Tripharbor.com and Tripharbour.ca are both live as of last night. Initial response is very postive. See more over on the Tripharbor blog.

What a great feeling...

I know that I've been pretty quiet over here of late, especially given all the fun and games in the travel sector (a raft of carrier failures, Transat ups and downs, FAA oversight pendulum swings, Royal Caribbean stock rating dropped to junk etc.). But I have been blogging at the shiny Tripharbor.com blog, and generally keeping very busy with work on our new business.

Be sure to check out over there.

Just happened across this:

"TripAdvisor also recently announced the acquisition of smartertravel.com, bookingbuddy.com; SeatGuru.com; TravelPod.com; and Travel-Library.com. TripAdvisor also recently announced the acquisition of smartertravel.com, bookingbuddy.com; SeatGuru.com; TravelPod.com; and Travel-Library.com"

Wow. They're buying everybody that could control consideration and reach at the very early stages of travel planning. Not a bad idea, as long as you don't prostitute yourself (as TripAdvisor itself has done, in my opinion). Keeps the cost of reach down in the long haul, and keeps them from being meaningful sources for suppliers.

Neat to see TravelPod in there - they are an Ottawa-area based travel blog roll-up site.

Congrats to former Hotwire (Expedia-purchased) colleague Gregg Brockway on the launch of TripIt.com (http://www.tripit.com) at the TechCrunch40 event happening this week in California.

TripIt is a kind of pull-it-together travel itinerary tool, whereby you can make reservations in multiple locations and still end up with a single itinerary. In Gregg's words:

"TripIt helps you organize your travel plans. You simply forward all your travel confirmation emails to TripIt and we automatically create a master itinerary with your combined plans plus daily weather, local maps, directions and more. Then you can expand your master itinerary and share it with your friends"

It's not hard to see other possible revenue sources via affiliate relationships, meta search or advertising. As more of the US market's vanilla air / hotel / car business continues to move from third parties to suppliers, this type of a service starts to make a lot of sense.

(via BlackBerry)

Hardly shocking to read that IAC-controlled Expedia is possibly looking to buy-back $3.5 billion in stock or up to 42% of the company at an offer of $30/share. The Financial Times also reports that there are rumours the company may spin out it’s TripAdvisor unit and eliminate up to 400 positions. In an odd turn, given that they don’t normally comment about such things, the company has denied these rumours.

Given that Expedia’s domestic growth has essentially stopped (1% revenue increase in Q1) and it’s international growth is underwhelming (25% growth looks fine, but it’s a far cry from the triple-digit stuff of not-too-long ago and on a small base, to boot) you can easily see why it’s valuation might be under scrutiny.

Layer in the fact that the only real share price growth Expedia has seen since it was spun out the second time, about two years ago, appears to have been the last stock buy-back, and that IAC’s principle investor and Diller’s friend John Malone’s Liberty Media might well be wondering where their money is, and you can easily see why another buy-back might be in the cards.

Finally, the pressure on the model itself is intense. Strong competition from Travelocity,Orbitz and other third party players, the growing power of suppliers who want to control their distribution, the rise of meta-search tools like Kayak and SideStep, plus overall category maturation and you don’t have to squint too hard to see why getting the price up and getting out of Dodge might work out just fine.

UPDATE: Expedia has issued a release confirming this buy-back. However, this quote from Diller is beyond my ability to wrap my head around:

"With this action, we couldn't be clearer that the management and the Board of this company are confident in the value of Expedia and in its long term future," said Barry Diller, Expedia, Inc.'s Chairman and Senior Executive."

I guess maybe I'm just slow...

Congratulations to my former Expedia Europe colleagues on the launch of TVTrip.com, a bilingual (so far) video rich travel comparison site. The team, including Marc Ruff - former head of Expedia France, Anja Keckeisen - former head of Expedia Germany, and Fabien Bourdier - Marc's Number Two at Expedia France, are some my favourite, and among the most talented, members of the original Expedia team (I actually interviewed Marc and Fabien Back In The Day), so I am very pleased to see them getting back in the saddle.

