So here’s a graphic demonstration of dangerously concentrated power has become in the online travel world.
One company, Priceline Group, announces that its brands will advertise through the Instant Booking app on TripAdvisor.
This seemingly modest news – an advertising agreement – turned out to be seismic and instantly sent TripAdvisor’s share price up 22.4% while Priceline Group rival Expedia’s shares fell -3.8%.
Wow. Small world.
Between them Priceline (Booking.com, Priceline.com, Agoda.com, Kayak etc) and Expedia (Expedia, Hotels.com, Trivago, Wotif, Orbitz etc) dominate online travel.
They effectively own all the major online travel brands.
Except one: TripAdvisor.
It used to be owned by Expedia but was spun off into a separate listed company in 2011.
Since then it has expanded way beyond its review base and is now first and foremost a hotel search meta-search site with millions of reviews on hotels, restaurants and attractions.
Financially, TripAdvisor has been under-performing with a rapidly expanding cost base.
Instant Booking, which allows consumers to book direct on the TA sites with advertisers such as Booking.com or hotels, is the product it believes can turn things around.
And based on the initial reaction to the Priceline Group deal, they are probably right.
The rub is that Expedia doesn’t use Instant Booking and has said rather forcefully that it has no intention of doing so, hence the share price decline.
But is it really that big a deal?