In the last round of GDS negotiations in 2007, airlines such as American Airlines and Delta Airlines stridently warned that they would pull out of major GDSs if the carriers didn’t get their way.

In 2010, American is pledging to go outside of the GDSs again, this time through Farelogix, and JetBlue, in more thoughtful tones absent the rhetoric, is pushing the message that the airline-GDS business model is broken and must change, leading up to negotiations next year.

Noreen Courtney-Wilds, JetBlue’s vice president, sales, says the industry took “baby steps” in the last round of negotiations.

After those talks, the airlines reduced the booking fees they had to pay GDSs, and the GDSs made themselves whole to a large extent by greatly reducing the incentives they pay to travel agencies.

“We all kind of know the financial model needs to change,” Courtney-Wilds said in a panel discussion, “Future of Distribution Forum,” at the TravelCom conference in Dallas yesterday afternoon.

She adds: “If it doesn’t change, folks will look for other ways to solve it.”

Courtney-Wilds notes that JetBlue recently transitioned to the SabreSonic reservations’ system and ratcheted up to full participation in the four major GDSs.

The upside is that JetBlue picked up incremental business from the GDS channel, but the downside of “opening up the floodgates” is that there was an increase in travel agencies “snatching up seats that you didn’t need help filling in the first place” at a higher distribution cost, Courtney-Wilds says.

She says JetBlue doesn’t need help selling $49 tickets and, referring to increased GDS distribution costs for sometimes low-yielding tickets, Courtney-Wilds adds, “we definitely have to address [that] going forward.”

Asked what was on her wish list as far as a new financial model, Courtney-Wilds says she doesn’t have all the answers, but that the solution should lead to a variable structure where the airline can pay for distribution in areas where the carrier wants to play — and presumably not pay in less-cost-effective areas.

One reason JetBlue opted to go full-throttle in the GDSs is that it gives the airline the opportunity to tap into the high-yielding corporate-travel business in certain markets.

Referring to a lot of noise these days about airline direct-connects bypassing GDSs, Courtney-Wilds says technical issues aren’t the basis of the conversation and all of this talk will be silenced once the airline-GDS financial model is fixed.

Fellow panel member Dan Westbrook, vice president, supplier development in the Americas for Travelport GDS, told the audience that the business model may need to be “fine-tuned,” adding that most airlines are willing to pay for high-yielding business.

He adds that Travelport GDS is talking to suppliers, looking for opportunities and trying to find the right balance.

Westbrook says the ultimate solution may vary, sector to sector.

Courtney-Wilds also had some stern, if polite, words for metasearch engines, too.

In the past, she says, JetBlue’s fares would appear in metasearch engines and consumers would link into the booking path on JetBlue.com, the airline’s cheapest distribution channel.

However, today JetBlue’s inventory is displayed in metasearch along with several other booking choices in the same results box and there are greater distribution costs for the carrier if consumers book through online travel agencies instead of going to JetBlue.com.

“The economics of the channel have changed and we are looking at that,” Courtney-Wilds says.

The chatter generated by Kayak when it announced it is considering adding a booking element into its model appears not to have inspired others to think the same.

But whereas the topic was rarely mentioned before, such was the determination by metasearch players to keep the model simple, it is now, by virtue of Kayak’s move, getting some air time.

For example, Skyscanner and Swoodoo, both enjoying success in Europe in the metasearch sector, are far more philosophical about setting off such a seismic move to their existing businesses.

Take Skyscanner co-founder and chief executive Gareth Williams. He acknowledges the huge implications such a move by Kayak could have on the marketplace.

Is Skyscanner ruling it out?

Ask any metasearch player just two years ago if booking was an option they would consider and the answer would’ve been dismissed.

Not any more – Kayak appears to have changed many of its rivals’ thinking. Williams now says booking is “on the list” of things to do.

He quickly adds the caveat that the company needs “to get search right first”.

Christian Saller, CEO of Swoodoo, admits that booking is actually “something we discuss now all the time”.

So from fiercely defending the metasearch model for years (almost the reverse of Cheapflights and its proud defence of price comparison  until the launch of Zugu), in a short space of time the market has changed its thinking once again.