More comment about the service itself once I have had a chance to spend more time with it. It looks pretty solid from a content perspective for a beta, though. They have been busy.

I don't know why I'm noticing more travel related stuff these days, but I am. This one caught my eye, from The Canadian Travel Press, a travel industry publication, with a primarily retail travel agent readership. The piece asks several travel agents across Canada the following question (and for the record, I am a huge fan of traditional travel agents, and think that the good ones are worth their weight in gold). Here is the question and one very telling answer:

Q: Do you believe that Internet booking companies like Expedia are cutting into your business significantly?

A: "I know we [travel agents] lose sales. It's a problem, but what can we do?"

- Suzanne Goyer, Suzanne Goyer Travel, Montreal

Well. I'm just not going to say anything further. That quote alone speaks volumes in many, many ways.

I share a few thoughts about WestJet's challenge to expand distribution in the US, and add new routes. The story is here.

The Star Alliance comment is true, but the real issues are deeper than what the reporter was able to fit into the story.

Firstly, the real strength of Star Alliance for Air Canada on transborder is the United codeshare, which ensures that US originating passengers flying to Canada see Air Canada flights, since they carry usually carry a United flight number. Same with US Airways (which includes the former America West now, too). This is huge, because it guarantees visibility (albeit under another name) for these services in a market where Air Canada is not well known, ties in to other connecting flights providing additional source passengers, and gives points on the other airline's loyalty program.

Secondly, WestJet's challenge isn't just in securing interline and codeshare partners (to provide valuable inbound connecting passengers, and allow it to feed same on the outbound) but in talking to and working with them. As a low cost carrier model, WestJet has had a mostly closed system in which they operate the airline and distribute their seats. I hear that they have tried to make a change to use technology provided by Travelport, which I have been told has been a real mess (if true, I'm far from surprised. Travelport has been a major disapointment almost since it's inception). Working with other carriers and other distributors means more technology investment and increased pain of "participation" in various platforms used to sell airline tickets, all of which complicates the WestJet model. Plus, they end up having to pay all the various parties for this distribution, much like full service carriers do, reducing their overall yield per ticket sold. This is as opposed to carriers like Ryanair who simply don't use any distribution and keep costs low and control in-house.

A smaller issue is that WestJet doesn't offer a First or Business Class service, which makes it harder for it to offer interline, or connecting, services to Asian or European carriers who do.

The real question, for me, is why WestJet seems hell-bent on going the full-service-type distribution route. They need to expand, sure, but this way of distributing their product adds cost and reduces control, especially in a world of increasing online distribution where the suppliers should hold the cards.

I certainly wouldn't be going that way. But that's just me :)

Great piece here.

My view: they underestimate the "commerce" part by a long shot. TripAdvisor jumped the shark eons ago; it's a store pure and simple at this point, lipstick or not.

But still a good story and they are still the most successful example of monetizing community this side of eBay.

(posted on the train via wifi)

My one-time alma-mater, First Choice Holidays PLC - the parent of Signature Vacations - is merging with the massive German based TUI to form an even more massive travel cencern. This seems like a win for all. First Choice needed a tie up, their management team is solid, and consolidation in the leisure travel world isn't likely to slow down anytime soon.

Now, if they can only get that internet thing to go away, everybody can be happy :)

The Economist has a quick, solid piece covering the increasing fortunes of the old-school US commercial airline business. In short, the US$35 *billion* they have lost over the past five years (yes, you read that right) seems to have finally, possibly, just maybe, driven them to gain a closer to competitive and cost-based footing with the upstart and low-cost carriers.It also mentions JetBlue's recent challenges, including a loss making Q3 and resulting equipment sales, which I had not been aware of.

Always fun in the airline business, isn't it? I can only imagine how challenging it must be for third-party guys like ExpediOrbiLocity and others to be earning any appreciable compensation from those carriers these days, given the carriers' improving fortunes, search and metasearch (more on that in a future post - lots of action in that world), fenced inventory and CRS changes moving more power and money into their camp.

