AirAsia website gets 300m hits in the first 11 hours of its new campaign

Low-cost carrier AirAsia says it recently set a new world record with its latest 1 Million Free Seats campaign and then broke it the very next day.

Navitaire, AirAsia's host reservation provider, shared that the airline set a new international sales record with 402,222 seats snapped up in the 24-hour period after the campaign was launched. Significantly, 489,000 seats were snapped up in the second 24-hour period.

AirAsia's regional head of commercial, Kathleen Tan said "The AirAsia website – www.airasia.com had registered more than 300,000,000 (300 million) hits in the first 11 hours of the campaign alone. The success of the campaign is attributed to the power of our blog and social network platform with over 100,000 Facebook followers and more than 10,000 Twitter followers."

Tan added that airline's growing success proves clearly that the traditional days where consumers have to wait in long lines to purchase their flight tickets at the sales or airport counters are now gone forever.

"It is also a clear endorsement of our strategy of expanding our route network and adding new destinations – such as Taipei, Chengdu, Kochi, Kolkata, Trivandrum, Abu Dhabi – and adding new hubs in Bali, Phuket and Bandung in Indonesia and Penang in Malaysia in addition to our existing hubs of Kuala Lumpur (Malaysia), Jakarta (Indonesia) and Bangkok (Thailand)," said Tan.

She also mentioned that the expanding route network and the frequency of flights allows AirAsia's guests to plan their itinerary to hop and hub around ASEAN in particular, but also in general around Asia, Australia and Europe (London).

“The worst is over”: easyJet’s Andy Harrison

Low-cost airline easyJet's chief executive Andy Harrison believes the worst of the recession is over for the airline industry but warned recovery would be slow.
 
"I think the worst is over but I don't see any improvement either and expect demand to be stable for the next nine months at least," Harrison told Reuters in an interview. "Winter will be a continuation of what we have seen...we will see continuing weaker consumer demand."

easyjet recently reported a big fall in full-year profits to the end of September, after the rising price of oil pushed up fuel costs.

Pre-tax profits were £54.7 million , half of the £110.2m the airline made a year earlier.  This came despite a 13 percent rise in sales from £2.36 billion a year ago to £2.67 billion. Passenger numbers rose by 3.4 percent to 45.2 million.

Harrison had said that the airline had been hit by its fuel hedging policy, in which it buys fuel at prices agreed in advance. Movements in the price of oil meant that the company had lost out in the year to September.  However, he said the airline should benefit to the tune of £100 million in 2010 from its fuel-buying policy.

Three Airlines Become True Grinches By Raising Holiday Surcharges

That's right lady, go ahead and type in our checked baggage fees and holiday surcharges; we now know to avoid your airline in future travels. You see, three airlines have become the grinches of the holiday travel season. Not only are they throwing down the baggage fees, but they're already upping recently-announced peak travel surcharges, some of which continue through to 2010.

The offending airlines are: United, Delta and US Airways. Might as well just throw all your spare change and travel coffee money at them now, with all the little additional nicks they're taking at your wallet...

American Express Will Hold Your Miles Hostage If You Pay Late

The corporate sharks at American Express apparently see no reason why Delta, United, and American should get to levy random fees while they have to settle for regular, reasonable, generally accepted fees. How old fashioned! So the credit card, which is cobranded with Delta, JetBlue, Hilton, and Starwood Hotels, is introducing a new fine for customers who are late on their bills.

Not only will those customers have to pay all the normal late fees, but they'll also have to pay an additional fee if they want the points that they've earned to get transferred to their hotel loyalty accounts or frequent flier programs. 

Greenport: The Hamptons See Star Power Even In The Low Season

The Hamptons have always been a hot spot for celeb activity, but this week it's the North Fork region of Long Island that has the big names. Yesterday, Tom Cruise was spotted jogging on Route 25 through Orient and East Marion with his bodyguard, who rode along side him on a bicycle. Tom seemed to be enjoying his run and waved to fans as they drove by. He was probably happy to have a few days off.

Tom's been busy working on the movie Knight and Day with Cameron Diaz in Boston. The production was scheduled to move to Salzburg, Austria today but Austrian filmmakers protested a tax incentive offered to Cruise and company by Salzburg authorities. In response to the backlash, the shoot has been cut down to just 7 days rather than the three weeks they had originally scheduled. Tom and Cameron will also be shooting in Spain and Hawaii over the next few week.

