Friday, December 08, 2006

"Worldspan+Travelport=Gal-World" - how a search term became a company


First it was a strange rumour. Then it was a search term here and there. Finally it became a mountain (well a small hill) of traffic to travel blogs such as yours truly, Travolution and Travel.Beat. Now it is reality - Travelport (Galileo) has acquired Worldspan.

Interesting points from the deal:
  • Cendant bought Orbitz in part because of the huge revenues that Galileo would gain from migrating Orbitz from Worlspan to Gal. Presumably part of the reason behind Galileo buying Worldspan is eliminating the litigation risk and migration cost that arose from that strategy - how serendipitous;
  • Worldspan itself has been in some financial trouble. This deal will not simply be a case of cutting costs. The Worldspan and Gal products will both have to be kept alive for some time. Reviving Worldspan will be a enormous integration task for Gal; and
  • There are lots of financial machinations behind the deal - an immediate recapitalisation of Worldspan and a $125mm loan to Worldspan. The item to keep a close eye on is the comment that
    The initial integration focus will be on consolidating technology and administrative operations resulting in near-term cost savings of approximately $50 million
    That is - a lot more head count to go.
But my favourite part of the deal is that it confirms that Google knows everything. There is no secrecy in M&A activity any more because the answers are all in Google's logs. If I can sit he with my tiny free tracking service and see that people with Worldspan and Travelport IP addresses are furiously typing in every combination of Worldspan and Travelport you can think of, can you imagine what could be gleamed from Google, Yahoo, MSN search logs by looking for combinations of company names.

Now comes the fun part - need to pick a new name for the combined company. "Worldport", "Travelspan", "Portspan", "Worldtravel"...all too corporate and boring. We need something fresh that speaks to generation Y - which is why I propose "Gal-World"....OK, maybe not...it probably wouldn't work too well typed in a search engine.

Thanks to Ed Silver who was first to forward the PR news to me.

UPDATE - e-tid are reporting that (registration required)
Worldspan will assume the Galileo name

1 comment:

Jay Campbell said...

Thanks so much for the reference to our newsletter, TheBeat.travel, but I must point out that it is not a blog. Not that there's anything wrong with blogs--in fact our company publishes two "slogs," or NewsLogs at management.travel and thetransnational.travel.

This post is not only self-promotional. If The Beat were a blog, more people would have been tipped to this news about Worldspan-Travelport way back on Nov. 14. But because it is not a publicly accessible blog, only the 4,500 readers whose 200 companies pay for a subscription to The Beat heard the deal was going down that early.

As such, I must say with all humility that for travel professionals, while it may have been "a strange rumour" at first, the information became a column before it hit the blogs. Then it was announced.

Fortunately or otherwise, Google does not (yet) "know everything."