It might still be the milk at the back of the store and responsible for driving a lot of cross-sellable traffic, but increasingly the third party guys have to be looking at the air category itself in terms of revenue from booking fees and very little else. Everybody knew it was coming - it now must be close to here.

More later, but this is great news for Cendant and bad news for Blackstone. Online 3rd party sites and associated plumbing aren't coming back any time soon.

Update: The potential for Cendant in the travel space had always been that the synergies of having a vertically integrated entity - like a European style tour operator - would pay off. By combining a host of suppliers (Avis, Budget, Wyndham, Ramada, Super 8, Travelodge) and the plumbing to distribute them (the Apollo CRS, Orbitz, CheapTickets.com and even trip.com before them) costs would be reduced and margins fattened up and down the chain. Sadly, that just never happened.

With this breakup and the creation of a pure distribution arm, any hope of that seems out the window. Of course, CRSs and online resellers aren't going away anytime soon, but there sure is every indication that they are struggling to stave off declines in growth and margins.

I guess the good people at Blackstone can see something I don't, or they have other plans. Or perhaps just wringing more cost out means that this can spin out a nice enough ongoing income annuity through the decline that they are fine with it.

But it sure isn't a growth play.


Tags: orbitz, travelport, blackstone, cendant

Congrats to the Farecast gang for moving out of private to public beta today. Though, with mentions on TechCrunch and BoingBoing, among others, it's not like my little heads-up here matters. That's some serious b-sphere coverage. Nicely done Mike and team.

Now their challenge is to prove that the whiz-bang, P.R.-friendly airfare predictor feature is more than the flavour-of-the-month, and to continue to build on the solid start of their metasearch tool. Oh, and to move into hotels because that's where the cash is. No small task.

Tags: farecast

As I mentioned here, TripHub is a new Seattle-based online travel startup which includes some former Expedia colleagues of mine, and at least one Expedia + msn Travel Channel veteran. Off the top, I offer kudos to all of them for tackling something new, and extra kudos for taking on the very difficult task of helping people manage the tremendously ungainly world of group travel.

As you might take from the last sentence, I went into my tire kick of the site with fairly low expectations. Not because these aren't bright folks, but because group travel is really hard to do. As it turns out, my expectations were probably well placed - at least partially.  This is a pretty good invitations-and-central-repository-like-Evite meets private-label-Hotels.com site, but as a real group travel management tool, they still fall short.

Now, the Evite-esque invitation and central trip record thing is a cool tool. If you have ever used Evite to invite people to a party or event, you can probably imagine applying that concept to multi-person trip planning. Pretty handy. And, they have a private label deal with the Hotels.com/TravelNow crew (all part of the Expedia group of companies) and Viator for activities, which from a revenue perspective should drive affiliate revenue for them. But, from a user perspective, beyond the Evite-esque thing, they don't seem to offer much in terms of true group travel planning assistance.

What do I mean by that? Well, "group travel" is really about people going as a group of more than X people (depending on the supplier) and saving money. Fact is, this functionality is very, very hard to offer online. There are a lot of reasons for that which I won't go into, but more to the point, it does not seem that TripHub has pushed that envelope any further.

To their credit, they do link to group request pages on various supplier sites, as well as promoting "featured links" to these types of pages, so and it looks like they are likely getting some kind of payment for the referral and ad revenue for the features, which is good for them in terms of revenue. But short of aggregating the links, there's little user value there.

The flight search is nothing special - it's a straight-up pass through to the TravelNow IAN platform, and only searches for a maximum of 6 passengers (there's one of those hard group travel planning problems - this is a limitation imposed by the CRS). For true "group" deals, you have to go to the airline's own group booking sites, and then input the details back into TripHub manually. Likewise for the hotel portion: there is certainly no new ground being broken in terms of the search functionality itself (eg: there is no meta search or breakthrough-anything here; it's just vanilla private label Hotels.com). In fact, TripHub offers nothing which makes hotel seeking "groups" easier to book or price multiple rooms at once.

