On the heels of Expedia Worldwide president Scott Durchslag exiting the company in January, CEO Dara Khosrowshahi used words such as “unsatisfactory” to describe “the overall Expedia brand performance,” and “poorly” to characterize how airline ticket sales and vacation packages fared in the fourth quarter of 2011.

Expedia Inc.’s revenue increased 7% to $787.1 million on a 19% increase in hotel room nights in the fourth quarter, although a decrease in revenue per room night put a damper on things.

Adjusted EBITDA fell 4% in the quarter to $162.1 million, and content and technology costs, including monies allocated to the tech platform, rose 29% to $98.6 million.

Hotels.com and the Expedia hotel product have been migrated to the new tech platform, the air product will be on board by the end of the first quarter, but vacation packages aren’t expected to be transitioned “until the back half of 2012,” Khosrowshahi told financial analysts during the company’s fourth quarter conference call yesterday.

Khosrowshahi expressed confidence that the new platform will increase conversions and enable Expedia to innovate faster, but he conceded that the company has something to prove and “there are a lot of ifs at this point.” He said:

Listen, all other things being equal, when E3 is complete, I would expect to see room night growth accelerate for Expedia, not only standalone room nights but especially packaged room nights that have been a negative factor. And I would hope to see that in the second half of the year. Again, we haven’t done it. But that’s why we’re investing the way that we are on the technology side.

The company says subsidiary Hotels.com, which transitioned to the E3 technology platform in early 2010, “experienced healthy room night growth across all regions during the fourth quarter.”

Khosrowshahi added:

And Hotels.com has continued to maintain … high room night growth. And hopefully, with execution, we’d expect to see that continue on a go-forward basis. But again, we know that we have to prove that out to you. I think the Q4 room night number was really healthy, and I think it was really healthy without Expedia hitting on all cylinders. So if we can hit on all cylinders, we could see things get better. But those are a lot of ifs at this point.

There were bright spots in the earnings announcement.

Expedia is bullish on its 50-50 AirAsia joint venture, which chipped in with healthy room night and hotel revenue growth in the fourth quarter.

And, Expedia CFO Mark Okerstrom says the company is not feeling any impact from Booking.com’s share gains in the US market, where Expedia’s hotel share likewise is growing.

Financial analysts offered varying views about Expedia’s prospects following the earnings release.

Tom White, an analyst for Macquarie Capital, has a “neutral” rating on Expedia and wonders about the cost of the technology upgrades. White says:

The main question for the stock in our view is not whether the Expedia brand’s tech re-platforming will yield improved conversion rates but when and how much the initiative will ultimately cost. This limited visibility, coupled with the potential for y/y EBITDA declines in 1Q given EXPE’s increased seasonality post the TRIP spin is enough to keep us on the sidelines near-term despite EXPE’s appealing relative valuation. Add to this EXPE’s larger relative exposure to the slower-growth/supplier-friendly U.S. market, and we still view PCLN as the preferred way to play the secular shift of global travel bookings moving online.

And, Mark Mahaney, an analyst for Citi Investment Research & Analysis, also has a “neutral” rating on Expedia’s stock, but says the “soft” results for Expedia in the fourth quarter sets the company up for “an excellent 2013.”

Either way, with Booking.com growing its hotel business, Expedia has something to prove.

WebJet lost 0.75% in its share of the agency category and Expedia 0.2%. Flight Centre gained 0.3%.

 Most popular travel websites in Australia for the week ending February 4 2012:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Webjet Australia	www.webjet.com.au	13.34%	1
2	Expedia Australia	www.expedia.com.au	11.83%	2
3	Flight Centre	www.flightcentre.com.au	9.20%	3
4	Lastminute.com.au	www.lastminute.com.au	5.14%	4
5	Best Flights	www.bestflights.com.au	3.41%	5
6	Jetabroad	www.jetabroad.com	2.66%	6
7	Wego	www.wego.com	2.46%	-
8	Airfares Flights Australia	www.airfaresflights.com.au	2.08%	8
9	ZUJI Australia	www.zuji.com	1.93%	9
10	Travelzoo Australia	www.travelzoo.com/au	1.72%	7

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor - Australia	www.tripadvisor.com.au	6.21%	1
2	Wotif.com	www.wotif.com	6.00%	2
3	Booking.com	www.booking.com	5.09%	3
4	TripAdvisor	www.tripadvisor.com	4.16%	4
5	Stayz	www.stayz.com.au	3.50%	5
6	Hotels.com	www.hotels.com	1.96%	6
7	Agoda Australia	www.agoda.com.au	1.94%	7
8	Totaltravel.com	www.totaltravel.com	1.47%	8
9	Agoda.com	www.agoda.com	1.12%	9
10	Lonely Planet	www.lonelyplanet.com	1.12%	-

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Postion
1	Qantas	www.qantas.com.au	23.00%	1
2	Jetstar	www.jetstar.com	19.85%	2
3	Virgin Australia	www.virginaustralia.com	17.65%	3
4	AirAsia	www.airasia.com	5.45%	4
5	Emirates	www.emirates.com	3.46%	5
6	Tiger Airways	www.tigerairways.com	3.30%	6
7	Singapore Airlines	www.singaporeair.com	3.06%	7
8	Air New Zealand	www.airnz.co.nz	1.68%	8
9	Air New Zealand - Australia	www.airnz.com.au	1.56%	10
10	Malaysia Airlines	www.malaysiaairlines.com	1.50%	9

Search Terms

Rank	Search Term	Percentage of Clicks	Percentage Paid	Percentage Organic	Previous Position
1	google maps	1.60%	0.04%	99.96%	1
2	jetstar	1.07%	0.76%	99.24%	2
3	webjet	0.78%	0.24%	99.76%	3
4	qantas	0.72%	19.93%	80.07%	4
5	maps	0.70%	0.00%	100.00%	5
6	wotif	0.58%	1.06%	98.94%	6
7	flight centre	0.57%	55.10%	44.90%	7
8	metlink	0.47%	0.03%	99.97%	8
9	whereis	0.35%	0.09%	99.91%	10
10	singapore airlines	0.34%	10.60%	89.40%	9

NB: Data courtesy of Experian Hitwise

NB2: Image via Shutterstock.

Or, if Groupon doesn’t seek to disintermediate Expedia, would Groupon want to bring in additional partners?

In Groupon’s first earnings call as a public company yesterday, CEO Andrew Mason said Groupon is “very happy with the progress” of Groupon Getaways, but is already “broadening” it from a sales perspective.

With travel an integral part of Groupon’s growth strategy, Mason said Groupon already sources a lot of the hotel deals in Groupon Getaways with its own travel sales force.