So, what would bring Tom Cruise to eastern Long Island in the middle of November? Most likely, his third anniversary with wife Katie Holmes. Mrs. Cruise is currently filming The Romantics in Southold, NY with co-stars Adam Brody, Elijah Wood, Anna Paquin, Josh Duhamel and Malin Akerman. The cast seems to be making themselves at home while filming in Long Island. Adam Brody and Katie Holmes have been frequenting the Starbucks in Greenport while Elijah Wood was recently seen at Love Lane Kitchen in Mattituck.

Random Airline Fees Continue Into 2010, Including Super Bowl Travel

Remember all those airline fees that were pouring in a few months ago related to this season's holiday travel? Well the airlines must have really enjoyed what they were seeing, as they are now looking to tack in some additional charges for days well into 2010. Delta, United, and American Airlines are busy adding these presents to our tickets anytime they think travel will be busier than usual.

The fees can be as much as $30 each way depending on distance, time, and other factors that appeal to the airlines. Our favorite airline fee has to be the $50 one-way charge that has now been added to some flights on February 8. In case you don''t have the NFL calendar kicking around, that's the day after the Super Bowl. Not like we could afford tickets anyway, but we can still be angry about it.

Air Canada Gets Into The Fee-For-All With Exit Row Seat Charges

Air Canada has been busy spending lots of cash on stuff like iPhone Apps, in-flight WiFi, and snazzy software for your Blackberry. This stuff all costs money, and like all other airlines, the money probably isn't just pouring in up in Canada. So the country's flagship carrier is opening up the fee and charge toolbox in hopes of finding a good way to boost revenue.

The airline will begin to charge for seats with more room to stretch out your legs. That means scoring an exit row or bulkhead seat with the online seat selector has become a thing of the past. It will set you back at least $14 each way to reserve one of those seats. We do love getting an exit seat, but it's kind of sad that we are willing to pay for an upgrade —after all, it's still coach.

FlightSearch.com: An Interesting Twist on Search Aggregation

Thanks for this post go to Author Tom Botts of Hudson Crossing

Does the world really need another search aggregation website? Well, we are about to find out. FlightSearch.com has gone live (in beta) with an interesting approach to searching multiple travel sites.

Unlike some other players such as TripAdvisor's bookingbuddy.com, TravelZoo's SuperSearch, FlightSearch searches multiple sites without opening window after window after window as each separate site is searched. Users are able to simply tab between results from Priceline, Orbitz, CheapTickets, Vayama, Kayak and others. (Does Kayak's inclusion make FlightSearch a meta of metas?) FlightSearch is a really nice take on an oft-copied model. And not a bad URL either.

FlightSearch is led by travel industry vet Ted Perlstein (full disclosure: Ted worked for me at Starwood as a summer intern once upon a time - he probably considers it a dark period in his career) who has also has been at Orbitz and once upon a time, carried a business card with the title of "Head Sherpa" when he was at an earlier incarnation of lastminutetravel.com

As we mentioned, FlightSearch is still in beta so there are a few things we'd still like to see improved, but we'll be watching to see when other OTAs (and metas?) join up. And how about a few suppliers? Where are you American and United et al? Obviously, driving traffic in this hyper-competitive space will be a challenge but we like the approach Ted and team are taking...

Thanksgiving Travel Down, Prices Going Up Anyway

Fewer than one in five Americans are planning to cut back on their Thanksgiving spending, but almost one-third are curbing their overall holiday travel this season. That's not going to devastate the airline world, since a lot of that travel would have happened by car anyway. And to be honest we kind of like the excuse: "sorry uncle and aunt so and so—we'd love to come over and have our annual fight about whether Obama's birth certificate is real, but we just can't afford the gas in this recession."

But the scaling back is still going to be enough to take a bite out of the industry:

George Clooney Exclusively Flies American Airlines For 'Up In The Air'

Why should kids' movies have all the cross-promotional fun? According to the folks at Paramount, they shouldn't. That's why they teamed up with American Airlines who, in exchange for product placement in the new George Clooney movie "Up In The Air," let the film's director, Jason Reitman, have free filming access to its terminals, planes and the Admirals Clubs. The access came in handy considering the movie is about an executive who flies around the country and fires people.

But the partnership doesn't end there. Last weekend American hosted a press junket on one of its 767 that featured a screening of the film, a live performance by Sad Brad, the band that composed the film's soundtrack, and an interview with Anna Kendrick, who plays Clooney's apprentice in the film. American is also sponsoring tie-in auctions exclusively for AAdvantage Miles members for upgrades and movie-related items.

