While bricks-and-mortar travel agents seem to be doing OK, there's activity in the on-line sector, too.
It seems that Wotif is going to be acquired by Expedia (at a price of $3.30 per share, including a special dividend). Wotif has been having a bit of trouble recently, with the share price hitting a low of $2.26 on 21 May, way below its 52 week peak of $5.25 on 22 July last year (and even further below its all-time high of $7.69 in April 2010). This is in spite of claiming to have 36% of the Australian
accommodation online-booking market (see company research posted on CommSec site). Media reports suggest that it hasn't been keeping up on the technology side of things.
The takeover of Wotif.com will presumably result in the disappearance of its "interesting" code from the ASX.
The Trip Advisor community doesn't really like the deal (not that this is relevant!), as Expedia evidently have a reputation for charging higher commissions than Wotif, and for seeking favourable conditions from providers. (Interestingly, Trip Advisor itself was spun out of Expedia).
Will Expedia maintain Wotif as a separate brand? Or should that be "brands"? Like other players in this market (and in the bricks-and-mortar market), Wotif also runs other sites including the lastminute.com.au and, travel.com.au sites. And Expedia also runs Trivago, Hotels.com and Hotwire,as well as having a tie-up with Travelocity. Thus, perhaps the Wotif brand will continue, at least on the consumer-facing side.
The other major international player is said to be Priceline (which owns booking.com.). This interesting article in the AFR points out the dominance of the large operators. The scale of Expedia and Priceline means they can sign up more hotels, negotiate better prices and insist on better deals from accommodation providers (for example, enabling them to offer price-match deals). So other Australian operators such as Webjet (which, I note, owns Zuji) and even Flight Centre might find themselves being squeezed.