Among the three U.S.-based public company online travel agencies — Expedia, Priceline and Orbitz Worldwide – Jake Fuller sees Expedia and Orbitz closing the gap a bit on a global basis with “outperformer” Priceline in 2010.

Fuller, PhoCusWright’s senior research analyst, finance and analytics, says Expedia, Orbitz and presumably privately held Travelocity, will move toward leveling the playing field in the U.S. this year while Priceline will continue to gain share internationally.

One thing driving the tilt toward relative parity in the U.S. is that Expedia, Orbitz and Travelocity eliminated airline booking fees in 2009, eliminating Priceline’s first-mover, no-fee advantage. Priceline retired its air-booking fees in 2007.

As a group, the Big Four OTAs have been picking up market share in the U.S., with their share of domestic online bookings increasing from 36% in 2008 to 38% in 2009. [Their share of OTA bookings in the U.S. climbed from 94% in 2008 to 97% in 2009, Fuller says.]

In Europe, Expedia, OWW, Travelocity and Priceline had about a 67% market share in 2009, and Fuller predicts that — based on their marketing power and critical mass — that share will rise in 2010.

After all, he argues, there is little differentiation among them — they are all selling the same airline tickets — so marketing dollars will rule the day.

Fuller was addressing OTA and other issues today in a webinar, “PhoCusWright’s Travel and Finance Outlook 2010.”

With Travelport’s decision to pull it’s IPO, Fuller believes it will be very difficult to go ahead with other GDS IPOs [ i.e. from contenders Sabre and Amadeus] in 2010, and this makes OTA consolidation less likely.

Fuller had earlier argued that GDSs Travelport and Sabre might divest their stakes in OWW and Travelocity, respectively, if the privately held GDSs transformed themselves into stock symbols.

For example, there is less of chance that OWW is for sale today than there was when a Travelport IPO was in the cards, Fuller says.

One reason for Fuller’s bearishness on GDS IPO prospects is that he says the markets usually look one year ahead and what they see staring at them is airline-GDS contract negotiations in 2011.

And, uncertainty doesn’t inspire IPO confidence.

Fuller estimates that with their fee cuts, the OTAs likely earn less than $10 per airline ticket today, and that after the 2011 negotiations, the airlines probably will pay less to the GDSs, who will squeeze travel agencies — the OTAs included — a bit more.

There will likely will still be merger and acquistion activity by OTAs in 2010, but Fuller doesn’t look for them to be buying one another in a consolidation wave.

Instead, he believes Expedia might be expected to add to its media portfolio while Priceline will look for hotel-inventory and geographic deals rather than seeking out big brands to scoop up.

“That’s not their style,” Fuller says, referring to Priceline.

In recent years, metasearch engines have become less of a competitor to OTAs and more of a traffic source, and Fuller sees the OTAs — given the ever-increasing pressure on their airline-ticket compensation — experimenting more with their own metasearch or search products, as TripAdvisor has done with Flights and OWW has done with several websites, including its Away.com.

If the OTAs become a casualty of the airline-GDS negotiations, metasearch will “make more sense to them [the OTAs],” Fuller says.

You’d never say accuse Priceline President and CEO Jeffery Boyd of waxing nostalgic about metasearch because, as the head of an online travel agency, he has been a metasearch critic since its earliest days.

Still, speaking at the Goldman Sachs Technology and Internet Conference 2010 in San Francisco today, Boyd says metasearch’s best days are behind it.

Metasearch

“In some ways, the market has moved to another time and place around that,” says Boyd, referring to metasearch.

The Priceline exec says the OTAs’ decision to remove booking fees on airline tickets took away much of the consumer benefit in using metasearch, with its heavy reliance on air, since there now is wide pricing parity on airline tickets across channels.

Looking back on the short history of metasearch, Boyd says what happened to the sector is that one player — Kayak — “has grown very substantially” while the others haven’t.

Still, he notes that Priceline views metasearch players as advertising partners for airline tickets, although hotels are a much larger focus of Priceline’s business.

Private Sales

On other issues, Boyd says he views private sales, as practiced by Jetsetter, Kayak and Travelzoo as “niche businesses,” which will remain very small compared with the online travel agencies.

Boyd says it’s “hard to see how they will scale” when they offer limited-time sales for a limited number of properties.

