The proposed merger between Google and ITA Software, Inc. (ITA) offers antitrust enforcers the latest in a series of escalating challenges in which high technology markets seem to be straining the boundaries of antitrust analysis. Apart from the very difficult analysis, however, this transaction raises broader questions of competition policy concerning Google’s rapid growth as a one-of-a-kind firm. The deal might even have implications for the future of airline ticket distribution. In this white paper, the American Antitrust Institute (AAI) seeks to identify and explore both the narrow and broad competition issues that are raised by a Google/ITA combination.In the narrowest sense, acquiring ITA would put Google in the business of supplying a technology input that powers downstream products in a vertical online search market. That is, Google would own what many consider to be the premier technology that online travel agents, travel meta-search websites, and airline websites license from ITA to afford Internet users the ability to search real-time pricing and seat availability data in the course of shopping for airline tickets online. Neither Google nor ITA currently competes in the provision of this data to Internet users by “online travel search” firms, but together they seem to have such firms surrounded. Companies like Kayak, Orbitz and Hotwire, as well as airlines, rely heavily on Google to tell consumers where they can get airline pricing and availability data on the Internet, and they rely heavily on ITA to deliver the data itself.The Antitrust Division of the Department of Justice (DOJ or the Division) must therefore evaluate the potential competitive effects of a transaction that does not directly accomplish vertical integration in any assumed relevant product market or obviously eliminate actual (as opposed to potential) horizontal competition in any assumed relevant product market, but yet strategically positions a likely monopolist of a nearby and intimately related market to enter the online travel search market with significant competitive advantages. At bottom, the Division will simply have to determine whether the effect of the transaction may be substantially to lessen competition. Under the Clayton Act’s standard, which calls for the prevention of anticompetitive dangers in their incipiency, this determination will demand sound predictions within a complicated space. AAI believes that vertical merger standards as they have evolved over the last two decades, along with the potential competition doctrine as it is incorporated in the DOJ’s Revised Horizontal Merger Guidelines, are up to the task of steering a proper analysis. The Division should use these tools to explore the risk that Google may acquire market power in the online travel search market or the technology input market, along with the risk that Google’s control of ITA would lead to foreclosure or other exclusionary effects, whether directly or indirectly. The Division should also consider whether the transaction might have the effect of raising barriers to entry into the broader online search market, which Google already dominates.Looking beyond the present merger, one has to wonder about antitrust scrutiny for any future Google acquisitions – including vertical acquisitions that might otherwise appear benign in traditional commercial settings. Questions about the prospect that Google might leverage a broader search monopoly into dominance of distinct vertical search markets through acquisitions seem destined to crop up again. Such questions will persist if Google’s suspected online search monopoly is or is becoming entrenched, as will questions about how fairness and neutrality in something as complex and subjective – and necessarily lacking in transparency – as search engine algorithms can ever be monitored and effectively regulated.From our perspective, governmental efforts to protect against manipulation of algorithms by Google are not only likely to be ineffective, but they will necessarily raise First Amendment questions as the government participates in decisions about the prioritization of information reaching the public. Maintaining competitive markets for both general and niche search may be the only alternative, ultimately, to an unregulatable monopoly. It is therefore appropriate for the government to work within a public vision of longer-term developments and to place the present acquisition within such a context.