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Google works with hotels to hurt travel competition

wsj.com

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Re: Google works with hotels to hurt travel competition

#5
post #4

Protip: you can just paste the following to the address bar to bypass the paywall: javascript:window.location='https://facebook.com/l.php?u='+window.location

in Chrome you paste window.location='https://facebook.com/l.php?u='+window.location in the Console.

Also you can follow the link https://facebook.com/l.php?u=https://www.wsj.com/articles/go...

great tip, thanks

Re: Google works with hotels to hurt travel competition

#6
This seems to be a sour grapes article representing the grudges of online travel agencies (OTAs) against Google. This quote really caught my attention:

"OTAs earn a roughly 20% commission from hotels for each reservation they book, which covers their cost of marketing, inventory acquisition, customer support and payment processing."

20% is a ton! Later in the editorial, the writers complain about how Google takes "a 10% to 15% commission on net revenues from reservations booked through its meta-search. Google thus gobbles up most of the profits that OTAs earn".

But Google is taking on the marketing! To be fair, inventory acquisition and payments are also costs, but from running travel sites before, travel truly is a marketing game. As a result, their take makes sense given that they're really taking the place of the traditional marketing channel.

Google's concentration of power definitely is concerning. But the OTAs (who have been living off fat profits for years; see Priceline stock [1]) get none of my sympathy.

[1] https://finance.yahoo.com/quote/PCLN/; has outperformed Google stock over the past 10 years

Re: Google works with hotels to hurt travel competition

#8

Yay anti-competition! It's it impossible for any large company to simply make a better product any more and use that to compete? Or must it always be bend the rules, bend the law, lock people in to avoid competition? Is there an alternative?

At a certain level of complexity, it's easier to simply externalize costs than to improve the product. Especially when you have organizations as large as Google, it's hard for any single employee to make decisions in the best interest of the user, as there are massive incentives all the way up the ladder to maximize short term profits. It's really on small, agile companies to innovate.
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