So if Groupon’s travel sales force is already striking direct relationships with hotels, why share the revenue with Expedia?

Groupon and Expedia launched Groupon Getaways last summer.

It’s a time-worn practice at Expedia, and also in travel and outside of travel: partner with a company, learn the business and then dump the partner.

“It seems to me that Groupon is being quite obvious about it,” says one travel industry insider, “and Expedia seems to be asleep at the switch.”

Groupon has been casting a wide net looking at various travel startups and they are interested in companies with hotel relationships, technology and a great management team.

No one is saying that is indeed Groupon’s wish, but the apparently increasing activity of Groupon’s own travel sales force raises questions.

Mason said Groupon Getaways is doing “well” with hotel sales, but over time Groupon could add new products and features.

Speaking to financial analysts, he declined to break out numbers for Groupon Getaways.

Asked about the costs of it, Mason said Groupon makes investments in commissions to win initial business, but “over time it lessens.”

In the fourth quarter of 2011, Groupon recorded a net loss of nearly $42.3 million compared with a net loss of $313.2 million in the fourth quarter of 2010.

Groupon’s revenue in the fourth quarter grew 194% to $506.5 million, the company stated.

The pair added around 0.5% and 0.25% market share respectively to their tallies from the previous week, keeping Expedia in pole position and pushing Travelocity up one place to fifth spot.

Priceline, Orbitz and Yahoo Travel all lost market share.

Most popular travel websites in the US for the week ending February 4 2012:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia	www.expedia.com	12.64%	1
2	priceline.com	www.priceline.com	8.68%	2
3	Yahoo! Travel	travel.yahoo.com	7.71%	3
4	Orbitz	www.orbitz.com	6.99%	4
5	Travelocity	www.travelocity.com	6.22%	6
6	Kayak	www.kayak.com	5.75%	5
7	Hotwire	www.hotwire.com	5.44%	8
8	CheapOair	www.cheapoair.com	5.35%	7
9	bookingbuddy	www.bookingbuddy.com	2.52%	9
10	Cheap Tickets	www.cheaptickets.com	2.51%	10

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor	www.tripadvisor.com	8.31%	1
2	Hotels.com	www.hotels.com	2.83%	3
3	Marriott International	www.marriott.com	2.71%	2
4	Booking.com	www.booking.com	2.20%	6
5	Vacation Rentals by Owner	www.vrbo.com	2.17%	4
6	Hilton Hotels Online	www.hilton.com	2.16%	5
7	InterContinental Hotels Group	www.ichotelsgroup.com	1.95%	8
8	Carnival Cruise Lines	www.carnival.com	1.88%	7
9	Southwest Airlines Travel Guide	travel.southwest.com	1.60%	9
10	Walt Disney World	disneyworld.disney.go.com	1.45%	-

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Southwest Airlines	www.southwest.com	22.89%	1
2	Delta Air Lines	www.delta.com	12.14%	2
3	American Airlines	www.aa.com	9.34%	3
4	JetBlue Airways	www.jetblue.com	7.36%	4
5	Continental Airlines	www.continental.com	6.75%	5
6	United Airlines	www.united.com	5.98%	7
7	US Airways	www.usairways.com	5.32%	6
8	AirTran Airways	www.airtran.com	4.48%	8
9	Allegiant Air	www.allegiantair.com	3.52%	9
10	Spirit Airlines	www.spiritair.com	3.49%	10

Travel search terms

Rank	Search Term	Percentage of Clicks	Percentage Paid	Percentage Organic	Previous Position
1	mapquest	4.36%	0.04%	99.96%	1
2	google maps	1.56%	0.88%	99.12%	2
3	southwest airlines	1.38%	34.03%	65.97%	3
4	travelocity	0.86%	58.52%	41.48%	6
5	expedia	0.81%	54.53%	46.47%	5
6	maps	0.72%	0.68%	99.32%	4
7	map quest	0.55%	0.42%	99.58%	7
8	continental airlines	0.53%	7.88%	92.12%	-
9	american airlines	0.51%	5.38%	94.62%	9
10	google earth	0.48%	14.08%	95.92%	10

NB: Data couresy of Experian Hitwise

The gap between the pair is less than 0.2% market share as Expedia gained more than Thomson last week in the agency category.

Thomas Cook in third place also added a fraction of a percentage point over the same period, while TravelRepublic in fifth lost around 0.3%.

Most popular travel websites in the UK for the week ending February 4 2012:

Agencies

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Thomson	www.thomson.co.uk	7.61%	1
2	Expedia.co.uk	www.expedia.co.uk	7.42%	2
3	Thomas Cook	www.thomascook.com	5.80%	3
4	Lastminute.com	www.lastminute.com	4.88%	4
5	TravelRepublic.co.uk	www.travelrepublic.co.uk	3.69%	5
6	First Choice	www.firstchoice.co.uk	2.82%	6
7	skyscanner	www.skyscanner.net	2.82%	7
8	Travelzoo UK	www.travelzoo.com/uk	2.62%	8
9	Cheapflights.co.uk	www.cheapflights.co.uk	2.61%	9
10	travelsupermarket.com	www.travelsupermarket.com	2.49%	10

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor UK	www.tripadvisor.co.uk	11.97%	1
2	Booking.com	www.booking.com	7.20%	2
3	TripAdvisor	www.tripadvisor.com	3.17%	3
4	LateRooms.com	www.laterooms.com	2.79%	4
5	Premier Inn	www.premierinn.com	2.04%	5
6	Travelodge UK	www.travelodge.co.uk	1.97%	6
7	Hotels.com	www.hotels.com	1.57%	7
8	Time Out	www.timeout.com	1.25%	9
9	Holiday Lettings	www.holidaylettings.co.uk	1.15%	10
10	InterContinental Hotels Group	www.ichotelsgroup.com	1.09%	-

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	easyJet.com	www.easyjet.com	18.49%	1
2	Ryanair	www.ryanair.com	14.69%	2
3	British Airways	www.britishairways.com	12.09%	3
4	Jet2.com	www.jet2.com	5.11%	5
5	Monarch.co.uk	www.monarch.co.uk	4.69%	7
6	Flybe	www.flybe.com	4.60%	4
7	Virgin atlantic	www.virgin-atlantic.com	4.02%	6
8	Thomson Airways	flights.thomson.co.uk	3.26%	8
9	bmibaby	www.bmibaby.com	2.82%	10
10	flythomascook.com	www.flythomascook.com	2.54%	9

Travel search terms

Rank	Search Term	Percentarge of Clicks	Percentage Paid	Percentage Organic	Previous Position
1	google maps	0.98%	0.45%	99.55%	1
2	national rail	0.67%	0.76%	99.24%	4
3	easyjet	0.65%	3.09%	96.91%	3
4	thomas cook	0.65%	37.72%	62.28%	2
5	ryanair	0.59%	1.65%	98.35%	5
6	tfl	0.53%	1.30%	98.70%	6
7	travelodge	0.42%	33.08%	66.92%	7
8	trainline	0.42%	45.95%	54.05%	10
9	aa route planner	0.41%	0.73%	99.27%	9
10	train times	0.38%	21.18%	78.82%	-

NB: Data courtesy of Experian Hitwise

NB2: Image via Shutterstock.