He adds that hotels won’t “dedicate material amounts of inventory” to private sales and thus a consumer would have a “fractional” chance to find a San Francisco hotel deal on Jetsetter for the dates the consumer desires.

Boyd doesn’t see Priceline offering private sales and adds that the company already addresses that market through Name-Your-Own Price.

No Opaque for UK

Boyd doesn’t envision Priceline trying to resurrect a Name-Your-Own Price offering in the U.K. because mounting such an effort would be very difficult and he doesn’t want to get distracted from the company’s primary focus in Europe, building Booking.com.

Priceline tried to launch an opaque offering in the U.K. several years ago and it “wasn’t very successful” because hotel inventory in Europe is fragmented and the star-ratings systems are inconsistent, he says.

“I think it is a more difficult proposition there [Europe],” Boyd adds.

Hotel-only in Europe gives Expedia, lastminute.com an Advantage

With Priceline’s focus on hotel-only Booking.com in Europe, Expedia and lastminute.com get an advantage because they offer vacation packages, Boyd says.

That means Priceline won’t be able to attract certain travelers who prefer to shop for packages.

Still, Boyd says Priceline is not working on a vacation-package business for Europe.

Also, in the advantages-disadvantages sphere, Boyd acknowledges that Expedia has a better ability to merchandise promotions than Priceline has as Expedia got into the merchandising-promotions game earlier than Priceline did.

Dual Strategy for Asia

Boyd likes Priceline’s strategy of seeking to gain traction in Asia markets by entering the region with its two subsidiaries, Booking.com and Agoda.

Boyd says hoteliers in Asia can control their own pricing through Booking.com, which uses a retail/agency model.

Meanwhile, he says, Agoda uses the merchant model and can drive demand to the hotel from within Asia, while Booking.com can spur international demand.

Thus, Priceline has a dual strategy for the Asia hotel duel and Boyd likes that just fine.

Zugu, the fledgling metasearch brand from Cheapflights, is already looking at adding other elements to its flight search such as hotels and car hire.

The Zugu site was officially unveiled in beta last week as a flight-only search engine, but bosses say products could be added to push it in line with competitors.

Many of the existing travel metasearch providers launched as flight-only sites and then pushed in services such as hotel, car hire and package holiday search.

Skyscanner, TravelSupermarket, Kayak and others all started with a similar principle and have slowly grown to act as first-stop-shops for a wider range of travel products.

Most recently, Fly.com – Travelzoo’s young metasearch engine – said it may have hotel and car hire by the end of the year.

Chairman Hugo Burge says:

“It would be natural for us to add to the Zugu business over time.”

However, Zugu does not see an immediate need to copy the Kayak model of providing booking facilities to users via mobile, claiming at this stage the move only “raises the bar for mobile”.

British Airways is starting to suffer the medium to long-term effects of its ongoing dispute with cabin crew, not least in the amount of traffic its website receives from metasearch engines.

TravelSupermarket claims the industrial dispute at British Airways was already being felt long before today’s strike ballot result.

Unite, the trade union representing cabin crew in their long running fight against managers over working conditions and pay, today revealed strong support by members to organise industrial action mostly in the form of strikes.

TravelSupermarket says following the announcement of the latest ballet in mid-January 2010, clicks from the metasearch site to flights on BA.com have slumped by 19%.

The union says it will continue to attempt to reach a settlement with BA bosses and has yet to announce dates for a strike, although the threat of industrial action is clearly making travellers nervous.

An original strike set for Christmas 2009 was deemed unlawful at the time in the High Court as ineligible members were balloted.

Bob Atkinson from TravelSupermarket says:

“Today’s result isn’t just a kick in the teeth for loyal BA passengers, it’s a disaster for both British Airways and BA’s staff, as all stand to lose out unless the airline re-engineers itself to compete in the cut-throat airline market.”

Zugu is the strange name of the new metasearch engine from price comparison firm Cheapflight, unveiled in public beta today after months of development and testing.

Three months after Cheapflights revealed it was intending on launching a metasearch product, ironically after fiercely defending the deals publishing model for years, executives have outlined Zugu’s strategy for the first time.

The engine is being touted as a “next generation” metasearch product which chief executive Chris Cuddy says has been created after watching and learning from what the existing meta players have developed over the years.

