As expected, Wotif has upped its commission rates to accommodation operators from 12 to 15 per cent – an inevitable consequence of its $703 million takeover by Expedia.
And Agoda, owned by the other half of the OTA duopoly Amsterdam-based Priceline, has done the same.
Expedia and Priceline now control about 85 per cent of the online hotel booking market in Australia.
Expedia wants all Wotif contracted properties on a single company-wide contract. Expedia has also told accommodation providers that from next month all Wotif bookings will be powered by the Expedia platform.
An Expedia spokesperson said accommodation providers have generally responded well to the change.
Accommodation providers had bombarded the Australian Competition and Consumer Commission with evidence that this would happen if Wotif was swallowed up by Expedia but the competition regulator approved the takeover anyway without any conditions on the acquisition.
ACCC chairman Rod Sims defended the ACCC line by saying, “Our test is not so much that there is a lessening of competition, but a substantial lessening of competition. What was key for us was the other web-based entities that were now allowing bookings direct with the accommodation providers more and more, and it seemed to us that the market was opening up… through technology.
“The ACCC considered that the acquisition was unlikely to diminish the dynamic nature of the industry.”
Expedia’s $1.66 billion takeover bid for Orbitz, if it gains regulatory approval, will leave just two large global OTAs.
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