Users merely enter a departure airport, the month they want to travel, the maximum they want to spend per person and length of stay, and then Trip Explorer fills a map of the world (primarily the US, Canada and the Caribbean with a bit of Europe) with vacation package possibilities.

So if you want to depart from Chicago O’Hare in February for 5 to 7 nights and want to spend up to $2,000 per person, Trip Explorer might find you a $1,007 per night and per person package flying American Airlines to Curacao and staying at the Wave Hotel & Cafe.

And, when you click on the link, you navigate to an Expedia.com vacation packages page where Expedia also tries to upsell you on a more expensive trip ($1,625 per person) to the Renaissance Curacao Resort & Casino, which has an advertisement on the top of the vacation package listings.

Having a vacation inspiration tool such as Trip Explorer is becoming an ever-more popular feature for an online travel agency or airline these days. With an assist from Amadeus, Lufthansa has pioneered such features on some of its global websites.

Andrew Griffard, senior manager of merchandising at Expedia, says of Trip Explorer that “customer feedback has been overwhelmingly positive. They’ve given us plenty of great ideas for enhancements to the tool, which we are busy developing now.”

Wait. Expedia recently spun off TripAdvisor so perhaps the axes can be sheathed.

OK, the statement about Expedia’s alleged undue influence over Priceline is tongue in cheek, but new research from Citi shows that Expedia was indeed the largest traffic source for Priceline with an 18% referral share in January 2012. And that mark represents increased clout when compared with January 2010 (15%) and January 2011 (16%).

Perhaps Priceline should reconsider throwing all that dough into Google and do a little more advertising on Expedia sites. (OK, the tongue’s wagging again.)

Mark Mahaney, managing director of Internet research for Citi Investment Research & Analysis, says Expedia’s influential role as a traffic referral source for Priceline “highlights the extent of comparison shopping that occurs in the online travel vertical.”

After Expedia, the leading sources of traffic for Priceline in January 2012 were the Kayak network (12%), Google sites (12%), Microsoft sites (9%) and Yahoo sites (6%), according to the Citi’s Annual ‘Net Influence Report.

In turn, Priceline and Orbitz Worldwide acted as a source of Expedia traffic at a pace of 7% and 4%, respectively, while Google sites (16%), Yahoo sites (7%) and Microsoft sites (6%) also chipped in as traffic drivers to Expedia in January 2012, the Citi research shows.

Among other online travel agencies, Orbitz’s top traffic driver was Google (14%), which just edged Expedia (13%) as a traffic source to Orbitz.

Other leading referral sites for Orbitz weren’t even close to Google and Expedia. Yahoo sites referred 5% of Orbitz’s traffic in January 2012, followed by the Kayak network and Microsoft sites, which were responsible for 4% each of the Orbitz traffic.

It is interesting that although Orbitz and Kayak have been at odds during the last couple of years over changes that Kayak made to its advertising practices, which Orbitz alleges violated a contractual exclusivity provision, Kayak has steadily acted as a referral source for Orbitz at a 4% clip over the last three January’s, the Citi research shows.

Citi breaks down Travelocity’s traffic-referral sources as Google sites (12%), Yahoo sites (8%), Expedia (7%), Micrsosoft sites (5%) and Priceline (2%).

Among other leading online sites in the U.S., Southwest Airlines doesn’t look to online travel agencies for referral traffic because the airline refuses to distribute its flights through the OTAs. Citi depicts Southwest’s leading traffic referral sources as Google (16%), Yahoo sites (15%) and Microsoft sites (7%).

When looking at the leading websites in the travel vertical, Google is the most influential source of traffic and has been slowly, but steadily, increasing its referral share from 12% in January 2010 to 13% in January 2011 and 14% in January 2012, the Citi research shows.

In addition to its gains in the travel vertical, Google has also been increasing its influence as a traffic referral source in the finance vertical (13%). But, Google has seen its influence wane somewhat in the media (22%), retail (15%), autos (14%) and health (15%) verticals.

All four sites – Skyscanner, Cheapflights, Travelzoo and Travelsupermarket – increased their market share last week as others such as Thomas Cook and TravelRepublic saw slight decreases.

Market leader Thomson is still managing to hold off the threat of Expedia, with around a third of a percentage point over its rival.

Most popular travel websites in the UK for the week ending January 28 2012:

Agencies

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Thomson	www.thomson.co.uk	7.60%	1
2	Expedia.co.uk	www.expedia.co.uk	7.25%	2
3	Thomas Cook	www.thomascook.com	5.70%	3
4	Lastminute.com	www.lastminute.com	4.51%	4
5	TravelRepublic.co.uk	www.travelrepublic.co.uk	4.08%	5
6	First Choice	www.firstchoice.co.uk	3.11%	6
7	skyscanner	www.skyscanner.net	2.78%	7
8	Travelzoo UK	www.travelzoo.com/uk	2.69%	9
9	Cheapflights.co.uk	www.cheapflights.co.uk	2.57%	8
10	travelsupermarket.com	www.travelsupermarket.com	2.46%	10

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor UK	www.tripadvisor.co.uk	12.30%	1
2	Booking.com	www.booking.com	7.15%	2
3	TripAdvisor	www.tripadvisor.com	3.16%	3
4	LateRooms.com	www.laterooms.com	2.53%	4
5	Premier Inn	www.premierinn.com	1.97%	6
6	Travelodge UK	www.travelodge.co.uk	1.86%	5
7	Hotels.com	www.hotels.com	1.51%	7
8	Owners Direct	www.ownersdirect.co.uk	1.29%	8
9	Time Out	www.timeout.com	1.22%	10
10	Holiday Lettings	www.holidaylettings.co.uk	1.22%	9

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	easyJet.com	www.easyjet.com	17.91%	1
2	Ryanair	www.ryanair.com	13.95%	2
3	British Airways	www.britishairways.com	12.12%	3
4	Flybe	www.flybe.com	5.32%	7
5	Jet2.com	www.jet2.com	5.15%	4
6	Virgin atlantic	www.virgin-atlantic.com	5.02%	6
7	Monarch.co.uk	www.monarch.co.uk	4.76%	5
8	Thomson Airways	flights.thomson.co.uk	3.31%	8
9	flythomascook.com	www.flythomascook.com	2.79%	9
10	bmibaby	www.bmibaby.com	2.58%	10

Travel search terms

Rank	Search Term	Percentage of Clicks	Percentage Paid	Percentage Organic	Previous Position
1	google maps	0.97%	0.47%	99.53%	1
2	thomas cook	0.65%	35.51%	64.49%	2
3	easyjet	0.64%	2.69%	97.31%	3
4	national rail	0.58%	1.15%	98.85%	5
`5	ryanair	0.52%	1.25%	98.75%	4
6	tfl	0.46%	1.25%	98.75%	6
7	travelodge	0.42%	30.50%	69.50%	8
8	thomson	0.41%	1.43%	98.57%	7
9	aa route planner	0.40%	0.54%	99.46%	-
10	trainline	0.39%	45.24%	54.76%	10

NB: Data courtesy of Experian Hitwise

NB2: Image via Shutterstock.

