US OTA Transactions decline in January

There will be a fair amount of spin going on about this news.

ARC's January 2011 detailed breakdown of transactions shows a decline in Online Travel Agency activity when compared to last year.

After the significant jumps in 2010 over 2011 - we can expect a moderating level of activity but the fall was unexpected.

Clearly something is going on.

One can expect that with Orbitz and Expedia both making up a high percentage of the US OTA market and both having lowered or reduced activity on AA that there would be some effect. But I think that the fall is higher than I would have anticipated when compared to the over sectors of the market. (Corporate and general retail).

I think that the impact of the OTA's battle with AA and the resultant shift to meta search traffic sites such as Kayak and of course to AA direct is now becoming apparent.

Next month's traffic with things becoming stabilized will be an interesting statistic

Cheers

Microsoft gets back into Travel - Buys Farecast

MS still owns a portion of Expedia but its somewhat remote. However, they decided to get back into the Travel game (via their MSN Travel vehicle) and have bought out Farecast.

Congrats to Hugh Cream and his team. This is a good acquisition on both sides and indicates the value of the search proposition now that sector has matured. With Yahoo owning a tool, Kayak and Sidestep as one, the business has the right dynamics.

This may seem to be a conflicting signal with regards to the G2 failure just recently. However I believe that this is just a shifting sands issue.

Underneath all of this is a supply side market that has gone soft. Better distribution and channel management tools are required. Better consumer tools are required. What is missing here is a better infrastructure. Harder problem to solve.

Cheers

Timothy