Hoteliers not impressed with Expedia-Orbitz deal

Hospitality professionals think the US $1.3 billion deal could result in a market monopoly

Travel, Expedia to buy orbitz, Orbitz expedia take-over, Orbitz-expedia sale

The hospitality industry in America is worried about Expedia’s plans to purchase rival OTA Orbit for US $1.3 billion, which it announced earlier this year.

The American Hotel & Lodging Association (AHLA) has released a statement saying that they believe the purchase would result in larger fees for hotels and higher prices for guests, as well as resulting in “severely reduced customer choice”.

“We believe this transaction and the resulting consolidation of the online travel marketplace will result in significant negative consequences, particularly for consumers, but also for the large number of our members who are small business owners and franchised properties,” said Katherine Lugar, CEO of AHLA.

Did you like this story?
Click here for more

One of the group’s main gripes is that the commissions hoteliers pay are, on average, 11% more than what Orbitz charges.

The group’s statement said that many smaller, independent hotels rely on these sites to attract travellers who otherwise would not have heard of their properties. If Orbitz falls prey to Expedia, these properties would be priced out of the OTA game.

If Expedia’s purchase of Orbitz is successful, Expedia and competitor Priceline Group will control 95 percent of the online travel agency bookings in the U.S., according to the statement, which raises questions about whether the sale would end up violating U.S. monopoly/anti-trust laws.

Orbitz Worldwide Inc., is based in Chicago and owns CheapTickets.com, Orbitz.com and HotelClub.com.

The proposed acquisition is still under review by the U.S. Department of Justice.

For all the latest hospitality news from UAE, Gulf countries and around the world, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page.

Most Popular

Newsletter

Reports

Human Capital Report 2017

Human Capital Report 2017

The second annual Hotelier Middle East Human Capital Report is designed to explore the issues, challenges and opportunities facing hospitality professionals responsible for the hotel industry’s most important asset – its people. The report combines the results of Hotelier Middle East's HR Leaders Survey with exclusive interviews with the region's senior human resources directors.

Hotelier Middle East Housekeeping Report 2016

Hotelier Middle East Housekeeping Report 2016

The Hotelier Middle East Housekeeping Report 2016 provides essential business insight into this critical hotel function, revealing a gradual move towards the use of automated management and a commitment to sustainability, concerns over recruitment, retention and staff outsourcing, and the potential to deliver much more, if only the industry's "image problem" can be reversed.

From the edition

From the magazine