But, at least I wasn’t the only one.

The death of William Shatner’s The Negotiator character stoked some memories.

It was April 2005 in the Norwalk, Connecticut, office of Priceline CEO Jeffery Boyd and he was explaining the company’s strategic shift from being primarily an opaque seller of merchant hotel inventory through its Name Your Own Price service into a full-fledged retailer of air, hotel and car inventory.

More than a year earlier Priceline had debuted airline tickets on a retail basis and now it was adding hotels and cars so it could take on the then-much larger online travel agencies, Expedia, Travelocity and Orbitz.

At the time, Priceline crunched only about 13% of the gross bookings that Expedia did, and Boyd said that day that Travelocity’s and Orbitz’s gross bookings were about twice that of Priceline’s.

So, the smallest of the four was going to make its move to become a full-service OTA and play with the big boys and girls.

And, Boyd thought there was no reason there couldn’t be a Big Four instead of a Big Three.

It’s unclear how much Expedia, Travelocity and Orbitz heeded the threat, but Boyd clearly laid out the blueprint: Priceline would become a full-service OTA and expand through organic growth and acquisitions.

“Retail airline tickets was a big piece of that,” said Boyd, referring to a growth spurt in 2004. “If the new product launch of hotels is anywhere near as successful, I would expect our business would gain share and continue to gain share as we have done historically.”

Priceline had already acquired Active Hotels, would scoop up Bookings B.V. in July 2005, and tack on Agoda a couple of years after that as the OTA engineered a Europe and Asia marketshare grab in hotels.

Back in April 2005, however, the other OTAs were not surprised or particularly concerned about Priceline getting into the retail hotel business.

After all, they were focused primarily on the merchant model for hotel sales and were bigger and badder.

Michelle Peluso, then-CEO of Travelocity, said it made sense for Priceline to expand beyond Name Your Own Price, but Travelocity would have advantages because it could count on the resources of parent-company Sabre.

And, an Expedia spokesman said the company preferred its multi-brand approach — Hotwire for opaque hotels and Expedia for merchant and published rates — to Priceline’s tack of stitching it all together.

The Expedia spokesman wondered whether Priceline’s retail offering would cannibalize its opaque hotels business.

Boyd said Priceline had initially been concerned when it launched retail air that it would dilute the company’s opaque air business, but it found retail air brought incremental bookings.

Fast-forward to 2012 and Priceline, riding its global hotel offering, has a $26.3 billion market cap compared with the recently TripAdvisor-less Expedia at $4.7 billion.

In 2005, did Expedia, Travelocity and Orbitz see all this coming?

Perhaps even Priceline would have been hard-pressed to predict the depth of its success.

Were the three other OTAs complacent in the beginning?

Were they over-confident based on their parentage or were they reading their own press clippings too closely?

Priceline and others undoubtedly will learn from all of this online travel history.

They should be cautious and cognizant that they shouldn’t count out Expedia, which apparently has fixed up its global technology platform, and has allied itself with Groupon and boasts of an exclusive agreement with AirAsia.

Sometimes online travel history — or perhaps we should say mobile-travel or social-travel history — unfolds before your eyes and you don’t recognize it right away.

There are tons of travel startups which have outlined their strategies in the Tnooz TLabs Showcase.

Is there a travel startup out there laying out its battle plan, calmly articulating how it will survive and thrive, and we just can’t recognize it through all of the noise?

Many people didn’t take Priceline seriously, either.

If an analysis by search engine marketing firm WordStream is to be believed, then Booking.com indeed was the top dog among Google AdWords spenders in the Travel & Tourism category in 2011.

If you’ve visited the Internet lately, it’s not hard to find a Booking.com AdWords ad:

WordStream published an infographic (see below) on the top spenders in Google AdWords by industry and, to some extent, by brand. (And, see WordStream’s methodology at the end of this post.)

WordStream pegs Travel & Tourism as the third largest spender in Google AdWords in 2011 at $2.4 billion (behind Finance & Insurance, $4 billion; and Retailers & General Merchandise, $2.8 billion).

And, the top five travel brands in Google AdWords spending, according to WordStream, were:

• Booking.com, $40.4 million

• Expedia, $28.9 million

• Kayak, $28.7 million

• Marriott, $20.9 million, and

• Priceline (which owns Booking.com), $19.6 million.

Here’s the infographic:

The WordStream breakdown of Google AdWords customers speaks to the spending power of and search-engine marketing commitments of Booking.com, Expedia, Kayak, Marriott and Priceline, and it is indeed possible that Booking.com was the top-spending travel brand (not company) in Google AdWords last year.

But, alternative and much higher 2011 estimates provided by Herman Leung, an Internet e-commerce and media analyst for Susquehanna Financial Group, suggest that the WordStream numbers may be low and skewed toward the US.

Leung estimates that Priceline’s brands — Booking.com, Agoda, Priceline.com and Traveljigsaw etc. — spent about $730 million on Google advertising, including AdWords in 2011, while Expedia’s brands likely chipped in around $714 million — a virtual draw. These numbers are based on overall sales and marketing spend reported for the two companies for the first nine months of 2011 plus estimates for the fourth quarter.

But, looking to 2012, keep in mind that Expedia spun off TripAdvisor in December, which means that Expedia’s Google AdWords spend will decline and Priceline/Booking.com’s spending stature will rise relative to Expedia’s.

And, think of how large Priceline/Booking.com’s Google AdWords spend appears when you consider that Priceline doesn’t have a media business as Expedia did with TripAdvisor.

Meanwhile, if Expedia Inc. and Priceline alone spent a combined $1.4 billion on Google advertising last year, as Leung suggests, then WordStream’s estimated $2.4 billion figure on total Travel & Tourism spend in Google AdWords during 2011 could be low.

