What Will Google Buy Next?

It took a bumpy nine-month gestation period, but Google (Nasdaq: GOOG  ) finally got its dot-com baby.

Regulators cleared the search giant's $700 million acquisition of travel data specialist ITA Software on Friday, but it wasn't free of concessions. Facing resistance from travel portals that rely on ITA and envious search engine rivals, the Department of Justice set some pretty strict conditions to ease antitrust fears.

Google will be required to keep licensing its software to travel portals. Big G also conceded to internal firewalls and a regulator monitoring provision.

Why is Google bending so far for the right to play a larger role in the travel niche? I would argue that Google has even bigger acquisitive fish to fry in the coming months, and it was simply giving up some freedoms that were going to go away anyway if it aims higher.

Finding the next Groupon
When Groupon walked away from an alleged $6 billion buyout offer from Google -- a deal that seemed too good to be true back in December -- it was reported that the deal breaker was demands for a lofty termination fee. Groupon felt the deal wouldn't clear regulatory hurdles, and Google must've been unsure, too, if it wasn't willing to meet the social-coupon site's breakup provision.

However, Google's concessions this time around may very well address concerns that may come up in future acquisitions. In short, Google's giving itself a hall pass.

It may be too late for Groupon. The flash sale phenom is barreling toward a likely IPO in the next year or two. Facebook and Twitter are also unlikely to entertain any buyout offers, since history has vindicated earlier head shakings.

This doesn't mean Google is going to rest its laurels on organic growth. It has $35 billion sitting in cash, cash equivalents, and marketable securities, with little intention of returning that greenery to shareholders through dividends or massive share repurchases.

Investors also need an acquisitive spark. Analysts see earnings growing in the midteens during the next two years, a far cry from its earlier speedster days.

Diving into Big G's shopping list
Google has quietly gobbled up small companies like a PacMan arcade game with a blown speaker, but it hasn't shied away from the big deal. It had no problem shelling out nine-and 10-figure deals when it wanted DoubleClick, YouTube, and now ITA.

I took a look at a few small companies that would look good on Google's arm last year. Here are a few public companies with meatier market caps that would make synergistic sense for Google.

• AOL (NYSE: AOL  ) -- Things haven't been going well for AOL lately. Ad revenue, access subscribers, revenue, and profitability have all been roughed up in recent quarters. However, AOL comes at a cheap price tag relative to its gargantuan traffic volume. AOL's display advertising strength is a plus. Its Groupon-like Wow.com site would also give Google more skin in the lucrative prepaid voucher space.
• OpenTable (Nasdaq: OPEN  ) -- Google's mandate to get socially stickier in 2011 is going to need a local push, and it's hard to ignore the allure of the undisputed champ of Web-based restaurant reservations. Revenue and adjusted earnings soared 61% and 143%, respectively, in its last quarter. OpenTable isn't cheap. Shares have popped fivefold since going public two years ago. However, it makes sense if Google can't grab Yelp.
• Travelzoo (Nasdaq: TZOO  ) -- If ITA is a meaty appetizer, Travelzoo would make an ideal dessert. Travelzoo is the travel deals publisher behind its namesake weekly email of 20 sponsored getaway bargains that goes out to 18.9 million willing recipients. Travelzoo and OpenTable have seen their shares take off since introducing Groupon-esque vouchers in their respective areas of specialty. Travelzoo also isn't cheap, but Google is going to have to pay up if it wants high-octane growth stocks.
• IAC (Nasdaq: IACI  ) -- Barry Diller's portfolio is loaded with dozens of magnetic websites. Antitrust watch dogs would likely require Google to dump Ask.com and video-sharing website Vimeo given Big G's dominance in those areas, but at least it could make sure that it doesn't fall into Microsoft's (Nasdaq: MSFT  ) hands. Google would be able to cash in on home services lead generator ServiceMagic, city guide Citysearch, and dating website Match.com. It could also populate YouTube with proprietary content through College Humor and give social gaming another go through Zwinky. 

There's a world of acquisitive opportunities out there for Google, and that's before exploring dynamic buyouts overseas.

Get going, Google. The clock's a-tickin'.

Who do you think Google will buy next? Share your thoughts in the comment box below.