Net/net: while the Evite-esque feature is pretty neat-o, as a real travel planning service and aid to group travel, TripHub doesn't get the job done.

Update: I had a chat with Michael McGinn, TripHub's CFO and Operations guy this afternoon. Michael also happens to be a former colleague, a former Expedia Strategic Planning VP and long time air industry guy. He's also one smart cookie to boot. Michael talked with me about their desire to use solving the problem of people travelling together as a way to get people to keep coming back and build an ongoing audience for advertisers. He stressed that the traditional travel industry idea of "group travel" being about deals is not at the core of what they are offering, and I have to agree that making the prospect of "going together" easier is a good good one. As I said above.

All that said, and with great respect to Michael and the team, I still can't imagine that what they have today is where they are going to end up. It just shouldn't be. Group travel is a big business, and making it truly better in a big way is a nice, chewy, defensible objective. My hope is that, regardless of what they are saying at this point, they do have cracking that big problem as the ultimate goal. Now *that* would be cool.

Tags: triphub

...these things, which I will dive into more later.

1. Is it the end of the beginning or the beginning of the end? With all the people jumping off to "do their own things" (Tara, Scoble, Om) it sure feels like one of those.

2. Some other former Expedia folks are a part of a team which has launched a group travel site called TripHub. I am going to check it out and report back.

3. A good friend and the former President of Expedia Corporate Travel, Matt Hulett, is now doing a shopping start-up called Mpire. Another one to check out and report on.

4. There are a lot of Canadian online travel sites starting to advertise. I was driving along and heard 3 radio jingles in a row. Great that they are promoting themselves. But too bad they still suck.

Tags: tara, om, scoble, triphub, mpire

Farecast, a Seattle-based travel start-up, is in private beta. I was invited to try it out, and I did. On the whole, it's pretty good - but I am fearful that beyond the relatively small amount of whiz-bang buzz their "hook" adds, they are really just another meta-search site. Albeit a clean and well-designed one.

Their "hook" is that they claim to be able to predict what will happen with fares, thereby providing customer value by guiding when someone should buy to maximize their fare savings. Pretty cool on the face of it, and the visual presentation is also pretty neat. But does it really add a lot of value? I think it's a snappy feature and no doubt the algorithm is impressive, but will it pull them in and keep them? I'm unconvinced.

Beyond that, the site is clean, nice and ajax-y and the search display is easy to interpret. But I can't say that it is orders of magnitude better than any other meta-sites, or say Orbitz's grid for instance.

Another unfortunate negative (mentioned by Michael Arrington in his post) is that, despite pulling schedule info from Southwest and JetBlue, they don't pull pricing info into the initial fare display. This is a pity, as it pushes those options to the bottom of the display and potentially skews the prices listed. Said another way, if one of those carriers offered the lowest price, you'd never know it and the prices shown as lowest might be wrong simply because they aren't shown. But Southwest has a longstanding history of not allowing their fares to show in an aggregated display (possibly because head-to-head they frequently don't compare as well as people might expect) so Farecast getting this access would be quite a coup - and one they haven't managed as yet.

Net/net: The predictor is a nice little whiz-bang feature that has some PR value, but essentially Farecast is just another meta-search entry in what is becoming a crowded market.

Update: TechDirt says that if it casts light on airline pricing, it will have value. Maybe at the highest or industry level, but adding stress to travellers lives by telling them to wait before they buy won't necessarily make their lives better. And how are the carriers going to feel about a site that drives them to lower yields?

Update 2: The folks at Farecast gave me 25 invites to share with others who might like to kick the tires, too. If you'd like one, let me know here or at stuart [at] stuartmacdonald [dot] ca.

Thanks Mike - another Expedia alum - for the invite.

Tags: farecast, travel, metasearch

Profit fell by 51% and the stock tumbled after hours.

What to say? Well...

1. Not a shocker. Anybody looking at public reach numbers on the US business could tell they did not pull in their typical Q1 "pop". If people don't come, they can't buy.

