Expedia’s acquisition of Orbitz strongly opposed in letter from lodging-related groups
A wide variety of small hotels, independent properties, state associations and others have sent a letter to the Department of Justice in the USA urging the Department to stop Expedia from acquiring Orbitz.
The letter claims that the merger would be extremely anticompetitive and would negatively affect business for all involved.
It reads: “Small, independently owned, and economy hotels are particularly subject to the anticompetitive effects of this merger. In many markets, small businesses and independent hotels rely on online travel agencies (OTAs) to fill 30-40 percent of their rooms, with some as high as 60-70 percent. Yet, smaller businesses with fewer than 30 properties face the most serious consequences because they often times pay in excess of 25 percent more in online travel agency commissions.
“They must do business with these OTAs but will have virtually no leverage to resist any commission rate increase imposed by Expedia. These serious anticompetitive effects will substantially harm our country’s small businesses, vital to the economy of communities across the country. For these reasons, we urge you to block the proposed Expedia-Orbitz merger.”
The opposition is notable as continued OTA mergers have been a controversial talking point here in Australia.
Read the letter in full here.
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