But, if the outlines of WordStream’s basic portrait are to be accepted, then that means that four out of the top 5 Google AdWords spenders in Travel & Tourism — Booking.com, Expedia, Kayak and Priceline — are members of the Google opposition group, FairSearch, or belong to an industry organization which is a member.

It is interesting to note that Marriott is the only hotel to make WordStream’s top five Google AdWord spenders in Travel & Tourism and that no airlines make the list.

Perhaps that is one reason that some US airlines are trying to muscle online travel agencies and Kayak out of Google Flight Search. If OTAs and metasearch firms can wield their SEM clout in AdWords, then perhaps Google Flight Search would do something toward leveling the playing field for airlines, or so the thinking might go.

Since Google doesn’t break out a list of its top AdWords customers, compiling the names of the top spenders can be a complex and inexact pastime.

Kantar Media published its own estimate on top Google AdWords spenders for the first nine months of 2011. The numbers are drastically lower than Susquehanna Financial Group’s, but cover the US only.

Note: This is how Larry Kim, WordStream’s founder and chief technology officer, describes the methodology he used to come up with the numbers in the above infographic:

I compiled these revenue estimates by using our own trillion-keyword database and the Google Keyword Tool to determine the top 10 million most popular search queries in 2011, as well as their average cost per click prices as paid by advertisers. I used WordStream PPC technologies to categorize the huge keyword list by industry, such as “Finance & Insurance,” then applied a model that weighed the relative percentages of each industry’s revenue (keyword volume * average cost per click) to Google’s 2011 revenues, excluding non-advertising revenues. The top five advertisers in each industry and their estimated spend was obtained by using data from SpyFu.com, then applying the same categorization analysis.

Erik Blachford, the second CEO of Expedia joins Gregg Brockway, founder of Hotwire and Tripit, and Brad Gerstner, founder of Altimeter Capital and Room 77 in the latest investment round.

The value of the round is not being disclosed, but is understood to be significantly less than the $13.6 million Ostrovok raised in July 2011.

That particular round also saw a string of big names decide to play in the burgeoning Russian online travel sector, including General Catalyst Partners (backer of ITA Software and Kayak) and Accel Partners (HotelTonight and others).

Others supporting the round included Peter Thiel and Founders Fund (Facebook), Niklas Zennstrom and Atomico (Skype), Mark Pincus (founder of Zynga), Esther Dyson (Yandex board member) and Fritz Demopoulos (founder of Qunar).

The local, or geo-targeted, deals sold at the kiosks will include Groupon Now (which must be redeemed that day), Feature deals and Groupon Getaways with Expedia.

The rollout of kiosks, which begins today in Chicago at places such as Navy Pier, Water Tower Place, Soldier Field and Michigan Avenue, will be expanded to other big cities throughout 2012, a Groupon spokesman says.

Here’s a Groupon concept image of the kiosks:

There is an initial plan for 100 kiosks and the rollout is expected to take up to 90 days.

This is Chicago-based Groupon’s first kiosk and offline deployment, although online travel agencies, such as Travelocity and Expedia, have tried such bricks and mortar presences in locales such as Las Vegas and Hawaii.

Groupon’s kiosk rollout comes through a partnership with smartDigital, a Chicago company offering kiosks and software.

smartDigital says its kiosks “retain behavioral data and report targeted consumer results and predictive analytics.”

Groupon says consumers will be able to pay for Groupons at the kiosks using credit cards or their existing Groupon accounts.

Groupon has consistently stated that travel is one of the pillars of its strategy and the rollout of outdoor kiosks at tourist attractions and other areas frequented by tourists is further evidence of the flash sales company’s travel ambitions.

Market leader Expedia lost 1% market share on its previous showing, as second place WebJet held its previous share of traffic and House of Travel gained over 2%.

Most popular travel websites in New Zealand for the week ending January 14 2012:

Agencies

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia.co.nz	www.expedia.co.nz	13.39%	1
2	Webjet New Zealand	www.webjet.co.nz	12.05%	2
3	House of Travel	www.houseoftravel.co.nz	10.92%	3
4	Flight Centre New Zealand	www.flightcentre.co.nz	7.35%	4
5	Jet Abroad - NZ	www.jetabroad.co.nz	3.54%	5
6	Orbitz	www.orbitz.com	2.13%	6
7	Kayak	www.kayak.com	1.88%	7
8	Harvey World Travel New Zealand	www.harveyworld.co.nz	1.71%	10
9	STA Travel NZ	www.statravel.co.nz	1.71%	-
10	FareCompare	www.farecompare.com	1.71%	8

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor	www.tripadvisor.com	6.32%	1
2	stuff.co.nz - Travel	www.stuff.co.nz/travel	5.17%	3
3	Booking.com	www.booking.com	4.49%	2
4	Wotif.com	www.wotif.com	4.27%	4
5	Yahoo!xtra - Travel	nz.totaltravel.yahoo.com	4.16%	8
6	HolidayHouses.co.nz	www.holidayhouses.co.nz	3.96%	5
7	AA New Zealand Travel Guide	www.aatravel.co.nz	2.92%	6
8	Book A Bach	www.bookabach.co.nz	2.57%	9
9	Jasons Travel Media	www.jasons.co.nz	2.16%	7
10	New Zealand Tourism Online	www.tourism.net.nz	1.73%	10

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Air New Zealand	www.airnz.co.nz	38.05%	1
2	Air New Zealand - grabaseat	www.grabaseat.co.nz	22.48%	2
3	Jetstar	www.jetstar.com	8.93%	3
4	My Air New Zealand	www.myairnz.co.nz	4.54%	4
5	Virgin Australia	www.virginaustralia.com	3.40%	6
6	AirAsia	www.airasia.com	3.25%	7
7	Qantas	www.qantas.com.au	3.12%	5
8	Emirates	www.emirates.com	2.92%	8
9	Singapore Airlines	www.singaporeair.com	2.15%	9
10	Air New Zealand - Global Site	www.airnz.com	1.13%	10

NB: Data courtesy of Experian Hitwise

NB2: Image via rook76/Shutterstock

Expedia Last-Minute Deals  takes your auto-detected point of origin and displays flight and hotel deals which other Expedia customers in your nabe have found enticing.

Expedia refers to the dynamic involved as “crowd-sourcing,” “user-generated,” and other flashy terms, but essentially the company is using its deals engine to present popular deals as evidenced by the booking patterns of other people close to your home.

In this reporter’s case, Expedia displayed deals for the Monumental Movieland Hotel Orlando ($50) starting tonight, the Riviera Hotel and Casino ($42) in Las Vegas, and roundtrip flights to Newark-Las Vegas ($253) and Newark-Atlanta ($163).

