Regulatory Scrutiny of Online Travel Platforms Could Shed New Light on Business Practices
Skift Take
Online travel companies have faced intense regulatory scrutiny almost since the first days of internet bookings. But "you've got mail" these days is less likely to be a cheery email notification than a demand for court appearances and audits.
Whether it's online travel companies like Trivago, Booking.com, or Airbnb, regulators around the world are lashing out at the business models of these companies and their competitors.
In two recent examples, the Australian Competition Commission disclosed that the country's federal court found that Germany's hotel-price comparison business Trivago was displaying hotel rates from the highest bidders in its auctions, and often hiding cheaper rates behind a "more deals from" list in violation of competition law. The court also took issue with the strike-through prices that inflated the discount consumers would receive.
In the UK, starting in September, sister companies Booking.com, Agoda, and Kayak, as well as some competitors, agreed to take certain steps to settle some of the competition authority's investigations over "pressure selling," which includes messaging on Booking.com's hotel pages such as "2 other people looked for your dates in the last 10 minutes."
The Australia Trivago case, which got under way in 2018, puts into focus the practices of numerous metasearch sites around the world. Like Trivago, Google's hotels feature, for example, has hidden cheaper rates while sometimes placing higher ones in coveted positions on the first screen of a listing.
In metasearch auctions, online travel agencies and hotels bid for positions within a listing. The ranking, whether the bidder is listed first, third, or relegated to a secondary page, can have a huge impact on whether consumers click, and eventually make a hotel booking.
As regulators have pointed out, metasearch companie