Central to the system, Cuddy and chairman Hugo Burge outlined in a briefing today, is a simpler design, user interface (”we have ruthlessly cut out the clutter”) and complete transparency of pricing from airlines and online travel agency partners.

The launch of Zugu will begin in the UK in beta and be rolled out worldwide in phases. Cheapflights is already resident in the UK, Canada, US, France, Italy, Germany, Australia and Spain.

Cuddy says the site will have more fare partners than any other meta player in the coming months with a mixture of direct-connects to airlines and agreements with OTAs.

Some of the filter tools developed for the system include the ability to group and filter by price and airline, departure and return time, and journey duration.

The highly sought-after Ryanair product line is included at launch as well as agreements with Expedia, Lastminute.com, Opodo and Ebookers.

Zugu’s emergence as a major new element to the business coincides with the formation of a new name, Cheapflights Media, as the umbrella organisation over the existing Cheapflights brand and the new meta product.

The intention is to make Cheapflights Media one of the top three travel media brands in the worldwide “within a few years”, going up against the likes of Travelzoo  and TripAdvisor on the global stage, Kayak, Farecompare and Bing in the US and Skyscanner and TravelSupermarket in the UK initially.

Cuddy says the decision to launch Zugu follows thorough examination of how people used the Cheapflights system when looking for deals and how – through other meta brands – consumers wanted to obtain fares on specific dates.

Burge admits that the long-standing ties established with major OTAs and airlines for deals have helped launch the Zugu product.

“We are going to leverage the relationships we already had through Cheapflights,” he says.

The technology behind the engine was created in-house and overall development of the project supported financially by the Cheapflights business.

There is no significant marketing strategy planned for the beta phase of Zugu apart from social media seeding through Twitter and Facebook and a competition to encourage users to guess the origin of the name.

The site has been live for at least seven weeks but, as Burge admits, this has been done discreetly in order to carry out quiet user testing.

Australia-New Zealand online accommodation service Wotif is aiming to unsettle some of the biggest players in the region’s flight search and booking sector with the launch of WotFlight.

The new service launched today and is initially targeting domestic flights in and around Australia, with plans to expand into regional and long-haul flights over time.

Another flight search and booking system wouldn’t ordinarily capture huge amounts of attention, but the pedigree and experience behind the Wotif mothership is likely to make its new rivals in the airfare area take note.

Wotif.com launched in 2000 as an online distressed hotel inventory service, but quickly extended its booking time and global reach to challenge some of the biggest names in the Australasian region.

It is now one very few businesses to dominate a market instead of Expedia-owned TripAdvisor in accommodation rankings on Hitwise, courtesy of its running start and strong brand in Australia.

Wotif is currently almost 2% ahead of TripAdvisor in market share and 4% and 5% ahead of Booking.com and HotelClub respectively.

The new WotFlight brand is being touted as a “natural progression” for the wider group by its CEO Robbie Cookie.

Inevitably the two brands will work closely alongside each other as visitors to the new site will be offered accommodation vouchers on the sister site.

The fighting talk has already started, with brand manager Megan Magill claiming supremacy over content and functionality against its new rival in the flight search sector before the site even launches.

Webjet, Flight Centre and the Australian divisions of Expedia and lastminute.com currently top the Hitwise rankings in the agency categories.

Budget Center, a mash-up of budget-oriented travel domains. launched an interim website, BudgetAirlines.com, featuring Kayak metasearch. And, oh yes, the website has Google AdSense, too.

Robert Chalmers, president and CEO of Budget Center, says BudgetAirlines will carve out a niche by offering budget carriers only, and that way it doesn’t have to “go head-to-head with the giants of the industry,” namely Travelocity, Expedia and Orbitz.

“After all, the spirit of thrift is not simply a fad or trend,” Chalmers says. “I would say that it is here to stay.”

So, while Budget Center constructs the “look and feel” of the next incarnation of BudgetAirlines.com behind closed doors, it launched the interim website with Kayak powering the air search. Of course, it features hub-and-spoke and low cost carriers, too.

Once the website gets launched in its own image, Budget Center will be out soliciting its own ads, and won’t be reliant on Google ads, Chalmers says.