These are not flash sales, with the rates expiring within hours. And, you can book the same hotels and flights elsewhere on Expedia.com at the same rates.

Joe Megibow, general manager of Expedia.com, says the company can deliver this sort of service based on data from millions of customers.

“In a sense, the millions of people who come to Expedia are now serving as your own personal travel agent, helping you find the best and most popular deals from your home city,” Megibow says.

Last-Minute Deals apparently is currently on Expedia.com only and not other country sites.

Expedia is cashing in on the discounting trend in several ways.

In addition to this new Last-Minute Deals offering, Expedia launched ASAP flash sales more than a year ago, and the company is bullish about its partnership role in the “hugely successful” Groupon Getaways, with its vouchers and steep discounts.

Rooms and More, which eventually will be integrated into Travelport’s Universal Desktop, is a travel agency site which looks in some ways like a typical metasearch site, although the agents don’t get shuffled off to the aggregator sites to complete their bookings. Travelport acquired hotel metasearch engine Sprice in May 2010, and it provides much of the foundation for Rooms and More.

Some 6,400 travel agents in 70 markets are currently using Rooms and More so it hardly is a major booking channel for Booking.com, Agoda and the Expedia Affiliate Network so far.

But, it is interesting to see how these hotel aggregators, along with the likes of Miki Travel, Hotels.com, Grupo TransHotel, Medhotels, Hostelworld and others are competing for travel agency bookings. Travelport has a dozen aggregators in Rooms and More, with about 18 others signed up for implementation.

Niklas Andreen, Travelport GDS’ group vice president, hospitality and partner marketing, estimates that Rooms and More has 200,000 to 300,000 of an estimated half a million hotels around the world in the system.

It is difficult to give a precise count of how many hotels are represented because the providers often have overlapping inventory, he says.

The hotel providers compete for travel agency bookings based on whether they offer pre-pay or post-pay models etc. and their varying commissions.

Travel agents search for hotels and then see an array of offers from the providers with divergent commission specified.

For example, today in the US market on Rooms and More, Miki Travel was offering 12% commission, TransHotel (12%), Expedia Affiliate Network (10%), Hotels.com (10%), Booking.com (5.5%), and Agoda (4.5%).

It is likely that a company such as Expedia, which deals in so much merchant hotel inventory, could afford to pay a higher commission than Booking.com, for instance, which largely deals in the retail or agency model.

Travelport negotiates the commissions, which are subject to change by market, timeframe, availability and other factors, with each provider.

All of this inventory is accessed through the Travelport Universal API, but the aggregators also compete against chain hotels offered through the Travelport GDS, which lists commissions ranging from 0% to 12%.

Agents select an inventory provider, which is the merchant of record, and then Travelport sends the credit card details to the aggregator, which confirms the bookings and sends a voucher to the agency or traveler. Travelport collects all the commissions for the agencies.

The user experience for the travel agent is similar to traditional metasearch, although all of the bookings take place within Rooms and More instead of on sites such as Expedia or Booking.com.

Andreen refers to the experience as “meta-book.”

Also along the lines of a consumer experience, travel agents using Rooms and More get access to consumer-written hotel reviews about each property from sites such as TripAdvisor, Yahoo Travel, AOL and others.

With some travel agents disparaging what they consider to be amateurish user-generated content, it is interesting to see many of them are accessing consumer reviews in Rooms and More.

Keith Harrison, global head of hospitality sales for Travelport, says agents often access the user reviews when the property or destination is unfamiliar.

And, Andreen says Travelport is in discussions with professional review providers to add them to Rooms and More, as well.

Note: The author took part in a Travelport-sponsored press event in Atlanta.

If we look at online travel around the globe, we can see that the four key global emerging markets – Brazil, Russia, India and China – are showing substantially greater growth than the developed world.

And they are already have a significant share of global online travel consumption.

This is beginning to show itself in the distribution of value – out of the top five most valuable publicly traded OTAs, three are outside the US (CTrip, MakeMyTrip and eLong). But who wins in those markets, and, more importantly, why?

In this article I am arguing that local players have an overwhelming advantage versus global players, and also describing the key characteristics of the local players that end up winning.

This perspective is based on our experience building Ostrovok (an online hotel booking product for the Russian market), as well as extensive research on key winners and losers in China, India and Brazil.

Why being local is an overwhelming advantage

At first glance it isn’t clear why the market leaders in BRIC countries are local. It seems that the Pricelines and Expedias of the world have significant advantages:

• Large pools of capital
• Established global supply bases appealing to BRIC consumers
• The ability to direct significant flows of global customers to BRIC hotels
• Experience developed over many years of success.

However, those advantages aren’t as significant as they initially seem:

1. Funds

Capital isn’t an advantage against local teams that know how to raise it.

A BRIC startup can raise $100 million in venture capital to invest on the way to success; any public company executive that spends that much money to fight in a non-core market will have the shareholders clamouring for his head.

2. Supply

Global supply is freely accessible through many of the local and global market leaders that are looking to aggregate demand into their core markets via affiliate partners.

3. Customers

Global customer flow to BRIC hotels is important, but:

• Local customers eventually become the dominant source of local hotel demand
• Global customers have little brand loyalty to global OTAs: they metasearch and go to whoever has better rates/availability for the BRIC hotel, i.e. the local OTA.

4. Legacy

Experience is of dubious value. Most successful Internet companies were built by outsiders because in rapidly changing markets flexibility matters more than legacy knowledge.

For evidence of this, look no further than at how online travel incumbents struggle with exploiting new distribution channels (social/mobile).

On the other hand, local players have substantial advantages that aren’t immediately obvious:

• Local fulfillment
• Local marketing
• Local supply

Let’s look at those elements in further detail:

Fulfillment

1. Local Payment Solutions.

The way people pay online varies significantly from country to country.

This is why CTrip has messengers collecting cash from people; Despegar sells a large portion of its hotels on installment plans; and Ostrovok processes payments via ATMs and mobile retailers. Global players do none of this, and lose a huge chunk of potential customers as a result.

2. Local customer support.

Consumers in BRIC countries need telephone support and transactions; help with visa issues; help learning to trust the Internet.

For example, CTrip embraces high-touch customer support, staffs its call centers with thousands of people and delivers a level of service unmatched in the West – a live agent answers 99%+ of calls instantly 24/7.

This enables the development of far greater trust with consumers.

Marketing

1. Local channels.

As the platforms through which users can be reached are substantially different in emerging markets, local marketing focus is a substantial advantage. SEM/SEO on Baidu or Yandex is quite different from CPC on Google; other channels with negotiated deals are even more so.

2. Local offline marketing.

Global players tend to be unable to stretch their organization to do offline advertising and tend not to appreciate its strength.

