Even though it could take a while for Google to integrate & roll-out a travel search product in India, this is significant for the Indian players here as well - Cleartrip, MakeMyTrip, and Yatra.
How could this possibly affect the Indian OTAs?
Meta-search or something else?It's almost certain that Google will end up making a meta-search of sorts. What is debatable is whether the user experience will be the familiar travel search form (Bing Travel, Cleartrip, MakeMyTrip, etc.) or the regular Google "OneBox". From what they've been saying in their Google-ITA microsite & the recent blog post it seems that they've almost made up their minds to go down the OneBox route:
How cool would it be if you could type "flights to somewhere sunny for under $500 in May" into Google and get not just a set of links but also flight times, fares and a link to sites where you can actually buy tickets quickly and easily? Well that's exactly why we announced our intention to buy ITA Software[...]
Keywords, keywords, keywordsThe significance Google's meta-search product will lie in the keywords that they will "target". "Targeting" could be of two kinds.
Firstly, for search queries where the user's travel intent is narrow, eg. "mumbai delhi flights" OR "flights to delhi". In this case it's certain that Google will end up showing a typical search results page - with flight times + fares + links-outs to airlines/OTA websites where the user can book that particular fare (Take a look at the video above - they have have a rough scribble of the search results page). There could be secondary fields shown to the user to select his/her travel dates. Google has already started experimenting with such date fields in the US.
Since these kind of queries currently make up less than 5% of Google India's air travel search volume they pose little threat to the OTAs.  If Google insists on deep-linking to the booking pages of participating advertisers, at most it could reduce the OTAs to mere booking engines for 5% of their traffic and would put Google in control of the primary search experience. (This is pretty much what TripAdvisor is trying to do with the hotel segment through their "Check Rates" features).
Secondly, for search queries where the user's travel intent is very broad. These searches currently make up 90-95% of Google India's air travel search volume. In this case it's unclear what Google's strategy would be and this is where the real threat for the OTA segment lies. What could be the possible approaches?
- Google uses it's AdWords platform for placing in-house ads. For each broad travel query it takes the user to a page/microsite simply educating the user about the new search feature.
- It could very well go one step further and offer fields to narrow down broad travel queries, which would then lead into the meta-search results. For example, searching for "flight schedule" could throw up text fields (at the very top of the search results page) asking for origin/destination city or airline name.
Google could choose to crank-up it's marketing engine - employ AdWords, Google Display Network, & offline advertising (which it has in the past). This could result in significant increase in volume of targeted/narrow travel searches happening on Google itself with OTAs/airlines being used purely for transaction fulfillment. (Hell would break loose if they started targeting branded searches for pushing their new travel product. Not sure if they'd do this to their advertisers.)
Non-GDS/LCC Content?One dampener in Google's plans for Indian travel would be access to LCC content (non-GDS content, to be specific). I'm not sure what percentage of air travel in US is through LCCs, but in India it's more than 50% of the market. If they don't have SpiceJet, Indigo, GoAir, JetLite, etc. they'll be irrelevant.
- Google will require LCC/non-GDS content to be relevant in the Indian market. With the ITA acquisition this has not yet happened. However, it would be very easy for them to get access to LCC content directly through airlines.
- If Google sticks to making the "search experience better" for narrow/targeted travel searches, it may not impact the OTA segment much (since such search queries contribute to less than 5% of the search volume)
- However, if Google starts going after broad travel searches, it could impact the OTAs in the long run, especially if Google puts it's marketing dollars behind it.
- Lastly, if Google starts targeting the core OTA territory - branded keywords - it could end up hurting the entire eco-system (and invite quite a few lawsuits in the process).
One thing is certain - in the long run this will definitely kill the travel affiliate market which thrives off the narrow/targeted travel searches & contributes a lot to search-engine spam.
 A broad/inexact but directionally correct break-up of air travel searches is given below:
- Branded searches: ~80% This includes keywords like: Cleartrip, Yatra, MakeMyTrip, Indigo airlines, Air India, Cleartrip flights, Thai airways, etc.
- Generic air travel/flight related searches: ~10% This includes keywords like: cheap flights, cheap air tickets, flight booking, flight schedules, etc.
- Route searches: <5% This includes search phrases like: Mumbai Delhi flights, flights to Delhi, Mumbai Bangkok flights, flights to Bangkok, etc.
- Others: 5%