Buy your hotel room or car with SkyMiles at Delta.com

Thanks for this post go to Author Tom Botts of Hudson Crossing

While trolling around Delta.com this afternoon looking to burn some of our hard-earned SkyMiles we came across a new (or re-launched) feature called the SkyMiles Marketplace. SkyMiles members can search for hotels and cars and then use SkyMiles to pay for some or all of the cost of the room or rental. The redemption rates can be a little dear but hey with air redemptions getting harder and harder, it is nice to have another option - particularly one without capacity controls and the like.

A little sleuthing shows that this is another website powered by ezRez. ezRez has been on a terror of late, launching similar pay with miles/points programs with the likes of Starwood, IHG, and United.

One of the coolest features is the slider bar that allows members to choose the mix of miles to cash they want to pay for the hotel or car.

Planet Hollywood Hotel Mirrors JetBlue's All You Can Jet Pass

Thanks for this post go to Author Tom Botts of Hudson Crossing

Over the weekend, we noticed an interesting promotion from the Planet Hollywood Hotel in Las Vegas that reminds us of JetBlue's wildly successful (at least on the PR side) All You Can Jet Pass.

The Planet Hollywood "Phanatic Pass" offers consumers any ten nights between now and March 15th for $599 - in other words, just 59 bucks a night. Whats more, it is even valid during some of the biggest weekends in Vegas such as New Years Eve and Super Bowl Weekend. A quick check of the non-promotional rates shows the Planet Hollywood selling regular rooms for $310 on New Years Eve so the savings are huge if you are (or want to become) a regular in Vegas. What is more, the PH is waiving the resort fee that normally applies (don't get us started on resort fees - they are worthy of another diatribe.)

Obviously, Planet Hollywood is hoping for some breakage on this one, but we like the creativity they are using to generate buzz and interest. And if the goal is to keep customers coming back to the hotel and get them gambling, eating, drinking and hitting the shows etc, this is a pretty cool way of generating repeat business. We bet (as we've seen with hotel loyalty program redemption) that people staying on this deal will have a higher incremental spend than average. The logic goes that people who think they scored a great deal (or used points) on the room will be more inclined to spend on F&B etc.

San Francisco: Cool Tricks: Two English Dudes Row Across North Pacific (Almost) Unsupported

After 190 days and 7,000 miles of rowing a cutting-edge rowboat across the North Atlantic, two British dudes arrived in San Francisco on Friday and promptly drank a couple of beers. The Golden Gate Endeavor, as the journey was called, left Choshi, Japan near Tokyo on Friday, May 8, 2009 and passed under the Golden Gate Bridge on Friday, November 13, 2009. The duo had hoped to be the first to row unsupported between Japan and the U.S., but they ran out of food about 100 miles from the finish and accepted an emergency helicopter drop. That doesn't make the trip any less cool in my book.

This Weekend In The World: Festivals Hit Sydney, San Antonio and Savannah

Sydney
It's the final weekend to catch some large-scale sculpture snuggled up the sandy shores of Bondi Beach up to Tamarama as Sculpture By The Sea ends on Sunday, November 15. Works by over 100 artists sit half-buried in the sand, or perched on rocks, or just chilling in the surf. The best part of making it a day and seeing all of the sculptures, aside from the amazing photographs you can take, is that it's all free. See examples from last year and find out more information at their official website.

Japan Airlines Triggers International Hair-Pulling Fight Among Airlines

We've been telling you for the last few weeks that the three-way Southwest/Jetblue/AirTran turf war happening at Boston-Logan was the most entertaining insidery airline story on the horizon. Now it looks like we may have called that putt a little too early. The international sniping going on between Japan Airlines, American Airlines, Virgin Atlantic, and Delta is beginning to resemble a grade school playground, with back-and-forth insults, foot stomping, and running-to-the-teacher petulance. Awesome.

The background is that JAL is bleeding money and has had to discontinue 8 international and 8 domestic routes. This has put their oneworld alliance with American in a precarious situation. It's obviously not working for JAL and so they've raised the possibility of switching alliances and joining Delta in SkyTeam.

Frequent Flyers On Qantas Can Simply Swipe And Fly In 2010

With the rise of LCC (low cost carrier) airlines and their love affair with new technology, it seems like the airport check-in process is becoming the least time-consuming and easiest portion of catching a flight. There's the touchscreen kiosks, dedicated bag drop counters, and even the ability to check-in and print your boarding pass online.

