3 ms·
A total crock. Having worked for an OTA I can guarantee you that the last thing TA will do is try to build an entire backend to book the hotels themselves. In h
by coldcode 12y ago
A total crock. Having worked for an OTA I can guarantee you that the last thing TA will do is try to build an entire backend to book the hotels themselves. In hotels you only make good margin on huge volume since they more you bring customers the better numbers you can demand. It's not just the processing, it's the relationships with thousands and thousands of hotel chains and individual hotels. It's customer service and dealing with all of those hassles. It's competing in all the different types of hotel booking submarkets (tonight, opaque, long term, vacation, packaging etc). Getting a small percentage of so many sales with almost no expense is way easier than getting more margin but having huge outlay and competing with the big guys (namely Expedia mostly in the US and Priceline mostly everywhere else in the world outside of China). They would be insane to switch their business model. Orbitz is too dinky to compete effectively and Travelocity gave up and is essentially Expedia now. Tripadvisor is in a great place where they bring traffic to everyone but compete with no one. Once they lose that they will lose period. I highly doubt E and P miss their percentage at all.
- gdilla 12y agowhy not just acquire themselves there? They are loaded.
- e15ctr0n 12y ago> TripAdvisor's boss, Stephen Kaufer, denies he wants to take on the big two. "We are a media site," he says. "I want Expedia and Priceline to thrive because they are my clients." Looks like the boss agrees with you. > But soon, holidaymakers will be able to book their entire trips without leaving the TripAdvisor app. Rivals beware. The Economist is known for making bold predictions. What do you think this one is based on?
- foobarian 12y agoThey could be reading too much into it. The on-site booking still talks to OTA's back-end API. It's probably most useful to small OTAs who don't want to bother/don't have resources to build their own top-tier UI. But a site like Expedia will probably have their own, nice, well converting UI.
- walterbell 12y agoDoes TA get paid as an affiliate for completed transactions, or are they paid for traffic (CPC)?
- coldcode 12y agoBoth. Even the OTA's themselves do this from competitors. You'd be surprised how much they make although it's just a sidelight for them.
- walterbell 12y agoIs there room for enterprising HN readers to siphon some of this business via niche travel sites? Volume must be large if OTAs are sending traffic to competitors, a bit like traffic peering between ISPs.