TravelBizBuzz

It's official: Cendant Corp. is shedding its travel distribution services subsidiary.

The company has agreed to sell Travelport -- formerly Cendant TDS -- to global private investment and advisory firm The Blackstone Group for $4.3 billion, Cendant announced June 30.

Proceeds from the sale will be used to reduce the indebtedness allocated to two of Cendant’s other subsidiaries: Realogy Corporation and Wyndham Worldwide Corporation. Those subsidiaries will be spun off in late July, the company disclosed.

The deal is expected to close in August 2006.

Posted by TDR at 03:32 PM | Permalink | Comments (0)

Today's guest blogger is Gregory Saks, director of market intelligence service Compete’s new Travel Practice. The new division analyzes consumer travel planning and reservation behaviors across more than 2,000 travel sites in more than 20 categories, using Compete’s extensive database of more than 2 million consumers. Here Saks presents Compete's analysis of supplier-OTA share shift in the first quarter of this year:

While online travel agencies (OTAs) remain the largest individual destinations for travel research, it is suppliers who are capturing the majority of online bookings.

An analysis of online transactions in the air and lodging categories during the first quarter of 2006 showed that:

— Hotel chains captured 52% of online hotel bookings versus 48% of hotel bookings transacted on OTAs.

— Airlines captured 29% of online flight bookings versus 71% of flight bookings transacted on OTAs.

In both of these categories it is clear that suppliers have been successful in marketing their Web sites. Programs such as best rate guarantees and no booking fees have siphoned interest away from agencies. While airlines have been more effective than hotels, that is partly due to the performance of one carrier.

In each month of Q106, there were about 4.2 million consumers who booked a flight online. More than 70% of these bookings took place at carrier sites directly (i.e., United.com, JetBlue.com); the remainder took place at OTAs.

Interesting: Southwest is one of the main drivers for the amount of carrier-direct bookings. Consumers can't book Southwest flights on OTAs, and the carrier’s site accounts for over 1 million bookings per month.

Essentially, Southwest is single-handedly increasing the market share of carrier-direct sites. If you took them out of the picture, the picture looks more balanced: The remaining carriers would capture 60% of online bookings directly with agencies handling the other 40%.

Posted by TDR at 03:42 PM | Permalink | Comments (2)

Today's guest blogger is Henry Harteveldt, VP of travel research for Forrester Research. Harteveldt took a few moments to share his thoughts on the Conference Board's report that claims online travel has reached a two-year low:

It seems the Conference Board’s study may have overlooked some points that the travel industry itself is aware of:

a) Women tend to do more of the travel planning than men, unlike the results of the Conference Board study which stated the opposite to be true.

b) Most people make their travel plans before the summer, not during it. It’s almost July, so it’s likely that many travelers have already completed their summer vacation research by now.

c) And, finally, travel has not been thwarted by rising fuel costs. In fact, many flights are already sold out.

Do you have a comment about a story or news item? Tell it to us and your thoughts could become a blog feature! Simply e-mail us your ideas or leave a comment below and we'll take it from there.

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Think nothing can burst online travel’s bubble? Think again.

Increased travel costs may be keeping travelers from using the Internet to make their summer travel plans, according to the Consumer Internet Barometer, released jointly June 21 by The Conference Board and custom research company TNS.

Only 28 percent of men surveyed said they planned to research airline rates and availability online during the summer, compared 41 percent just two years ago. The percentage of women using the Web to research and plan remained constant (25 percent).

“Vacation plans may have fallen victim to higher gas prices, rising travel costs and an increasingly uncertain economic outlook,” said Lynn Franco, director of The Conference Board Consumer Research Center.

The study found that while more men than women use the Web to make travel arrangements, overall consumers spend more time researching travel online than booking it there.

However, online bookings for air travel in particular do seem to be growing, according to new statistics from SITA’s Airline IT Trends survey, released June 22.

The global average of online flight ticket sales climbed 8 percent from 20 percent last year -- that’s approximately 560 million online bookers out of the airline industry’s two billion passengers, the study found.

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Today's guest blogger is Chris Kroeger, senior VP of North America for Sabre Travel Network. Sabre recently announced its new solution geared toward combating content fragmentation. Here Kroeger shares his thoughts on the industry's reaction to the Efficient Access Solution:

Some have described Sabre Travel Network’s launch of the Efficient Access Solution -- the voluntary program to assure full content and service fee protection for participating travel agents using Sabre’s Global Distribution System (GDS) -- as “stirring up a hornet’s nest.” Those are certainly strong words; however, I think they are off base.

Generally speaking when you stir up a hornet’s nest you do it accidentally, and suddenly, and without cause or justification. And the chain of events you set in place creates havoc, chaos, fear and pain. This is hardly the descriptor for a program that tackles the travel industry’s challenges head on while carefully balancing the needs of all parties -- airlines, travel agencies, the GDS and travelers alike.