In Australia however, Qantas is still the gold standard, and luckily they're just as into updating the check-in process as we are. Focusing on cutting check-in time for their domestic passengers in half, Qantas is rehauling their system with the "next generation of check-in."

Hamilton Island: Is Queensland's 'Best Job In The World' Really The Worst?

The now very-well-known tourist board campaign which recruited Ben Southall for the best job in the world —experiencing and blogging about life on the paradise of Hamilton Island in Queensland, Australia —apparently earned the state about $360 million worth of publicity (not bad for a $2.2 million outlay). Now that everyone knows that Queensland is a great place to go thanks to Ben's twitter pictures and blogs, there's one big problem: nobody's going.

Despite the massive interest in Queensland, international tourist numbers dropped by almost 8% over the last year, and almost 14% fewer international business visitors arrived. Of course, the global economic crisis can probably take a fair bit of the blame for that, but Queensland is still worried.

Choice Hotels-Expedia agree to new contract in blink of an eye

After a tiff that went public less than a month ago, Choice Hotels and Expedia Inc. reached a new three-year agreement, which should have the hotel franchisor's properties back on Expedia's and hotels.com's more than 80 websites within a week or so.

And, Choice-affiliated properties that want to participate in Expedia's opaque channel, Hotwire, will be able to do so a later juncture, the companies stated.

From all outward appearances, it looks like Choice Hotels, despite its bluster, is the party that blinked in this skirmish, which seemingly revolved around last-room availability and rate parity.

World's Most Dangerous Airports: Saint Barthélemy

We're still adding to our list of the world's most dangerous airports. Know a stomach dropping, palm sweat inducing airport we should check out? Send it along.

The French island of Saint Barthélemy in the Caribbean might be the winter playground of the rich and famous, but unless you arrive via private yacht or boat charter, all the gobs of money in the world can't save you from enduring the white-knuckled landing on the short airstrip at St. Barth's Gustaf III/St. Jean Airport (SBH).

The concrete runway begins at the base of slight hill, and goes for only 2,100 feet before landing right on St. Jean's beach and the harbor of the island's second largest town. Sunbathers can totally lie out right next to the sand strip at the end of the runway, this it's a hugely popular plane spotting destination for those who enjoy small, prop planes. You see, because of the itty-bitty airport and runway size, major flights must land at the neighboring island of St. Maarten, where they have a big, modern airport. From there, the Barths-bound folks either jump aboard a ferry or hop a WINAIR, Air Caraïbes, and St-Barth Commuter flight in planes usually holding twenty or less passengers.

Hand Over Your Plastic For A Mile High Mojito On Delta

Cashless cabins; they're the popular thing with airlines these days, aside from in-flight WiFi of course. Southwest stopped accepting your Abraham Lincolns for drinks a while ago, and although United and American just jumped on the bandwagon several months ago, we'd have thought that Delta would follow suit faster.

Alack and alas, Delta has just announced that beginning December 1, you'll have to pay by credit card onboard for beverages and more on flights "traveling within North America, including the United States, Canada, Mexico, Central America, Bermuda and the Caribbean." And since they own Northwest now, that goes for NWA flights as well.

So save your greenbacks for drinks at the airport bar, and break out the gold card for Mile High mojitos...where? You guessed it...a mile high.

Related Stories:
· Purchase onboard with plastic, please [Delta Blog]
· Cashless Cabins coverage [Jaunted]

Expedia and Choice Hotels Kiss and Make Up

Thanks for this post go to Author Tom Botts of Hudson Crossing

Expedia (EXPE) and Choice Hotels (CHH) tonight announced they have signed a new, long-term deal that will return Choice's inventory to Expedia's global family of websites including Expedia and Hotels.com. The three year term is even included in the press release but maybe that is standard for a deal negotiated in the press.

More of note, the jointly issued press release begins with a quote from Dara Khosrowshahi, CEO of Expedia Inc, that makes it very clear to anyone wondering about the deeper issues of the dispute (LRA and rate parity as we discussed here) as where the two sides ended up: "We're pleased to be working with Choice in an agreement that respects the guiding principles which we operate under." In other words, Choice agreed to similar terms that everyone else has: coup averted.

