Expedia has announced it will put an end to airline booking fees for good. Do I believe them? No way!
It looks like with a combination of a poor economy and less people traveling, mixed with plain old competition has brought all four of the top travel booking websites to waive airline fees permanently. Yesterday Orbitz.com announced it was removing all airline ticket booking fees on domestic and international flights. Travelocity said the same thing as well yesterday (coincidence?). Both of those websites just so happen to break this news upon hearing that Expedia said the same exact thing just last week.
So it is pretty clear that these companies are out for your hard earned dollar and will do anything to get it. Who would have predicted this 6-months to a year ago? Waiving airline booking fees? That is what makes these companies a majority of their cash. How on earth can they survive in the long term?
What started as a friendly little promotion by the big three, looks to now be just a standard when you book airline tickets via their sites. The other big dog in the game, Priceline.com, has been waiving airline booking fees since 2007.
Oddly enough, out of all four of the travel websites (Orbitz, Expedia, Travelocity, and Priceline), only Priceline saw a profit in the first quarter of 2009. So will the waiving of the airline booking fees by the others bring them the same luck as Priceline? Only time will tell.
But waiving fees is very risky, as most travel companies make their money that way, which is why most analyst see this as just a simple extended promotion. They feel that once the economy is stronger and people are traveling more, that we will see the return of the fees. I agree.
But like most businesses that struggle to turn a profit, the only next thing left to do is either shut down or merge. My money is on the latter. Perhaps an Orbitz.Expedia.com will debut by Christmas.
Source: Reuters