For example, MakeMyTrip in India or Despegar in Brazil both used TV campaigns to build much stronger brands than the global players.

3. Local culture focus. It should be self-evident that a person in another country that doesn’t even speak the local language can’t notice the nuances of cultural perception, morphology and many other issues obvious to locals.

Supply

1. Local focus.

Hotel supply is a high-touch, local business driven by relationships. As a result, over time local OTAs take the lead in terms of breadth of hotel coverage and in terms of rates and availability domestically.

This has already happened in Brazil, India and China and is happening in Russia right now.

2. Local hotel solutions.

By being attentive to the needs of local hotels, superior results can be delivered. For example, CTrip and eLong in China work with hotels in an on-request fax-based way, as well as via an extranet, and even today approximately 40% of Ctrip’s bookings are done this way.

Another example is that Ostrovok in Russia uses local-law contracts which are significantly preferred by local hotels for tax and accounting reasons.

Getting a strategy

Overall, a good way to summarize the advantages of a local player is that they are developing a custom solution for the local market, which is an easy sell against one-size-fits-all template solutions provided by global OTAs.

A final note to make here is that while the particulars may vary, the dominance of local Internet companies in emerging markets is not unique to online travel.

China is well-known for this, but the same is true in Russia, where hardly any of the Western internet companies have succeeded. Google trails Yandex with one third of its market share. Facebook is only the 4th biggest social network.

Groupon (which started as a leader in a market it has invented) has been overtaken by local player Biglion. Amazon, eBay, LinkedIn, Zynga and other global titans are nowhere to be seen.

So while many global players will attempt to compete in emerging markets, there is no reason to believe that they will be successful

What determines which of the local players will win?

Now that we have established that local beats global in the online travel industry, which of the local players actually do win?

In the process of figuring out the right strategy for Ostrovok, we have attracted investors/advisors from key global players in developed and emerging markets, and have done a lot of research on such players.

We have learned a lot about the strategies used and reasons behind the success of CTrip, eLong and Qunar in China; MakeMyTrip, Yatra and Cleartrip in India; Despegar and Viajanet in Brazil.

When we asked those players and their competitors about what determined the winners, the first factor everyone mentioned is “a very strong team”.

This was too obvious and generic an answer, but when we dug deeper we found three specific unifying characteristics at the winners in China, India and Brazil:

• Prior knowledge of the local market in executive teams.
• Technical engineering ability on the team.
• Ability to raise Western capital on the team.

What was also fascinating was that those three strengths taken together worked to create significant competitive advantages. Having talented engineers brought in more talented engineers.

Having executives with local experience helped bring in suppliers. Having the technical and supply capabilities brought in more capital, which helped bring in even more talent.

Once this virtuous cycle got started, other local players were unable to catch up.

How we built our strategy as a result of this research

So when we started Ostrovok, we built our strategy versus domestic competition around these key strengths:

• We are unique amongst all Russian online travel companies in that we have a team of more than 25 people who write code (not counting QA, designers and the like), many of them from top tech companies in Russia like Yandex. Techology is always the bottleneck to all other parts of the organization, and we are planning to expand to 150 people writing code by the end of 2012.
• We used local supply expertise to build the largest hotel supply acquisition team in Russia, and grow our local hotel supply base faster than that of any other player. This was done by Andrew Pyner, who was previously CEO of the Russian office of Booking.com, led Russian supply acquisition efforts for Expedia and GTA, and worked for Radisson in St Petersburg.
• Because of the strength of the team (and the past experience of the founders as entrepreneurs in Silicon Valley), we have been able to raise more capital than all other local players combined from leading global investors – General Catalyst, Accel and a number of others.

In conclusion, our prognosis is that the winners in emerging online travel markets will turn out to be local players with strong technical teams, a deep understanding of local suppliers, and the ability to raise a lot of capital.

And, over time, today’s situation will be reversed as those younger, faster and more aggressive players will begin to compete in developed countries.

NB: This is a guest article by Serge Faguet, co-founder of Ostrovok, a Russian-based hotel-focused online travel agency.

NB2: Image via shutterstock.

Orbitz saw its share of the agency category rise by 0.5% in the close spread across second, third and fourth positions, putting it 1% behind Priceline.

Expedia continues to hold the premier spot, securing almost 13% share of the agency category.

Most popular travel websites in the US for the week ending January 14 2012:

Agency

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Expedia	www.expedia.com	12.70%	1
2	priceline.com	www.priceline.com	8.84%	2
3	Orbitz	www.orbitz.com	7.59%	3
4	Travelocity	www.travelocity.com	6.45%	4
5	CheapOair	www.cheapoair.com	5.72%	6
6	Kayak	www.kayak.com	5.41%	7
7	Yahoo! Travel	travel.yahoo.com	4.94%	5
8	Hotwire	www.hotwire.com	4.88%	8
9	Cheap Tickets	www.cheaptickets.com	2.68%	9
10	bookingbuddy	www.bookingbuddy.com	2.50%	10

Destinations and Accommodation

Rank	Website	Domain	Percentage of Visits	Previous Position
1	TripAdvisor	www.tripadvisor.com	8.71%	1
2	Marriott International	www.marriott.com	2.89%	2
3	Hotels.com	www.hotels.com	2.86%	3
4	Vacation Rentals by Owner	www.vrbo.com	2.24%	5
5	Hilton Hotels Online	www.hilton.com	2.13%	6
6	Carnival Cruise Lines	www.carnival.com	2.12%	4
7	InterContinental Hotels Group	www.ichotelsgroup.com	1.97%	7
8	Booking.com	www.booking.com	1.89%	8
9	USA Today - Travel	travel.usatoday.com	1.83%	-
10	Walt Disney World	disneyworld.disney.go.com	1.64%	9

Airlines

Rank	Website	Domain	Percentage of Visits	Previous Position
1	Southwest Airlines	www.southwest.com	22.57%	1
2	Delta Air Lines	www.delta.com	11.99%	2
3	American Airlines	www.aa.com	9.62%	3
4	JetBlue Airways	www.jetblue.com	7.78%	4
5	Continental Airlines	www.continental.com	6.53%	5
6	United Airlines	www.united.com	5.62%	6
7	US Airways	www.usairways.com	5.23%	7
8	AirTran Airways	www.airtran.com	4.29%	8
9	Allegiant Air	www.allegiantair.com	3.81%	9
10	Spirit Airlines	www.spiritair.com	3.37%	10

Travel search terms

Rank	Search Term	Percentage of Clicks	Percentage Paid	Percentage Organic	Previous Position
1	mapquest	4.01%	0.11%	99.89%	1
2	google maps	1.37%	0.85%	99.15%	2
3	southwest airlines	1.35%	40.92%	59.08%	3
4	expedia	0.79%	49.85%	50.15%	4
5	maps	0.76%	0.67%	99.33%	5
6	travelocity	0.69%	53.19%	46.81%	7
7	map quest	0.65%	0.26%	99.74%	6
8	continental airlines	0.60%	8.72%	91.28%	8
9	american airlines	0.56%	3.27%	96.73%	9
10	google earth	0.50%	20.56%	79.44%	10

NB: Data couresy of Experian Hitwise

The move follows what the company says is the significant success of its Top Secret Hotels service, a product which now sees around 50% of customers buying accommodation the day before needing it.