We have taken a thoughtful and thorough approach over the past three years to help our customers avoid the inefficiencies and costs of a fragmented travel marketplace. Those who claim these are not real issues are a bit out of touch. Fragmentation is real. The airlines have been very vocal and pretty specific about their plans to withhold content and implement fees, and some have even suggested charging for content.

The real hornet’s nest is a travel industry that returns to an era of inefficiency and redundancy -- where all players are forced to swarm about and create a buzz, but where very little productivity results -- to meet the needs of a select few. Consider these possibilities:

• Airlines managing fare and schedule distribution among dozens, if not hundreds of systems designed to handle some, but not all of their flights.

• Travel agents having to install and search multiple computer systems, Web sites and other sources to be able to shop and book the best trips at the right prices.

• The ultimate end user -- the travel consumer -- once again becoming the victim of the inefficiencies of splintered and fragmented travel content -- paying more for fewer choices and running the risk of missing out on the very best travel options for their needs.

This disaggregated world would cost the industry an estimated $1.5 billion in annual costs, even with just a small amount of fragmentation. Absorbing those costs is the true hornet’s nest for an industry where all players are already focused on controlling costs and improving earnings.

Instead of stirring a hornet’s nest, our solution helps avoid the hornet’s nest by carefully balancing the needs of all the players in the industry -- preserving and enhancing an already efficient marketplace.

Posted by TDR at 10:27 AM | Permalink | Comments (27)

Travel marketers have a new option for understanding and anticipating online travelers’ behaviors.

Marketing intelligence service Compete, Inc. has launched a new practice to target the $70 billion online travel industry, the company announced June 20.

“The competition for traveler attention and loyalty is intensifying,” said
Gregory Saks, director of Compete’s new Travel Practice. “Prompted by ongoing growth in the online travel industry, marketing executives are looking for new ways to improve online channel effectiveness and drive traveler mindshare,” he added.

The Travel Practice will increase Compete’s industry coverage and provide travel marketers with intelligence to capitalize on the 50 million travelers researching and booking online each month.

Compete’s new service analyzes consumer travel planning and reservation behaviors across more than 2,000 travel sites in more than 20 categories, using Compete’s extensive database of more than 2 million consumers.

Posted by TDR at 02:51 PM | Permalink | Comments (0)

Cell phone users now have another reason to gab it up in the Starbucks line.

Hotels.com has partnered with Sprint to allow users to access rates and book rooms through their Sprint Vision mobile phones, according to a June 15 release.

Mobile customers will have real-time access to more than 70,000 hotels, vacation rentals and bed & breakfasts. The feature includes “sorting options, viewing pictures of properties and instant access to their itineraries without the need to print and carry the itinerary with them,” says Scott Booker, VP of customer marketing for Hotels.com.

The “first of its kind” service harnesses OpenMotion LLC’s mobile distribution platform, the company explains.

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TRB's first guest blogger is Ankur Bhatia, executive director of The Bird Group, an IT and travel services provider for India. Bhatia took the time to share his thoughts on the challenges online travel agencies will face as they move more deeply into online travel in India:
___________________________

Online travel players are quickly swooping into the Indian travel space, but don’t think they have an easy journey ahead.

India is being touted as the world’s fastest growing aviation market in the world. Its thriving economy and investment in aviation are contributors to India's thriving travel market, but the country can also thank its geographic size, population, lack of road infrastructure and increased consumer spending.

Bonus: The Indian online travel space has huge potential for growth. It is projected to be one of the fastest growing travel and tourism markets (behind Montenegro and China) between 2006 and 2015. And, currently only 2 percent of India’s local population travels by air, but the middle class is 10 percent of that population — which means local travel will pick up, as well.

But, online agencies have their work cut out for them. They will have to find and aggregate the content that travelers need and want. They’ll also need to invest in the technology necessary to provide high quality service. Passengers want more convenience and less cost.

Most important: To reap the benefits of India’s travel boom, online agencies must focus on innovating online travel so that they can offer the travel-related information and services that consumers need for a unique travel experience.
___________________________

For more information about online travel agencies’ expansion into India, check out the June 19 issue of Travel Distribution Report, which features a one-on-one interview with Scott Blume, CEO of ZUJI, the company spear heading Travelocity’s move into the Indian travel market with Travelocity.co.in.

Want to be a guest blogger? Simply send us an e-mail with your thoughts and we'll take it from there.

Posted by TDR at 04:31 PM | Permalink | Comments (0)

SmarterTravel.com wants to help foodies find the perfect -- and tastiest -- destination.

The online travel site has released a report of the best destinations for food lovers, SmarterLiving announced June 12.

“Americans love to eat and Americans love to travel, and this report combines the best of both for people seeking destinations to enjoy all types of cuisine and food-related activities,” said Anne Banas, executive editor of SmarterTravel.com.