Choice Hotels CEO has a line as well but not nearly so telling: "Choice Hotels and Expedia worked together to establish a new agreement that is mutually beneficial and enables hotels in the Choice system to effectively manage their businesses."

Glad this thing is over - relationships negotiated in the press are never positive for either side. A public spat like this does little for the industry (hoteliers or OTAs) and takes the focus away from what everyone should be concentrating on in times like these - generating revenue.

US Airways Rearranges Frequent Flyer Program To Give 'More Flexibility.'

US Airways just published a press release promising customers a new tier system for frequent flier purchases, the promise being that travelers will get "more choices and flexibility." Right now there are three kinds of award bookings you can make using your miles: off-peak, mileage saver, and standard awards. After January 6, 2010 there will be four categories: off-peak, low, medium, and high awards.

Essentially they've taken one of their awards tiers and split it into two. Fair enough. But now they get to rearrange what each rewards ticket costs into a 4-category system, and here's where things get interesting; will they use the new system as a cover for making everything more expensive?

Air Asia Just Put A Million Free Tickets Up For Grabs

Remember when Ryanair threw a hissy fit about bad coverage and "retaliated" by giving away over a million free seats? This new deal from low-cost carrier AsiaAir has going is just like that, rounded down a few thousand seats. Except this the deal opens up a huge vacation window next summer. And it covers over 70 destinations in China, India, Taiwan, Indonesia and Thailand. And you don't have to fly on Ryanair. All things that we are very, very in favor of, but let's hear what they have to say:

AirAsia''s regional commercial head Kathleen Tan said when the economy was tough, people looked for traveling options that offered them better value for money. 'With no fuel surcharge and administration fee, this deal offers fantastic value to our guests'...she said to complement the free flights, AirAsia''s one-stop travel portal was also offering deals and packages including "free rooms" in more than 180 Asia-Pacific hotels online.

Malaysia's Diversity Puts It Into Lonely Planet's Top 10 Destinations For 2010

The latest list for 2010 travel trends put out by the Lonely Planet people says something we've been saying for ages: Malaysia is hot.

With budget long-haul carrier Air Asia X turning Malaysian capital Kuala Lumpur into a hub that's easy and cheap to get to from pretty much everywhere, we knew it wouldn't be long before people woke up to all the great experiences they can find in Malaysia itself.

London: United Airlines Flight Canceled Due To Alleged Drunk Pilot

We know layovers are difficult, and they often drive us to drink. But we're passengers and it's perfectly fine for us to knock back a couple before heading to a middle seat in the back of the plane so long as we keep to ourselves. However, it's definitely not a good idea to have a few adult beverages before the flight if you are the person responsible for flying the airplane. Fortunately for all aboard a United Airlines flight, the pilot was stopped before take off as he allegedly had a little too much to drink.

Over 100 passengers and crew were ready to depart London to head to Chicago aboard Flight 949 yesterday when their flight was abruptly canceled. The cause of the cancellation was due to a pilot who was not fit to fly. The pilot was arrested at London Heathrow Airport and was later released on bail pending the results of alcohol tests. A staff member of United Airlines was purportedly the one that rang the airport police to check things out—good work.

Virgin Atlantic releases iPhone app for people afraid of flying

Virgin Atlantic, the award-winning long-haul airline, today announced its highly acclaimed Flying Without Fear course—with a success rate in excess of 98%—is now available as an app for the iPhone and iPod touch from the App Store—the first of its kind.

Three Ways To Get Value From Your Old Jetblue TrueBlue Points

Welcome to day two of what we're going to begin calling TrueBlue2, the second version of Jetblue's frequent flyer program, now based on money spent on airfare rather than miles flown.

Thus far, the transition appears smooth; the new program appeared on Jetblue's website over the weekend, slightly earlier than the Monday launch we expected. We haven't yet heard of any big snafus with it, only that the points will be harder for flyers to keep track of, since now we're talking thousands of points versus the easy-to-do-the-math tens of points of the old system.

Still, the question remains of what to do with your old points—since TrueBlue1 points cannot be carried into the new system and will continue to expire as usual. Well, there are three options for your old TrueBlue points, and you better get on it now if you've got points lingering...

Google and Microsoft battling to see who can provide the most free Holiday WiFi

When the tech world's two major borgs square off for travelers' time and attention, that can only be good news for the rest of us. Google had already arranged for free WiFi on Virgin America flights and—as of this morning—they're also giving it away at more than 40airports across the country. But that's small time compared to the deal Microsoft just struck to promote their search engine Bing.