For car hire, visitors to the site can choose a type of vehicle and location, but the supplier brand is not disclosed until after the booking is made (triggering a 10% discount).

Recently installed new CEO Matthew Crummack says vehicles will only supplied by its regular partners such as Alamo, Avis, Thrifty and Europcar.

A similar system is in operation for products such as theatre tickets, where visitors can select a show type (musical, play, etc) but not the specific performance, in return for a guaranteed ticket in the “top three seating bands”.

The decision to extend the opaque model to new areas is the first significant move by Crummack since joining as CEO from Expedia in August 2011.

He says the widening of the Top Secret service is part of a bigger effort to pull Lastminute.com back to its original concept of being a late-booking service, and build on the “lifestyle” elements of a trip, such as attractions and other in-destination products.

Although the brand remains strong in flight-only, package holidays and hotels, Crummack believes online travel agencies without a unique offering will find life difficult as the already-crowded marketplace feels the pinch from the economic pressures around Europe.

“If you are not clear to customers about what you are and what you stand for – in our case its great and quick getaways, and value – it’s going to be a very tough world out there. We have no desire to play the averages.”

This week’s most significant development in the hotel space for a number of years, the launch of the multi-brand Room Key service, has not gone unnoticed at Lastminute.com, especially as some consider online travel agencies to be the mostly likely to suffer if the service succeeds.

“There are some very strong hotel brands involved,” Crummack says, “and having them coming together like that is a welcome move.”

Lastminute.com will be speaking to each of the brands individually over the coming months to make sure there are better and more valuable ways of working together, he adds.

The apparently sudden exit of Durschslag, who focused on expanding Expedia Inc.’s global marketshare as president of Expedia Worldwide, is the second high-profile departure from the company in the past few months.

Expedia Inc. CFO Michael Adler resigned recently and was replaced by Mark Okerstrom. Adler’s exit was widely seen as related to the TripAdvisor spinoff and the prospect of his heading up the fiscal responsibilities of a downsized company — Expedia without TripAdvisor.

An Expedia Inc. spokeswoman provided few details about Duschslag’s departure other than confirming he resigned and noting that Khosrowshahi will assume Durschslag’s duties as president of Expedia Worldwide while retaining his CEO role, as well.

Durschslag’s departure comes as Expedia prepares to report its 2011 earnings within a few weeks.

One wonders if Durschslag’s resignation is related to Expedia Inc.’s international performance as it chases Priceline and its Booking.com unit in the global hotel business.

But, that is speculation for now.

There have been rumors of a reorganization of sorts in the works at the company and perhaps Durschslag’s resignation is part of that effort.

And, is Expedia chairman Barry Diller sending a message by putting Khosrowshahi directly in charge of the company’s international expansion effort?

Durschslag’s LinkedIn profile says he joined Expedia in December 2010, while the Expedia website says he was hired in early 2011.

Durschslag most previously was COO at Skype.

Their you’ve-got-a-lot-to-prove attitudes emerge as Room Key, a hotel metasearch site launched this week by founding US hotel chains Choice Hotels, Hilton Worldwide, Hyatt Hotels, InterContinental Hotels, Marriott and Wyndham, announced that Best Western has signed on as Room Key’s first commercial partner.

Best Western adds some 4,000 hotels to the party, which is a celebration of hotel website bookings and a flexing of their collective muscles in a bid to diminish the distribution power of the OTAs.

Jake Fuller, an analyst at Lazard Capital Markets, notes that similar efforts in the form of European site Andbook more than a decade ago and US site Travelweb a few years later both failed.

And, while Fuller believes Room Key is a larger threat to Expedia because of its relatively US-centric hotel business than to Priceline, his firm maintains a “buy rating” on both stocks.

Although Room Key is chain-driven, “the bulk of the rooms sold by Expedia and Priceline are independents and each offers a much better picture of the market,” Fuller says.

For example, Room Key was showing 23 hotels available in New York City while Expedia displayed 532 and Booking.com offered 390, Fuller says. Similarly, the London numbers were Room Key (24), Booking.com (1,199) and Expedia (970).

“Limited inventory could limit the appeal,” Fuller says of Room Key, adding:

While Roomkey.com does offer international hotels, it is focused on US travelers, with plans to roll out to other English-speaking markets in the future. Because chain inventory is thinner abroad, we do not see Roomkey.com as a real threat to Expedia or Priceline outside of the US.

Herman Leung, an analyst at Susquehanna International Group, concurs with Fuller that Room Key is more of a perceptual problem than a fundamental one for Priceline and Expedia.

“To be successful will require significant marketing dollars and significant commitment from all of these hoteliers, which I think will be a lot harder than they think it is,” Leung says.

Room Key is a “slight negative” to the OTAs, Leung argues, and he wonders if the chains will divert monies from their direct-marketing efforts into Room Key.

Alexa currently gives Room Key a global traffic rank of 20,841,200, and it would have to increase its ranking to be in the top 10 of travel websites with perhaps 30 million monthly unique visitors to put the heat on the OTAs, Leung says.

Expedia has long-term contracts in place with most, if not all, of the Room Key founders, and if one decides to limit the inventory it assigns to Expedia, then another will take advantage, Leung says.

“This is not an Orbitz,” which was founded by five major US airlines, Leung says, adding that the hotel industry is much more fragmented than the airline industry.

Conceding that Room Key “has far from a 100% certainty of success,” Brian Nowak, an analyst at Nomura Securities is more bullish on Room Key’s prospect than are Fuller and Leung.

“Given the initial US rollout, Expedia is the most directly threatened by this site as US hotels represent an estimated 35-40% of revenue,” Nowak says. “For Priceline, we estimate only about 15-20% of gross profit is from domestic hotels, although Room Key does pose a threat to Booking.com’s ability to gain significant US marketshare.”

Nowak believes that hotel chains participating in Room Key will present nonbookers with pop-up windows advertising Room Key as they leave the hotel websites.

“We estimate that this strategy has the potential to extend Room Key’s reach to over 13 million unique visitors, larger than all of the current OTAs’ traffic,” Nowak says.

Will that be the secret  weapon?

It’s seemingly a dubious proposition.