Duff on Hospitality Law

Like prior weeks’ Updates, this week’s Update features stories on the growing phenomenon of fintech and its effect on the travel industry. Enjoy.

Dissatisfaction With Expedia Directors
(“Do Travel Agents Matter in Online Travel? Expedia Thinks So,” June 22, 2022 via Skift (subscription may be required)
Skift recently featured an interesting article describing apparent shareholder dissatisfaction with certain of the online travel giant’s board members. The dissatisfaction (expressed through withheld votes in connection with Expedia’s recent annual shareholders’ meeting) was focused on board members Chelsea Clinton, Craig Jacobs, Dara Khosrowshahi and Beverly Anderson. While there isn’t any information detailing the reasons for the withheld votes, Skift speculates it may relate to shareholder concerns with executive compensation, depressed share price or even the political views of the targeted board members.

This week’s Update features a variety of stories, including updates on Sabre’s attribution sales efforts and the growing importance of Booking.com’s mobile application in the U.S. Enjoy.

Sabre Moves Forward With Attribution-Based Sales
(“Sabre on Hospitality Marketplace Development, Attribute Selling,” June 14, 2022 via Phocus Wire)
For some time now, clients have complained that Sabre’s (and other GDS providers’) innovation efforts have largely been focused on airlines, leaving hoteliers to fend for themselves with the old legacy GDS platforms. According to Sabre, that “airline-first” approach may soon change as Sabre continues its efforts to launch its new intelligent retailing platform. According to Sabre’s Senior Vice President of Sabre Hospitality Solutions, Frank Trampert, Sabre’s new platform will allow hoteliers to create personalized offers like those found on traditional retail websites (e.g. Amazon). Hotel rooms will remain central to the platform, but other ancillary amenities and services will be available for booking at the same time. This month, Sabre plans to introduce 23 features as part of the platform’s initial product test. Pilots of the platform will begin in October with a general release of the platform scheduled for early 2023.

This week’s Update features stories on Hopper and its latest fintech offering, Agoda’s new “eco” oriented discount program and Expedia Group’s Peter Kern’s summer travel plans (watch the video). Enjoy.

Leave Anytime: Hopper’s Latest Offering
(“Hopper Will Let Customers Pay a Fee to Leave the Hotel After Check-In for Any Reason,” June 7,2022 via Skift) (subscription may be required)
Don’t like your hotel or the room you received? No problem. Hopper has a solution. Hopper announced its latest fintech offering, which allows guests in exchange for a fee paid to Hopper at the time of booking, to leave their hotel at any time for any reason following check-in. Guests electing to leave their original hotel can then book an alternative hotel with Hopper covering the costs. Hopper estimates the price for this new option to average $30.00. Hopper claims that it will pay the fees and charges owed the guest’s original hotel, though one can foresee a future where Hopper becomes a formidable adversary disputing hotel charges on behalf of their allegedly disgruntled guests. With this latest announcement, Hopper also announced the expansion of several of its existing offerings, including the expansion of its cancel for any reason product into hotels and its price freeze product into rental cars.

Last week’s Update features stories on two less frequently used social media platforms – Instagram and Snapchat – and details the brewing battle among banking companies for travel industry legitimacy. I hope you enjoy.

Tripscout Introduces Instagram Hotel Bookings
(“Tripscout Raises $14 million, Launches Hotel Booking Through Instagram,” June 3, 2022 via Phocus Wire)
Tripscout announced plans to launch a hotel booking platform accessed via Tripscout’s Instagram accounts. According to Tripscout founder and CEO, Konrad Waliszewki, users of the platform will have access to private / fenced rates 75 percent below best available rates. Users seeking to access the platform send a direct message with the word “hotel” to the applicable Instagram account, which then links the user to the booking platform where the user can search, review and book hotel listings provided via bed banks, OTAs and other suppliers. Tripscout claims to have 30 million regular users of its 100+ Instagram accounts.

This week’s Update features two stories detailing fintech’s growing influence on online travel. Regular readers of our Update know that we’ve featured a number of fintech and payment related stories this past year, with multiple stories on Hopper, Booking.com and its much discussed payment platform, Visa, and others. And if you need any further proof of the growing influence (or likely future influence) of payments on online travel, one only need to review the list of regular readers of our online travel blog on JD Supra, which reads like a who’s who of the payments world – American Express, Capital One, Bank of America, JP Morgan Chase and Deutsche Bank. I hope you enjoy this week’s Update.

Musafir Partners with Mastercard to Launch Innovative Payment Options
(“UAE-Based OTA Musafir Signs with Mastercard,” May 27, 2022 via Business Travel News)
Three weeks ago, it was Agoda announcing its partnership with Visa. Last week, Dubai-based online travel agent Musafir announced its own exclusive partnership with Mastercard. According to the announcement, the parties will work together to “digitize payment flows,” launch new innovative payment products and provide expense management tools for Musafir’s corporate customers. Musafir claims to be the region’s first O.T.A. with 1800 businesses participating on its business booking platform.  For more details on the growing influence of fintech products on online travel, make sure to read the story below from Wit, detailing Amadeus’ recent Travel Fintech Investment Trends 2022 report.  