2. They appear to be spending like drunken sailors.

3. Their recent ad campaign appears to have failed miserably (to wit: their Price Guarantee, which they can't really offer because they don't control the price, and worse yet customers neither believe nor care about). Or they cut spend dramatically, or both.

4. I've heard that something like 50% of Expedia Bellevue employees are new in the past 18 months. Virtually all of the senior team are new.

5. They continue to look at international growth for their future, but suppliers getting smarter and the rise of paid search must be making it harder to stake a claim.

6. Margins must be under serious pressure, as suppliers try to reduce distribution costs and reliance on third parties.

That said, my call is that the Canadian business is likely still doing okay, and I feel good about that.

The rest? Ouch.

Tags: expedia, q1

All great that Google is set to make a bunch of big announcements at their Press Day next week, and there is certainly much chatter about a big Health play. Though in fairness, some like mesh Keynoter Kedrosky are calling for a ban on new Google products until they get the ones they already have in prime-time shape.

But nobody is talking about Travel. I don't get it. Huge category, big dollars, obvious play, and yet zero discussion.

Odd, no?

Tags: google, travel, troogle

Sorry, had to post this snippet from a SideStep press release this afternoon:

"SideStep, Inc. (www.sidestep.com), the Web's leading travel search engine..."

Well, hey, adding activities - which they just did - might be super-dee-duper and all as Brian says, but, um, Rob, you better gimme a puff of that when you are done, and then go check your reach numbers. It's clearly making you kids light-headed.

Tags: sidestep, travel

Dude has quite the itinerary, and is sharing his commentary around his experiences getting the travel arranged.

Apparently it can be a confusing and aggravating process, and you can't be sure that you are getting the best deal or a complete view of everything that's available right away.

GASP! Who knew? :-)

Tags: travel

I've thought a lot about Google taking a serious run at the Travel category over the past few years. Mostly because that's part of what I was paid to do, and also because it makes a lot of sense. So I was interested to see Mathew Ingram's piece in today's Globe and Mail (which seems to have spun out of this blog posting) where he talks at length about the prospect. For the most part, I think he got it right.

For one thing, Google certainly has designs on being a portal, if their recent moves with Finance and Real Estate are any indication. Beyond that, their competitors are already there in Travel, sorta, with Yahoo!FareChase leading the way and msn Travel (in typical Microsoft fashion) representing a half-step towards a fully integrated travel "thing". As well, there is a lot of money at play, both from an ad and a distribution cost perspective, and they have reason to want to maximize it. Finally, if they have been nervous about upsetting the ad-revenue apple cart in the travel category (huge numbers) that nervousness has likely been reduced by things like IAC's purchase of Ask.com. IAC maintains a controlling interest in Expedia, and with this purchase is both a big customer of, and a direct competitor to, Google.

However, I think that there is a big difference between Google ramping up their travel "experience" and them actually fully taking on the OTAs. In terms of them having some multi-site search experience and sending traffic from that to an OTA or a supplier (airline, hotel etc.). that seems like a pretty obvious thing. Suppliers would love it, and the competitive gauntlet has already been thrown down.

But actually selling travel? Yikes. Why would they? Call centres, rules and regs, etc. etc. Easier to just further solidify their role as gate-keeper, and take advantage of the lack of loyalty and brand meaning that these guys have to crank out the ad money.

Also, worth noting that most of this applies less here in Canada. For a bunch of reasons, the OTA and Supplier landscape is different and it is less likely that the existing dominant players here (Expedia.ca, AirCanada.com and WestJet.com) would suffer or benefit much from such a move by Google. Why? Well, the competition is lighter here, they often have exclusive inventory, offer pricing of global inventory in Canadian dollars, work better and have brand meaning that brings a lot of business direct.

Technorati tags: google, yahoo, travel, expedia, travelocity, orbitz, aircanada, westjet

We are back from our quick trip to Nova Scotia with the girls, and I said I'd let you know how the car rental from Priceline.com worked out. Well, as much as the sentimental me would like to say it was lousy, I can't. It was flawless, including us receiving an upgrade to a Ford Escape SUV.