Bing has worked out an arrangement with WiFi provider JiWire which will allow users to get free Internet in exchange for doing just one search on Bing. This is a campaign that will reach all of JiWire's hotspots which, more or less, amounts to just about everywhere:

Niagara Falls: New Niagara Airport Has Free WiFi But No Flights

If Pam and Jim's wedding on The Office got you feeling all warm and fuzzy inside, then a new airport wants to help you experience Niagara Falls for all its worth. The Niagara Falls International Airport is almost ready to go as the finishing touches are being completed on the almost $32 million terminal. The place is more than ready for visitors to arrive as the runway and jet bridge are designed to easily accommodate a Boeing 747 —too bad there''s none scheduled to land anytime soon.

The new airport has some of our favorite airport amenities, including free WiFi. However, the best thing going for it is totally free airport parking. You''re welcome to swing your vehicle right up to the front of the airport without the need for any parking ticket, but if you've got a big SUV, you will need to use the adjoining lot because you're just too darn big for the prime parking spots. There''s one problem with the new airport: there won't be too many daily flights once it officially opens on December 11.

Orlando: Disney Installs 200,000 Hand Sanitizers To Preempt Spread Of Swine Flu

The holidays are a big time for Walt Disney World. The parks are transformed into a winter wonderland—well, a fake one as they are in Florida after all—and the guests pour in through the turnstiles. Some days the park has to limit guest access because there are just too many tourists dreaming of a holiday photo with Mickey and friends. All these people are starting to worry some, especially if these people are coughing, sneezing, and leaving their germs all over Space Mountain.

Thankfully, Disney is ready to combat the spread of germs, and is hoping that their efforts will be enough to convince people that their park is safe. After all, the threat of catching that pesky H1N1 flu is kind of a downer and not the stuff dreams are made of. Thus, Disney World has ordered about 200,000 hand sanitizers—although we're wondering why they haven't always had some.

Southwest Gets Its Own Special Slanket Skymall Cover Starring Santa!

Everyone loves SkyMall, the ridiculous shopper's catalog found on flights around the world. We're not sure anyone would actually buy anything featured on these pages but if you forgot your reading material, SkyMall will keep you highly entertained during take-off and landing. (For an analytical look at the products featured in SkyMall, we highly recommend perusing through Gadling's extensive SkyMall Monday posts.)

Yet while we're accustomed to seeing ridiculous things inside the pages of SkyMall, we were shocked to find Southwest Airlines on the COVER of a SkyMall magazine. Even worse, everyone pictured in the Southwest cabin is wearing Slankets. Yes, slankets! But that's not all. Guess who's handing out the slankets? SANTA. Southwest + Slankets + Santa = Serendipitous SkyMall Silliness. And in our opinion, the best in-flight magazine cover of the year.

Texas Cities vs. PCLN, EXPE, OWW et al: A Draw at Best

Thanks for this post go to Author Tom Botts of Hudson Crossing

Late last week, a jury in San Antonio delivered a verdict on a class-action suit against the major OTAs that was brought by around 170 cities in Texas. The verdict against Expedia, Orbitz, Travelocity and Priceline is for $20M plus court imposed penalties and interest.

While this sounds dire, (and if you read the lawyers press release you would think this was a slam-dunk) a detailed analysis beyond the headlines should give the edge to the OTAs. Why?

First of all, the jury rejected the municipalities' claims that the OTAs willfully pocketed tax dollars that were collected (as taxes) from consumers. This precedent setting verdict finally makes it clear, once and for all, that the OTAs are not collecting taxes and pocketing it - a position that many of the other lawsuits have taken and one that was sure to ring true with juries, particularly in this day and age. The "tax and pocket" position was a highly emotional stance that anyone who truly understand the true economics of the merchant model would obviously reject. Yes, taxes and fees have long been bundled together but the spirit and goal was clearly not to defraud consumers or rob cities and towns of tax dollars - the intent was to protect the underlying contractual agreements around margins.

Secondly, the jury rejected punitive damages against the OTAs because they agreed that the OTAs were not, in fact, pocketing tax revenues. Obviously, this is a no-brainer.

