its potential or its reality - and some don’t understand why anyone would ever want it. Some think we both suck and just carry on using Kayak. And some love each one at different times, depending on the type of travel and the certainty of their plans. So, even within the one brain, there’s often great diversity in tastes and requirements in travel search products, depending on the context.
It was discovering this that made me realise we didn’t need to worry too much about competition. Adioso was never a search tool to win largely-satisfied customers away from other established players. It was a product we built for ourselves, which then found an audience of people who agreed with our ideas on the way travel search should work. Similarly, Hipmunk is a search tool for people who agree with Adam and Steve about they way travel search should work. Some of those people will be the same, and some won’t. For both of us, our success relies on finding enough people who share our views. The beautiful thing about travel is that each of these niches can still be vast and lucrative.
When we heard about Hipmunk, we naively worried they’d copy our ideas and use our secrets to beat us in the race to win over the market for, well, I guess any new travel search product . Of course as soon as we saw their product we realised it was nothing like ours and was built to serve very different needs.
Now, if I ever worry that Hipmunk might move into our product space, I just remind myself that they’re far too busy just being Hipmunk to think about being Adioso. For every feature of ours they’d add, they’d become less of what they set out to be themselves.
And now I think the same about Google. Google is building the sort of travel search product that Google would build, and it will be liked by the sorts of people who will agree with Google on the way travel search should work. They’ll probably add features conceived by Adioso, Hipmunk and any number of other travel search companies.
But they can’t do everything. They can’t please all of the people all of the time. More so than in just about any other industry, they can’t do it in travel search.
I’m not underestimating how significant and disruptive this will be for the industry. And I’m not oblivious to the implications for those who depend on Google paid or organic search for traffic, or on ITA for airline data.
But in the scheme of things, these issues matter little for startups. Building a great travel search company is really hard, not because of anything that Google does, but because building a great company is really hard.
At Adioso, we’re just getting on with building a great company.
 According to Kiko team member Richard White, the real story is that they weren’t actually killed by Google Calendar, they committed suicide too. But I think it’s still fair to say Google killed (or would have killed) Kiko as a simple calendar product.
 We particularly felt this as Alexis and Steve are investors in Adioso and thus had access to inside knowledge of a lot of our insights and plans. In retrospect, we heavily overvalued our insights and plans.