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Google Inc. (Nasdaq: GOOG) entered a licensing agreement yesterday (Monday) with online hotel-booking startup Room 77 Inc., as the Internet search company continues to strengthen its hotel-search business.
Travelers use Room 77 to search for discounted hotel rooms based on location, brands, amenities, and ratings. The company's software allows users to search for and book their entire stay without leaving the Room 77 site or mobile app.
The San Francisco startup pulls data from more than 200,000 hotels globally and compares rates across numerous travel sites like Expedia Inc. (Nasdaq: EXPE), Priceline Group Inc. (Nasdaq: PCLN), Orbitz Worldwide Inc. (NYSE: OWW), and Hotels.com.
Room 77 officials announced the partnership in a letter to shareholders yesterday. According to the letter, Room 77's Chief Technology Officer and Co-Founder Calvin Yang will be joining Google, along with numerous Room 77 engineers.
The deal is the latest step for Google as it strengthens its online travel search business.
Google launched "Hotel Finder" in 2011, which pulls price and availability information from numerous travel sites. That same year, Google purchased the flight information company ITA Software Inc. for approximately $700 million, allowing users to book flights as well as lodging. Over the past three years, Google has added mobile platforms and strengthened its search by improving photos, room rate information, and availability information.
Room 77's software should allow Google to more seamlessly integrate the various parts of its travel search and online travel booking business.
Financial terms of the deal were not released. Room 77 previously raised $43 million from individuals and several venture capital firms. The company has also been backed financially by Expedia.
According to Bloomberg, Room 77 is expected to pass along "tens of millions of excess cash" to investors. Following the deal, the company will also be keeping its "brand, websites, mobile applications, patents" and other technology services.
Expanding its travel-search business is just a small step forward for Google, and thanks in part to the Google stock split last week, investors can expect to see many more similar deals…