The Vacation Rental Managers Association says it broke off talks with Pegasus Solutions over the development of a vacation rental switch to bring professionally managed vacation rental properties online.
The VRMA says its board informed members today that the two parties couldn’t reach an agreement with “reasonable terms that best serve the interests of vacation rental managers and their clients.”
VRMA says it will continue to develop the vacation rental switch by restarting a Request for Letter of Interest process to name a new technology provider for the switch.
The vacation rental association released what only can be interpreted as a put-down of Pegasus Solutions, arguing that VRMA needs a partner which “is in sync” with the association’s vision.
Alex Risser, VRMA president, stated:
“We are excited to move forward with the momentum of developing the Vacation Rental Switch, and are fully committed to meeting the needs of our industry,‚ÄĚ said Alex Risser, President of VRMA. “From the outset, we have set a clear vision of the terms and conditions for an industry Switch which serves professionally managed vacation rentals and provides support for it to continue as the fastest growing segment of the travel sector. We remain committed to those terms to protect the long-term interests of our membership, and we will move as quickly as possible to partner with a provider who is in synch with that same vision. VRMA will be the first to make hundreds of thousands of branded professionally-managed vacation rentals available and bookable on-line.‚ÄĚ
The VRMA says it establishing a July 29 deadline for interested parties to answer the Request for Letter of Interest, which can be downloaded here.
Unless the VRMA statement is a negotiating ploy to get Pegasus Solutions back to the bargaining table and ready to deal concessions, the development may be seen as a setback for the vacation rental industry, which has long struggled to get more professionally managed properties online.
Pegasus Solutions made its name in the hotel industry for creating a hotel switch to distribute hotel inventory to disparate channels.
In an interview with Tnooz in late May, Steve Lapekas, executive vice president of corporate business development at Pegasus, acknowledged that creating a switch for vacation rentals is more complex than for hotels because vacation rentals come in more shapes and sizes.
He said Pegasus Solutions doesn’t need to “reinvent the wheel” to create a vacation rental switch.
At the time, the thinking was that vacation rental switch development had neared completion, and it was left to the parties to come to terms.
Apparently negotiations have not gone smoothly.
Ironically, the announcement in the breakdown in talks comes on the day when rental giant HomeAway became a public company with a $2 billion valuation.
Some observers speculate that the VRMA-Pegasus Solutions breakdown gives HomeAway, which is acquiring and developing its own technology solutions as a priority, even more of an edge.
If the VRMA-Pegasus Solutions vacation rental switch was designed to be a hedge against HomeAway, then the hedges may have just been sheared.
Pegasus Solutions declined to comment on the development.
As one of the specs for the new Request for Letter of Interest, the VRMA says it is looking for a solution with no up-front costs for professionally managed vacation rental properties. The proposal states the VRMA seeks:
A low cost, transactional based model that encourages participation, with no upfront cost to¬†VRMs and low upfront cost to software providers and distribution channels, which will enable¬†higher utilization of the Switch and ultimately facilitate significantly greater amounts of¬†commerce.
The VRMA says its roster includes 600 property management and associate members throughout the U.S., Canada, Mexico and the Caribbean. These members represent some 150,000 vacation rental properties, the association says.