Interestingly, the jury did find that the OTAs "control hotels" and therefore are required to remit the occupancy taxes required by hotel operators. Knowing more than a few hotel General Managers, I can't imagine a statement that would boil their blood faster (except, maybe to say that "corporate" controlled their house!) than to say an OTA controlled the hotel. By now, everyone knows that hotels set pricing, inventory, discounts and room allocations either on the fly or during negotiations with the OTAs. The OTAs then re-market those rooms that have been offered to them to sell. This is hardly control. Furthermore, the hotel is clearly in control of the guest experience - after all, it is the hotel that decides which rooms to allocate to specific guests and who to "walk" when things go wrong.

Lastly, we believe the jury's definition of "control" may expand well beyond the OTAs. Put in the context of the ruling, traditional tour operators control rooms as well. Traditional tour operators (which pump a lot of rooms into Texas resort cities) have always paid the occupancy taxes based on the net rate of the room, not the gross selling rate. This has been going on long before the Internet and the OTAs came along.

Bottom line: if Expedia and the like are hiring, firing, allocating capital, negotiating with unions, customers, franchisers and managing to get the beds made and the bacon crisp, we'd agree that they control the hotel. Last I checked, these functions were not part of the OTA business model.

Florida AG sues Expedia and Orbitz - If cities can, we can too

Thanks for this post go to Author Tom Botts of Hudson Crossing

Bill McCollum, the Florida Attorney General filed suit against Expedia and Orbitz this afternoon, opening the next chapter in the ongoing fight over occupancy taxes. Florida is the first state to take such a step - all of the previous actions have been filed by cities or groups of cities in a specific state.

It is not clear why the suit was only filed against Expedia and Orbitz - in the past these actions have usually been taken against all of the major OTAs including Priceline and Travelocity, among others.

In reading the actual complaint, there does seem to be some confusion in how the merchant model actually works.

For example, in Section 9: "each Defendant purchases and receives inventories of hotel rooms at negotiated rates from the hotels." and "re-sells the rooms to consumers at rates determined by that particular Defendant." Lets take a look at these two statements. Does Expedia, in most cases anyway, actually purchase a block of rooms and hold the inventory? No, not since the early days of Hotels.com - most, if not all, rooms are not purchased and held in advance. As far as determining the rates paid by consumers, again, certainly in the case of the chain hotels, the OTAs are not setting the prices - the chains are through their contractual agreements.

The AG claims that the OTAs are using a "purchase and resale" model which just isn't the case.

The big issue is that the model roughly described by the AG has been in place long before the Internet came around - how do they think all those rooms at Disney World are filled? Thousands of rooms are sold every night in Florida under the wholesale model - I bet more than in any other state in the country except for maybe Nevada. These wholesalers also remit the taxes back to the state based on the wholesale or net portion of the room rate, not on what the consumer actually paid for their package which may include Disney tickets and plenty of other things also bought on a wholesale basis.

Expedia Billboard Effect: Cornell agrees that it is real

Thanks for this post go to Author Tom Botts of Hudson Crossing

Expedia and other OTAs have long touted what has become known in the industry as "the billboard effect" whereby they have claimed that positioning on their sites generates not only bookings through the OTA but also a halo effect on the hotels' own sites by generating brand awareness. Non-loyal consumers start many of their searches at an OTA to gain a perspective on the options available, relative costs and positioning of the hotels in a given market against one another. Then, they often check other sites to compare pricing - usually including the website of the hotel they are interested in.

Personally, I saw strong evidence of the billboard effect while I was at Starwood and Expedia has long claimed that for every booking generated on Expedia, another booking is generated on the hotel's own website.

In a new whitepaper, Cornell assistant professor Chris Anderson has measured the billboard effect with a several branded and unbranded hotels. The results are striking, particularly for the independent hotel in the test.

For the study, Prof. Anderson worked with Expedia and JHM Hotels, an ownership group with hotels under the Starwood, Marriott, Hyatt and Hilton flags to cycle specific hotels on and off of Expedia over a three month period. That is, the hotel was listed at the top of the search results when the hotel was participating on Expedia and and removed altogether from search results listings when the hotel was dark on Expedia. By the conclusion of the study, each hotel was listed on Expedia for 40 days and dark for 40 days.

The results are below:

According to the study, the hotels saw a boost in reservations ranging from 7.5% to as much as 26% for the inde hotel when they were listed on Expedia vs. when they were dark.

Prof. Anderson suggests that the branded hotels may not have seen as large of a boost because when consumers go the brand websites they are presented with other "in-chain" hotels, e.g they are searching for a Marriott but upon arriving at marriott.com they are presented not only with the Marriott they saw on Expedia but also a Courtyard where they may actually end up booking.