The only issue was that when we got back to the airport for our very-early departure this morning, neither the gas station on the way in nor the Hertz counter were open, so I had to drop the keys and leave the truck with the tank half-empty. We will have to see what ultimately hits the credit card, but as I sit here today, I am a very satisfied customer.

Technorati tags: priceline, travel

News today on the Yahoo! blog of the new-and-improved Yahoo! FareChase. I just checked it out and have one word: Wow.

The hotel integration is tremendous. They are pulling from snazzy tools like Flickr and various user generated reviews, are shoveling reach to multiple possible sellers, snapping in some very cool satellite imagery, and are even managing to maintain good integration with their legacy "partner," Travelocity. Lots more revenue potential for Yahoo!, more selling opportunities for others including the supplier, and a richer customer experience. A win all around.

So, where oh where is Troogle? Calling Mountainview! Jane? Hello?

More discussion here and here.

Tags: yahoo, yahoo farechase, travelocity, google

I took the car today for the first time in a long time, and ended up driving westbound on the Gardiner. Big news! Looks like Travelocity.ca has changed their mega-billboard down there. And now? It's almost legible! You can almost make out the name, barely read the scrolling text, and marvel at that stupid frickin' gnome  there, bigger than life. Stupid, stupid, awful, supremely-poorly-testing, ugly, obnoxious gnome.

At the exact same time I am passed by one of the gorgeous Expedia.ca buses, in all it's completely perfect, screaming yellow, crisp, clear, made-in-Canada, right-in-context, plane-and-globe branding glory.

It was one of those moments when you just sorta "get" why, in Canada, Expedia won and Travelocity lost. And soooo badly, to boot. With due respect to Sam, Michelle, and the rest of the Sabre crew in Dallas, they just pooched it royally  up here. It was theirs to lose, and they did.

And yeah, I'm biased. Proud of it. But that doesn't mean I'm wrong.

Technorati tags: travelocity, expedia, online travel, travel, gnome

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It really isn't my plan to talk about only online travel here, but this post on The Internet Stock Blog caught my eye.

Seems Stifel Nicolaus analyst Scott Devitt downgraded Expedia Inc. (NASDAQ: EXPE) to “Hold” yesterday, due, among other things, his view that there is a revenue risk associated with their Worldspan CRS deal.

Now, going into detail around the arcane and obtuse workings of CRS agreements, kick-backs, regulations and money flows just isn't going to happen here. But, broadly speaking, is the reduction in CRS revenue, and conversely cost associated with direct-connect a real issue and challenge for any online player, especially one reliant on another party for said revenues?

Damn right it is.

Technorati tags: expedia

Somebody check the weather, because it could be that Hell has frozen over. Why? Well, I just made my first purchase on Priceline.com - and I am feeling pretty good about it. Now, as the guy who wrote the business plan for Expedia.ca and then was Chief Marketing Officer for Expedia.com, that's pretty scary stuff.

Here's the deal. We are heading to Halifax for Easter with the Grandparents, and as such need flights and a car. Well, for flights we had pretty specific requirements, so we went the traditional route (which in this case meant booking directly at AirCanada.com because it was $600 cheaper than on Expedia or anywhere else, but in fairness that's not always the case. Frequently, the online agencies have better deals, depending in when and where you travel - just not this time). We don't need a hotel, but do need a car. I went to Expedia.ca, Travelocity.ca, Hotwire.com (an "opaque" or you-don't-know-what-you've-bought-until-you-buy-it part of the Expedia family) and finally, to Priceline.com.

With due respect to my friends in the business, when you are picking a rental car up at an airport for a leisure trip, a rental is a rental. Though I do value the service bells and whistles when I am on business, when I travel on my own dime I will gladly trade a little convenience for savings. And for an airport pickup, you know who the choices might be, so what's the big fear?

So, in a nutshell? Priceline beat the pants off of everybody else. By a mile. And they have a neat little tool that guides your bid into likely-to-be-accepted territory. And I ended up getting the car from Hertz.

