OTA & Travel Distribution Update: Marriott and Expedia reach landmark deal; TripAdvisor seeks to provide more transparency in response to recent criticism; Hotelbeds severs ties with rogue intermediaries

Foster Garvey PC

This week’s Update is by far one of the most substantive Updates we’ve had in some time.  Enjoy.

Landmark Deal Seeks to Resolve Rogue Intermediary Challenges
("Marriott and Expedia Exclusive Agreement Will Retake Control of Wholesale Rates,"Skift Travel News on Sep 17, 2019)
While much has already been written about (and in the weeks and months to come will continue to be written about) the recently announced wholesale distribution agreement between Marriott and Expedia, I could not send this week’s Update without at least some mention of the deal.  For months, we have been featuring stories about the trials and tribulation of hoteliers seeking to reign in the rogue (and, in many instances, contractually unauthorized) practices of various wholesalers and other channels.  These stories reflected our own clients’ frustrations working with many of the same channels.  While I appreciate the immediate reaction of many who have asked why any hotelier would ever want to get this close to Expedia, I think the answer is simple.  If an established (and stable) provider of superior technological solutions came to you and offered to take the daily challenges of managing (and perhaps, disciplining) many of your most difficult distribution channels off your plate, wouldn’t you be interested? 

Responding to Recent Criticism: TripAdvisor Seeks to Provide More Transparency
("TripAdvisor shares fake review data in new “Transparency Report," Phocus Wire on Sep 17, 2019)
Just last week, we featured a story regarding the latest watchdog to question the veracity of TripAdvisor’s many reviews.  I don’t want to suggest that our blog post was the reason behind the transparency report released this past week by TripAdvisor (but maybe?), but the repeated criticism obviously compelled TripAdvisor to do something.  On Monday, TripAdvisor released its inaugural “TripAdvisor Review Transparency Report,” which details the technology and processes used by TripAdvisor to identify and reject 3.1 million (4.7%) fraudulent reviews this past year.  Not surprisingly, TripAdvisor also used the opportunity to dispute recent criticism as being based on “inaccurate figures.”   

Hotelbeds Severs Ties with Rogue Intermediaries
("Wholesaler Hotelbeds Cuts Ties to Booking Sites That Break Hotel Distribution Rules," Skift Travel News on Sep 16, 2019)
The timing of Hotelbeds’ announcement this past week is interesting.  Just 24 hours (maybe less) before Marriott and Expedia announced their landmark wholesale distribution agreement designed, in part, to reign in the abusive practices of wholesalers, Hotelbeds (one of the many wholesalers often accused of such practices) announced that it was taking action.  According to Hotelbeds’ Managing Director, Carlos Munoz, the Spanish wholesaler has been working with hoteliers to identify and withhold inventory from Hotelbeds’ customers that distribute hotel room inventory in violation of hoteliers’ distribution rules.  Whether this recently announced change by one of the largest of wholesalers makes a difference in the eyes of hoteliers, only time will tell. 

Other news:

City Attorney sues online travel sites for alleged illegal, deceptive practices
San Francisco Examiner - Breaking News on Sep 20, 2019
San Francisco City Attorney Dennis Herrera on Thursday sued companies operating two online travel sites, JustFly and FlightHub, for alleged illegal and deceptive practices including hidden fees. The lawsuit filed in San Francisco Superior Court says that together, the companies comprise the fourth-largest online travel agency in the U.S. market. 

Expedia and United Agree to Multiyear Contract Avoiding Messy Divorce
Skift Travel News on Sep 16, 2019
United had previously stated that it’s a new era because of its mobile app and its ability to attract direct traffic to its websites. But the two parties found a way to come to terms. After a court fight and months of posturing over parting ways, Expedia Group and United have announced a new multiyear contract, avoiding some disruption as the existing pact was set to expire September 30.

Amoma.com Troubles May Delight Hoteliers That Hate Its Rate Discounting
Skift Travel News on Sep 13, 2019
Online consumer review forums lit up Friday with complaints from many travelers that they had been stranded when hotels stopped honoring reservations booked via Amoma.com, an online agency. Spanish news publication Preferente claimed Friday that Amoma had filed for bankruptcy. Amoma CEO Nicolas Arthur and his co-founder, chief technology officer, Yann Arthur, didn’t respond to our text messages at the time of publication.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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