Microsoft, who has been on quite the buying spree as of late, confirmed its purchase of Seattle-based airfare prediction and travel site Farecast earlier this month for what is believed to be around US $115 million. Farecast was started by University of Washington computer science professor Oren Etzioni. It was initially bankrolled by Madrona and built with people from local companies like Alaska Airlines and AdRelevance.
Essentially it is an online service that uses data mining technology to attempt to predict whether the price of specific air-travel itineraries will rise or fall and whether currently listed hotel rooms are good bargains. It may, for example, recommend that travelers purchase a Seattle to Cleveland flight for early June because prices will be rising over the next week. It will then offer a percentage based confidence level on that prediction.
"Farecast has been a partner of ours on MSN Travel and we look forward to working closely with the Farecast team to incorporate and apply its technology in new and interesting ways," Whitney Burk, a spokeswoman with Microsoft's Online Services business, said in a statement. Farecast first formed a distribution partnership with Microsoft in July 2007, lending their prediction and planning services to the MSN Travel Web site.
Details are scarce as to what will come out of this acquisition, or how Microsoft plans to use the technology behind Farecast. Farecast President and CEO Hugh Crean stated in a brief company blog that the "acquisition creates tremendous opportunities for the Farecast team and our customers. We look forward to sharing more details in the weeks to come." All 27 Forecast employees will become Microsoft employees as part of the acquisition, have received emails welcoming them into the "Microsoft family"
Microsoft has been averaging about two acquisitions a month in recent years in an attempt to attract more Web users and boost online ad revenue. Their aggressive moves, which include bids to purchase Yahoo!, are considered attempts to catch up to Google in the US $40.9 billion global online ad market.
The Farecast acquisition also highlights Seattle's thriving tech community, as it is one of several other Seattle-based startups to be purchased by Microsoft. Visit Farecast and read their *very* brief statement on this acquisition.