One reason for launching BudgetAirlines on an interim basis is that it may drive traffic to BudgetHotels.com, which uses HotelsCombined to source inventory, and is good for SEO purposes, too.

Chalmers earlier talked of offering Southwest Airlines on BudgetAirlines, but now concedes “we will have most discount airlines. Southwest is tougher.”

He does point to a Southwest ad from Google that’s on the site.

But, more than a few other websites have these ads, too.

Fresh from being cited by Google as a key competitor, Kayak is rolling out its trip planning tool to the UK market this week and also unveiling a major upgrade to its iPhone app.

The Kayak Trips feature launched in the US in October 2009 and was seen by some as a contender to the itinerary management market currently spearheaded by the likes of TripIt and Traxo.

The UK version includes all of the existing trip planning features launched last year such as flight details, hotel bookings and activities into a trip itinerary.

Central to the service is a tool (similar to the TripIt system) which allows users to email their booking confirmations to Kayak for automatic inclusion in the system.

Executive vice president for corporate development, Keith Melnick, now also looking after European operations following the exit of managing director Faisal Galaria last year, reckons visits to Kayak from Europeans doubled in January.

Later this week will also see an upgrade to Kayak’s iPhone app. The new version will include enhanced search tools and flight tracking, email sharing and hotel photos as well as a baggage fees function to display prices of luggage costs on every airline.

No word as yet when the booking tool will be launched.

Some folk in Connecticut, US, will be scratching their heads as feverishly as they are digging their way through the snow this weekend after Google named the metasearch firm Kayak on its list of competitors.

The Norwalk, CT-based company was named in Google’s 2009 Annual Report – filed with the Securities and Exchange Commission on February 12 2010 – alongside the likes of Monster, eBay and Amazon.

This is the first time that Google has named vertical search companies as competitors, normally only reserving such flattery for software and search companies such as Microsoft and Yahoo.

The Annual Report says:

“Our business is characterized by rapid change and converging, as well as new and disruptive, technologies. We face formidable competition in every aspect of our business, particularly from companies that seek to connect people with information on the web and provide them with relevant advertising.”

It then goes on to list:

• Traditional search engines, such as Yahoo! Inc. and Microsoft Corporation’s Bing.
• Vertical search engines and e-commerce sites, such as WebMD (for health queries), Kayak (travel queries), Monster.com (job queries), and Amazon.com and eBay (commerce). We compete with these sites because they, like us, are trying to attract users to their websites to search for product or service information, and some users will navigate directly to those sites rather than go through Google.
• Social networks, such as Facebook, Yelp, or Twitter.

Further on in the report, Google says competition will have a long-lasting effect.

“We believe our revenue growth rate will generally decline as a result of a number of factors including increasing competition, the inevitable decline in growth rates as our revenues increase to higher levels, and the increasing maturity of the online advertising market.”

When asked about being cited as a competitor, Kayak chief marketing officer Robert Birge says the company has a “great relationship” with Google as an advertising medium, but adds humbly:

“I’m a bit surprised that we would be called out given our size (I’m pretty sure that Google has a bigger janitorial staff in their NY offices than our 97 employees) and given that using the much larger OTAs are also a substitute behavior for using a search engine.”

Tnooz posted the following question on Twitter:

“Imagine you were cited as a competitor by Google. Would you be a) flattered b) terrified c) start prepping those sale documents?”

One public response from Sunshine.co.uk boss Chris Clarkson and a handful via DM said simply: all of the above.

Travelzoo-owned Fly.com will launch a dedicated German site by the end of March 2010 – but bigger developments are set to come with confirmation that car hire and hotels are now firmly on the agenda.

Fly.com currently has sites for the US and the UK markets and will unveil its first non-English language platform in Germany “imminently”, says Brian Clark, senior vice president and general manager for the fledgling service.

More importantly is a hint that adding more channels to the service has become a serious consideration with Clark suggesting car hire, hotels and package holidays may be added to the site by the end of the year.

The comments come on the back of an earnings report from the Travelzoo Inc mothership this week when outgoing Travelzoo CEO Holger Bartel admitted the young metasearch site had incurred significant losses in its first year (Fly.com was unveiled in Beta on February 9 2009).

