This article is part two of a two-part series on the Expedia/Orbitz merger. Here is the first part.
Hotel Management reached out to Expedia for insights on the merger and received the following:
"We’re pleased to officially welcome Orbitz Worldwide to Expedia. The addition of Orbitz brings Expedia an attractive set of well-recognized brands built by a talented team that is passionate about travel. With the acquisition closed, we look forward to enhancing customer experiences, improving the reach for our global supply partners and delivering our great deals to travelers around the world through our growing family of brands.
"We are excited to begin the work of integrating these two companies. We look forward to quickly learning more about each Orbitz Worldwide brand, business unit and team. We are still in the early days of planning and integration, which means it will be business as usual for our suppliers’ relationship with the Expedia and Orbitz teams. We look forward to continuing to grow our relationship with our valued partners."
While the response lacks any real meaning, clearance of the deal is no doubt a huge win for Expedia. And while many hoteliers are skeptical, the Justice Department believes the merger won't harm consumers or be unfair from a competitive standpoint.
Bill Baer, head of the Justice Department's Antitrust Division, said that during a six-month investigation, the Antitrust Division found no evidence that consumers would face higher charges if the two booking companies merged.
"The Antitrust Division investigated the concerns that have been expressed about this transaction," Baer said. "At the end of this process, however, we concluded that the acquisition is unlikely to harm competition and consumers."
The hotel industry, meanwhile, isn't buying it.
"As we've said all along, this transaction will result in significant negative consequences for consumers and also the large number of our members who are small businesses and independent hotels," the American Hotel & Lodging Association said in a statement. "It could lead to increased distribution costs for independent hotel owners who risk seeing booking commissions rise by double digits."
In July, lawmakers on a Senate antitrust panel wrote to the Justice Department warning that the deal could end up hurting the industry.
"Increased consolidation among online travel agencies could transform a market that has benefited consumers into one that stifles competition," wrote Sens. Mike Lee (R-Utah) and Amy Klobuchar (D-Minn.).
Moving forward, James Bethany, corporate director, revenue management for the Peachtree Hotel Group, said that hotels should continue to yield where necessary to eliminate expensive booking channels in hopes of driving traffic to the brand websites for bookings. “That is the least-expensive booking channel for us,” he said. “I think time will tell how this rolls out.”