We'd like to see an expanded test at some point with some slightly different parameters. For example, what happens if the hotel isn't listed at the top of the search results on Expedia? Could the brand numbers be further refined if the test was conducted in markets without sister hotels nearby? What would the results look like for resort hotels? How did the booking curves differ? And the cancellation rates? Could leveraging the billboard effect actually be cheaper than buying google key words? And of, course, what do the bottom line ROIs look like after all distribution costs are taken into account. Those questions may be ripe for another study - any of you OTAs or chains reading ready to sign up? Lets talk....

Expedia drops phone booking fees

Thanks for this post go to Author Tom Botts of Hudson Crossing

Expedia announced today that they are removing booking/service fees on all travel products sold through Expedia's call centers.

From an airline perspective, the move is interesting in that it will now be cheaper for consumers to book with an OTA then calling the carrier directly. (Except, of course, for Southwest which does not charge extra for a call center booking but they don't participate in the OTAs anyway.) The move is another example of how the OTAs have continued to differentiate themselves from the suppliers in terms of service, functionality and price. The list of enhancements the OTAs have made this year is long and compelling and great for consumers. Just to tick off a few: Orbitz TLC, Orbitz Price Assurance, Expedia's SeatGuru reviews, Priceline's iPhone app all come to mind.

And what of the timing, by the way? Interesting that Expedia announced this change the same morning as Orbitz announced earnings - particularly when Orbitz had this say in their statement: "This net revenue decline was due primarily to the removal of most air booking fees and the significant reduction of hotel booking fees on the company's domestic websites, as well as a decline in average hotel room rates globally."

Today's move by Expedia along with the OTAs' other enhancements this year should be a wake-up call for suppliers - Airlines and hoteliers cannot continue to sit still while they are out-innovated by the distributors. Piling on more fees or other dis-incentives for booking through specific channels only further harms the supplier's brand and the overall customer experience. Suppliers, wake up!

Priceline Negotiator Trades Phasers for an iPhone

Thanks for this post go to Author Tom Botts of Hudson Crossing

Priceline.com launched a cool new iPhone application today that not only functions well but is also really fun. Finally, a great app from an established company that also has some whimsy. Priceline is obviously serious about mobile bookings but isn't taking themselves too seriously with this app - we like that.

Most importantly, this isn't just a re-skin of the regular Priceline website crammed down to fit on a small screen - The Negotiator app is actually a different experience tailored for the iPhone and a fun one at that - the music between the screens adds to the fun.

Most fun is the "shake down" feature which leverages the iPhone's location functionality to display winning bids nearby. Shake your iPhone and see what your options are - perfect for last minute bookings and much more useful than a randomized restaurant listing!

It is also easy to toggle between "Name Your Own Price" hotels and regular, published hotels through a tabs at the bottom of the screen labeled "Negotiate" or "Browse." When "negotiating," the app allows users to perform Priceline bidding functions with some nice touches for choosing your bid amount like a recommended price to bid, and a slider to increase or decrease the bid with great tag lines like "See if you can bag this deal, too!"

And because you can book up until 11PM for same day arrival, we bet more than a few travellers who find themselves stuck in a city for whatever reason (you can think of a few, I'm sure) will love this app. Priceline has long allowed for same-day bookings but firing up your laptop for a last minute room isn't exactly a lot of fun - Priceline has created an elegant and fun solution.

FlightSearch.com - Official Beta Launch Announcement!

We are excited to announce the official beta launch of Flightsearch.com!

Who are we? A group of travel industry veterans who wanted to create a better search engine for finding the cheapest travel deals from around the globe.

What makes this site launch "beta"? As with most new sites, launching in beta mode gives us a good opportunity to address any hiccups our site may experience out the gate, but while we do, we wanted to give a few of our friends a sneak peek at where Flightsearch.com is heading! In addition, we are in the process of adding new travel partners and features everyday so check out www.flightsearch.com today, tomorrow, next week, etc. Chances are you will see something new and exciting each time.

What should I do now? Go ahead, use the site! Make your Holiday travel plans through www.flightsearch.com! In fact, make it the last site you visit before you book your trip.

Feedback? As part of our select group of friends, I'd like to personally solicit your feedback, suggestions, or comments in an effort to create the best user experience when searching for travel online. Send comments directly to feedback@flightsearch.com

Safe travels,
Ted

Ted Perlstein

Managing Partner

FlightSearch.com