Despite the startup costs, Bartel says the metasearch business remains attractive and the priority for 2010 is to grow the Fly.com audience and revenue, although for the moment it remains a fraction of the wider revenue pot at Travelzoo.

Clark says the division will have up to 15 staffers by the summer of 2010.

Interestingly, Clark says he is “very pleased with where we are” in terms of overall traffic for the site – citing Compete figures which indicate between 500K and 700K uniques a month – but Bartel was noted as saying in the earnings call that traffic was less than hoped for.

Although Fly.com has managed in Europe to secure low cost carrier giant Ryanair, one of more traditionally difficult airlines to attract to metasearch, it still pursuing Southwest in the US alongside every other meta player.

Travel metasearch once was lean, mean and hungry, but now it seems that websites like Fly.com and Kayak may be getting a bit wimpy, and might be forsaking consumers’ needs in deference to the sensitivities of online travel agencies and airlines.

In the early days of travel metasearch, consumers could use metasearch websites to compare prices of flights and hotel rooms, and in the search-results grids you’d find flight ticket and room prices from various airlines and intermediaries lined-up side by side.

Ah, those were the days, a seemingly bygone era.

Look what’s happening now.

The following is a Fly.com results’ display for a Newark-Fort Lauderdale flight on US Airways.

While consumers can readily see that they can book the US Airways flight on Travelocity for $403, the Hotwire price is a blank — and a mystery.

To see if Hotwire — a discount travel website — beats Travelocity on price, you’d have to click on the Hotwire link and navigate to Hotwire.com, where you’d see the following display.

Hotwire is offering a bunch of US Airways flights for Newark-Fort Lauderdale for $402.80 — and that may be the issue. Hotwire — which declined to comment for this story — probably doesn’t want to see its prices displayed next to Travelocity — or other competitors — over and over on metasearch websites because Hotwire isn’t offering travelers any kind of a deal in some instances.

This sort of prices-gone-missing approach apparently is becoming more common on metasearch websites as players like Fly.com and Kayak give in to the brand sensitivities of online travel agencies and airlines.

In so doing, the metasearch websites may be doing a disservice to consumers, many of whom certainly want to view the price of a flight or car rental without having to click over to another website.

I am sure the travel-metasearch engines would love to do right by consumers and display as much pricing as possible, but they are letting the OTAs, in these cases, conduct their merchandising efforts in ways that may not be in the best interests of consumers.

Expedia.com, a sister company of Hotwire’s in the Expedia Inc. portfolio, is taking a somewhat similar tack in Kayak’s hotel displays.

Look at the following display for InterContinental — The Barclay hotel in Manhattan and notice that Kayak displays no price comparisons — other than a generic $237 price — or booking options in the initial display.

From here, the consumer is still two steps away from beginning the process of booking The Barclay. The consumer has to click on the details link to view the following options on Kayak.com. (Incidentally, only Booking.com comes close to the $237 base room price that Kayak listed on the previous screen.)

Here, consumers finally can view room pricing from the various booking websites — except for Expedia’s. Kayak doesn’t display Expedia’s rates, and if consumers want to view them, they’ll have to select “click to see rates” and navigate to Expedia.com.

Kayak’s stated mantra is to making the user experience as easy as possible, but by allowing Expedia to display “click to see rates” instead of The Barclay’s room rate, Kayak and Expedia are making the consumer experience clunkier.

On a side note, one positive aspect of the above Kayak display is that it enables Orbitz to list its phone number for consumers who’d rather call then click on the website link. That’s great for consumer choice and for Orbitz’s merchandising efforts.

Online travel agencies like Hotwire and Expedia.com aren’t the only source websites which are throwing their weight around in metasearch.

Several airlines have followed American Airlines’ lead and are refusing to display their fares in metasearch results alongside the ticket prices of other airlines.

Both trends — OTAs refusing to disclose ticket prices or hotel room rates, as well as airlines refusing to submit their fares for side-by-side comparisons — are making the complex trip-planning process even more complex for consumers.

Categorisation of online travel sites used to be easy. Either a site was transactional or non-transactional.

Either it made its money negotiating with suppliers for inventory and charging customer credit cards or it made its money from advertising and clicks through funnelling consumers from one place to the other.