Last week’s Update continues the theme of providing updates on a few lesser known distribution platforms – this week we feature Latin American distributor, Despegar, and Central and Eastern European distributor, the Szallas Group. Enjoy. 

Jury Supports U.S. Air Claim That Sabre Monopolized the Airline Booking Industry, But…
("Sabre Illegally Monopolized Airline Ticket Booking Market but U.S. Airways Gets Just $1.00 in Damages, U.S. Jury Concludes," May 19, 2022 via MLEX Insight)(subscription may be required)
A N.Y. federal court jury found last week that Sabre used exclusionary conduct to maintain its monopoly in airline distribution to the detriment of U.S. Air, BUT (and it is a large, BUT), the jury also found that Sabre did not unreasonably restrain trade and that U.S. Air was entitled to only $1.00 in damages. Recall that this was the second trial in this matter, with the first resulting in a $15 million award against Sabre. The original award was overturned on appeal, following a U.S. Supreme Court ruling regarding similar two-sided platforms (both supplier facing and travel agent facing). What this decision and the $1.00 award might mean for Sabre (or those airline or hotel suppliers currently contracting with Sabre) in the future, are unknown.

Last week’s Update features a variety of stories, including updates on several platforms that we don’t routinely cover – Kakao, Agoda and Trip.com. Enjoy.

Kakao Expands Ride-Hailing Offerings
(“Kakao Mobility Partners With Splyt to Expand Transportation App,” May 13, 2022 via Phocus Wire)
Last week, South Korean mobile platform Kakao announced a new partnership with Splyt, which will expand the platform’s ride hailing services to seven additional Asian countries. Users of the app can access taxis, private cars and motorcycles. Users of the expanded app will also have access to a variety of payment platforms, including micro payments.

Last week’s Update features a variety of stories, including FlightHub’s attempt to resurrect its reputation and US Airways’ latest claims against Sabre. Enjoy.

FlightHub’s Latest Pitch: Trust Us
(“OTA that was charged a record DOT fine insists it is trustworthy,” April 25, 2022 via Travel Weekly)
When considering the many factors that one may use to evaluate a potential distribution platform, trustworthiness is really overblown. At least that’s the current pitch of FlightHub (parent company to both JustFly.com and FlightHub.com). Just weeks after receiving the Department of Transportation’s Office of Air Consumer Protection’s largest fine (which comes on the heels of a similar settlement with the Canadian Competition Bureau over similar conduct), FlightHub is in full damage control mode. In both instances, the consumer protection agencies alleged that FlightHub’s OTAs misrepresented fares, cancellation charges and ticket refunds and bag fees. Interestingly, FlightHub CEO, Chris Cave, claims that these “voluntary” settlements are the best possible evidence of FlightHub’s commitment to full transparency with its travelers. Huh? 

We begin this week’s Update with the promised overview of the DOJ’s recent guidance on the ADA and website accessibility. Enjoy.

Expedia Group’s Trivago Fined for Misleading Room Rates
(“Trivago fined for misleading consumers on hotel room rates,” April 22, 2022 via Hotel Management Network - Top Stories)
Last week, the Australian Federal Court fined metasearch platform, Trivago, $44.7 million for its misleading claims about rates on its website and in television advertising. The decision culminates an extensive investigation by the Australian Competition and Consumer Commission (ACCC) that began 2018. At issue was Trivago’s use of an internal algorithm that produced search results based on the cost-per-click (CPC) fees paid Trivago by booking sites (the higher the fees paid, the better search placement) and not, contrary to advertising by Trivago, on the lowest available rates. As part of the investigation, Trivago admitted that use of the algorithm caused consumers to overpay approximately $38 million to booking sites. 

Last week was all about loyalty as we saw a number of stories on the new roles that technology and online platforms are playing for hoteliers seeking to update and expand (or even launch) their loyalty programs. We include three of those stories in this week’s Update. Enjoy.

Technology Powers Loyalty Program Growth
(“IHG introduces new loyalty program,” April 13, 2022 via Hotel Business)
 (“Tech is powering the new look of hotel loyalty programs,” April 16, 2022 via Phocus Wire)
(“Fintech to Help Smaller Hotel Brands Like Selina Launch Rewards Cards,” April 13, 2022 via Skift) (subscription may be required)
This week, we feature three separate stories detailing the important role that technology (and online platforms) is playing in updating existing and launching new loyalty programs.

• • In recent weeks, both IHG and Accor have announced major updates (in the case of IHG, a complete overhaul) to their loyalty programs. In the case of IHG and its new IHG One Rewards program, the program is centered on IHG’s mobile application and now allows members to customize the rewards they receive through another online platform, Milestone Rewards. The newly constituted program, including Milestone Rewards, is expected to be available in June. Accor also recently announced changes to its loyalty program Accor Live Limitless (ALL) through a new partnership with online entertainment platform Fever, which will allow members to use their loyalty program benefits to book a variety of activities and experiences.
  • Lastly, Skift explains how fintech startups are allowing smaller hotel and travel companies (Selina) to launch new co-branded payment cards (to boost their fledging loyalty programs) in under a month. In Selina’s case, its planned card will feature cash rewards for signing up, loyalty program points and cash rebates for hotel stays.