The report features a series of articles with titles such as “Eight Great Destinations for Dessert” and lists destinations the company believes will “get anyone excited about food,” Banas stated.

SmarterTravel also outlines where cooking enthusiasts can find food tours and cooking packages around the world, as well as provides a detailed listing of food festivals for the summer season.

For the full culinary report, click here.

Posted by TDR at 03:43 PM | Permalink | Comments (0)

Travel companies are flocking to the Indian online travel space.

MSN India is out to become the number one travel portal for Indian professionals. The site has partnered with U.S.-based online travel company Desiya.com to allow its users to book travel products online, the companies announced June 8.

Desiya’s goal is to “address the travel needs of people looking for an avenue where they can plan and book their travel to India from just one place,” said Amit Taneja, CEO of Desiya Inc.

MSN India hopes its partnership with Desiya will also attract India’s growing traveling population, which wants “convenience and hassle-free travel services,” explained Niraj Dutt, executive VP of MSN India’s sales partner NDTV Media.

On May 8, Travelocity announced its interest in expanding into India with the launch of Travelocity.co.in.

“In India, the online travel trade is about two percent today, but has the potential to reach 30 percent in five years,” said Scott Blume, CEO of Zuji, Travelocity’s Singapore-based APAC affiliate. The portal will become active in late 2006.

The online agency is specifically interested in acquiring Indian companies: “Our targets could be potential travel portals or systems that would fuel our operations,” Blume noted.

Not to be left behind, Mobissimo launched Mobissimo.in, “the first travel search engine for India” on May 15. The site searches every Indian airline, including airfare sites Air Deccan, Air Sahara, SpiceJet, GoAir, JetAirways, Air India and Kingfisher -- and online travel agency, including MakeMyTrip.

Mobissimo also searches Indian hotel and car rental sites, and includes India travel options in its Mobissimo Activity Search.

Internet services provider Sify Limited has thrown its hat in the Indian travel ring by purchasing Globe Travels, an e-ticket provider for travel between India and the U.S., according to a June 5 release.

“This strategic acquisition brings into our fold fast growing services that enhance our online offerings to customers” -- which include 3,330 iWay cyber cafes and 200,000 broadband users across India -- while opening up new sources of revenue, said R. Ramaraj, CEO of Sify Ltd.

Posted by TDR at 04:40 PM | Permalink | Comments (0)

The OpenTravel Alliance (OTA) has updated its XML message standards.

The group’s 2006A specifications offer a beefed up cruise message library that includes message sets covering multiple components of the cruise booking cycle, including a PNR update message, OTA announced June 7.

Other features of the new specs include two new message pairs for car rentals and an enhanced group hotel rooming list request and response message to meet the Convention Industry Council’s Accepted Practices Exchange (APEX) data requirements.

This publication cycle offers a reference guide for “travel companies who want to transport OTA messages” using the SOAP protocol, noted John Turato, chair of the OTA and VP of technology for Cendant Car Rental Group.

For more details, click here to download the specifications.

You can learn more about what the OTA is up to in the next issue of Travel Distribution Report. If you'd like to share your experiences using OTA standards, send us an email.

Posted by TDR at 04:53 PM | Permalink | Comments (0)

Sabre Travel Network is promising GNEs aren’t the only ones who can help ailing airlines cut costs.

The GDS has launched a program designed to provide travel agents with full access to airline content while also helping carriers reduce distribution costs, according to a June 7 release. Carriers that participate in the Efficient Access Solution will receive a reduced booking fee for reservations made by participating agencies, and agency members will receive full content and protection from airline service fees, among other incentives.

Sabre Travel Network’s intention is to “develop a multilateral approach that balances the needs of all industry players” and puts a stop to industry fragmentation, explained Chris Kroeger, senior VP for North America.

However, Sabre’s motivation for introducing the program may not be so cut and dry. “Clearly, after cutting back revenues in airline renegotiations, Sabre is using this program to keep their bottom line even by taking money out of the pockets of travel agencies,” commented Ellen Lee, VP of business development for alternate distribution system G2 SwitchWorks.

G2 boasts full content agreements with 11 airlines, including American Airlines, Continental Airlines and Delta Air Lines. G2 also works with multiple agencies, including Carlson Wagonlit Travel, and reaches approximately 9,000 agents through its’ G2Agent product and partnership with Trisept Solution’s VAX VacationAccess.

To contribute to this story, send us an email with "Efficient Access Solution" in the subject line. Otherwise, stay tuned to the June 19 issue of Travel Distribution Report for a detailed analysis of Sabre’s new program.

Posted by TDR at 02:39 PM | Permalink | Comments (0)

The travel industry is not static -- nor is it silent. That's why the Travel Research Bureau, publisher of the Travel Distribution Report, has created a place where you can keep your ear to the ground for industry moving & shaking, controversies and new trends -- and chime in with your own opinions.

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Thank you for visiting -- and contributing to -- a lively forum that strives to keep up with this dynamic industry.

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