So, what will happen when I get there? Will it all be awful? Will I regret having done this? Will I hate William Shatner more than I do now?

We shall see. I will provide a full report when I get back.

Technorati tags: priceline, expedia, travelocity, online travel, william shatner

News today the WestJet has entered the Canadian pre-paid air pass fray, in the wake of Air Canada launching a major push for their smorgasbord of passes, which have actually been around for a while now. Lot's of coverage of these moves over the last while, especially since it marks AC's first big advertising push in many years, and the first move into this space for WS.

But hold up for juuuuust a second. Despite all the gushy commentary, it's not like this idea is new. Hardly. It's been around for as long as airline bankruptcy (read: a long time). But in this case, that actually doesn't make it a bad idea.

But first, a brief walk down memory lane. Passes are a tried and true, though usually last-ditch, airline sales tactic. Some might recall how Royal Airlines went nuts selling passes just before they went out of business. Sad fact is, over the years many carriers in trouble have offered deep discounts to buyers who were willing to pay-now / fly-later, in order to add much-needed cash to their coffers. Sadly, in some cases, this effort amounted to little more than a short-term revenue infusion on the road to business failure.

Not to say that's what is happening here. In fact, in this case, this is a really smart move on the part of both AC and WS. Why? Well, it kills multiple birds with one stone. To wit:

1)     They get the revenue now. This is good.

2)     They get "breakage," or segments bought and not used. This is VERY good as it represents pure margin.

3)     The passes can only be accessed and reserved-against online at the airline's own sites. While they can be                 *purchased* from offline agents, the traveller needs to go to the carriers' site to book them, and they are not             available via online agents. This is GREAT for the carriers, who, like most travel sellers, are anxious to pull             business direct and see ring-fencing inventory as key. Given that most online sites don't get access to the                 lowest airline fares already, this just makes that problem worse.

4)     Their costs are much less. Having customers make the bookings online-direct reduces sales commissions and         CRS (reservations system) fees.

5)     They make it harder for travellers to compare alternatives, especially on US routes. If travellers buy passes in         advance for travel to the States, they are less likely to check other carrier alternatives (which most do via                 online agency sites), which may be less expensive or more convenient.

6)     For WestJet, offering a super discount on Eastern Triangle flights (Toronto/Ottawa/Montreal) enables them to         pre-buy market share, without putting a low-ball price out in the open market.

Another interesting thing about WS' move is that they raised the bar by making their passes transferable. So, it seems that a company could buy a bunch and use them for multiple travellers. Or, a family could buy them and dole them out to kids attending university in another city or to Grandparents to come in for a visit. This has definite appeal. It will be interesting to see if AC follows.

All in, this pass war raises the bar in the battle not just between the carriers themselves, but between the carriers and their online distributors.

Game on.

Technorati Tags: air canada, westjet, online travel, travel

Well it bloody well took them long enough. After, what, five-ish years and a rumoured $50 million, Air Canada's little dotcom pipe-dream-in-the-sky is no more. Destina.ca was to be Canada's answer to Orbitz - an airline-owned online travel service for everything in travel, selling not just Air Canada but other carriers as well as hotels, car rentals etc. Theory went, back in the heady days of dotcom mania V1, that they would Rule The World, or at least have real skin in the Canadian online travel game, and then be spun off for untold millions in IPO manna.

Riiiiight.

Well, let's recap, shall we? The site sucked, WestJet wouldn't give them inventory, the marketing was abyssmal, they relied on points-hounds for most of their business, much of their inventory came from competitors, and - oh ya - September 11th took the wind out of AC's sails, just a wee bit (CCAA, anyone? Ringing a bell?).

In some ways it's a shame.Well, for their competitors, anyway. Maintaining some effort on that piece on online silliness meant they diverted some of their under-powered-and-financially-limited-to-begin-with focus from AirCanada.com in order to keep it on life support. Seems like that is finally over.

Technorati tags: air canada, westjet, online travel, travel, orbitz