In a post Meta-search vs Online Travel Agents: The Three Main Differences and Why They Matter, I mentioned that one of the major differences between an OTA (transaction site) and a meta-search site (non-transaction site) is that the transactional sites try to build up a unique product set – inventory (or inventory combinations) that no one else has – whereas the non-transactional meta-search company is focused on pointing to product that by definition is not unique as it is maintained by someone else.

A clear distinction that made it easier for customers and companies within the industry to know who was doing what and (in the case of companies) how to operate together.

However in late-2009 the distinction between the two categories began falling apart with non-transactional sites building unique product offerings.

Here are six theoretically non-transactional sites now operating unique product models.

Kayak Private Sale

• Dennis Schaal has been tracking the ins and outs of the launch of Kayak Private Sale – efforts by the US’s number one metasearch company Kayak to launch exclusively negotiated deals. My own thoughts on the program are here: Zero  Percenter No More.

TripAdvisor

• In November 2009, TripAdvisor announced the launch of TripAdvisor Busness Listings. Under this model TA will charge properties $600 or more to add direct to property contact details (email, URL, phone) with the aim of driving direct to property sales rather and sales through third party advertisers. TripAdvisor have not said it yet but I think it is only a matter of time before they start carrying rates and specials.

Voyageprive and Jetsetter

• Hotel Blogs recently let me know about a French company VoyagePrive. Now operating in a number of countries, VP is a referral only travel “club” that points members in the direction of deals only available on VP. To get into the club you have to be invited by a member. Then VP will send out to the members deals that have be privately sourced from suppliers. Deals open for only 72 hours.
• Jetsetter is a similar model. Created by former Kayak VP Drew Patterson, Jetsetter has also taken the referral-only club with limited time period deal approach. More about in previous Tnooz articles.

DealBase

• I first came across DealBase at the PhoCusWright Travel Innovator Summit in 2008 (Dealbase and demo presentation) and was one of my picks for the top six at that conference. Hotels directly load deals onto DealBase which are in turn then checked by the DealBase team for quality of the deal. The deals are coming from the supplier but the checking is being done by the distributor which DealBase hope will result in unique product.

TotalTravel

• Australian based TotalTravel (now owned by Yahoo7 – a JV in Australia between Yahoo! and a TV network) started as an accommodation listing site (using the TripAdvisor Business Listing model years before TA launched it). Hotels in targeted destinations would get a base listing for free with paid upgrades for placement and promotion. Those enhanced placement options include the ability to promote specific (and at times unique) deals to the TotalTravel system.

The blurring of the clear distinction between the companies that sell and that companies that help the companies that sell has important consequences for the industry.

As previously mentioned, the OTAs have built up their unique product capabilities behind an expensive infrastructure of supplier management, merchandising and customer care teams.

The non-transactions sites are trying to replicate the unique product set without the costs. I don’t think they can replicate the same deal potential without the cost.

Finding a good deal is hard (time consuming and costly). Targeting it at the right consumers is even harder (more time, a little less costly).

If they can – and I doubt it – then it will push the OTAs to also rethink their models and costs – causing a true industry revolution.

Oxford, UK-based meta site Zoombu is almost ready to reveal all to the wider world with the launch of an overhauled micro-version of the main site for skiiers.

Under wraps for over a year – during which time it has still managed to win plenty of plaudits and a round of funding – Zoombu will unveil a slimmed down version of the main site next week to target the late-ski market in Europe.

The main Zoombu site, which features the same design treatments as those applied to the ski edition, is scheduled to be unveiled at a later date, although data and feedback from those using the ski site effectively as a testbed will be incorporated into the wider development work.

The ski site allows users to look for travel options between the UK and the French Alps using different modes of transport and using point-to-point search, rather than departure and destination airports.

Results are filtered using quickest, cheapest and greenest options.

Google Maps are also included to show where on the user’s journey their modes of transport will change.

Co-founder Rachel Armitage says:

“It’s a very small part of our overall coverage, but we have decided to open this up so that users can easily try it out and provide valuable feedback on the functionality, which will be reflected in the main product.”

Another UK-based web startup, Snowcarbon, launched in October 2009 to provide information and deals for skiiers heading to the Alps by rail.