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Google works with hotels to hurt travel competition

wsj.com

11–20 of 68 posts

Re: Google works with hotels to hurt travel competition

#11
post #9

Question to anyone here who is familiar with this industry. Would one be able to save even more by just going to a wholesaler? I mean, with the right know how, can someone just buy from a wholesaler directly?

What do you mean by wholesaler? You can certainly negotiate special rates directly with the hotels if you have the leverage. Wouldn’t be surprised if OTAs do the same. Same for Amex and the likes

Re: Google works with hotels to hurt travel competition

#13
post #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…

Seems like almost every hotel chain nowadays pitches booking through their own Web site, often throwing some extra perks for direct bookings. They also try to rope the customers in with fairly generous loyalty programs, “unpublished” rates and credit card marketing tie-ins.

So yeah, seems like OTAs were okay with this as long as it was IHG, Hilton, Marriott, Accor, Choice Hotels and Best Western doing this on their own (or through fairly low-traffic sites like roomkey.com or pointshound.com), but now that Google actively promotes direct bookings, they’re feeling the effect.

Re: Google works with hotels to hurt travel competition

#15
post #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…

> But the OTAs (who have been living off fat profits for years; see Priceline stock [1]) get none of my sympathy.

Any move that hurts Booking.com's revenues is a good move, by me.

I don't have an issue with them taking 20% commission, but I loathe all of the dark patterns they employ to make that commission.

Re: Google works with hotels to hurt travel competition

#16
This article is largely incomprehensible and seems strongly biased. Having said that, I don’t quite see how consumers are being hurt. The issue only seems to be with very targeted search queries such as “Hilton Houston” where Expedia, etc. ageeed voluntarily not to show ads and smaller ones are allegedly somehow blocked by Google. But: if one searches for such a specific term, a customer will almost always be harmed by booking through an OTA. Most hotel chains guarantee the lowest rates on their websites plus offer benefits such as points that you wouldn’t receive when booking through an OTA. Someone has to pay for the 20% cut - and it’s not the OTA

Re: Google works with hotels to hurt travel competition

#17
post #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…

This to me still seems like a net loss.

   old: OTA makes a $20 commission on a $100 rate through them

   new 1: Google makes an ~$20 commission on a $140 room rate (15%) through Hotel

   new 2: Google makes a $17 commission on the $117 room the OTA now has to sell it. 
   Or the OTA tries to still sell at ~$100 and only makes a $3-$5 commission.
And this lovely quote:

> Google also requires OTAs to give its webcrawlers access to proprietary information including room availability, descriptions, pricing and custom bundles and other data—information that OTAs typically keep closely held from competitors.

Great, the amazon model of "to run on our platform we get all the data of what's profitable for you, how profitable it is, and what buyer interest is, and we then use that to power our competing product which also runs on our platform to take all the profit out of the marketplace and force you out."

Nope this isn't illegal, but again seems like an abuse of position. It's like running a competing restaurant, but also being the city's auditer and gathering all financials as well as the food inspector who is required to inspect (watch) every recipe and dish get made to be able add it to their own menu if it's a hit.

And finally regardless of all of the above, does noone else see it as a problem the general idea of looking for a percentage of revenue of every link a user follows from google? For example next them move into newspapers, and want a percentage of subscription ad-revenue for users forwarded. "Yeah we own adwords, but it's not anti-competitive. You can always run ads on your site and just not be indexed by us. [And not get referral traffic]. If you want us to accurately spider your site and refer to pages, we take a percentage".

So hotels, car rentals, flights, shopping, movie tickets, (and any other search that google productizes)... The end game of this is have any transaction that happens on the web that came from a google referral, they get a cut. It's obviously not there yet, but that's the direction they keep moving: Turn search into an app store / amazon style platform and get 20% of everything on the internet.

Re: Google works with hotels to hurt travel competition

#18
post #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…

Seems like almost every hotel chain nowadays pitches booking through their own Web site, often throwing some extra perks for direct bookings. They also try to rope the customers in with fairly generous loyalty programs, “unpublished” rates and credit card marketing tie-ins. So yeah, seems like OTAs were okay with this as long as it was IHG, Hilton, Marriott, Accor, Choice Hotels and Best Western doing this on their o…

This. I book quite a few hotel stays throughout the year and you will definitely get perks and resort credits when booking directly. Just ask for it. They don't want you hanging up the phone and going back to Kayak which may lead you to another property while deciding.

Re: Google works with hotels to hurt travel competition

#19
post #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…

> This seems to be a sour grapes article representing the grudges of online travel agencies (OTAs) against Google.

Superficially, but more deeply it's part of the propaganda war the WSJs corporate parent has been carrying out against Google on all fronts for quite a long time, which is in part partisan/ideological, and in part business over similar issues in publishing.

Re: Google works with hotels to hurt travel competition

#20
post #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…

> But the OTAs (who have been living off fat profits for years; see Priceline stock [1]) get none of my sympathy. Any move that hurts Booking.com's revenues is a good move, by me. I don't have an issue with them taking 20% commission, but I loathe all of the dark patterns they employ to make that commission.

'... but I loathe all of the dark patterns they employ to make that commission.'

I tried to leave a negative review for a hotel on booking.com and the overall result was 3.5 out 5!

At least with google reviews I can get a fair picture of what the place is actually like.

And, all that 'just one room left at this price' is basically fraud.

It does annoy me though when I try to book direct and get charged the exact same price. I know with chains you get loyalty discounts and such but a there are still a lot of independents where you don't.

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