Why do online travel agencies restrict their sites?

If you’ve ever lived abroad for a while, you might have stumbled across a price discrepancy for which there seems to be no valid reason. Airline ticket prices on certain routes are lower than they are if they’re purchased here — but try to buy one, and you’re out of luck.

Sharon Peterson wondered about that. Specifically, she questioned price differences on air fares between the US version of Expedia and its UK edition. Intra-European tickets, she notes, are far cheaper on Expedia UK than on its American counterpart. What’s with that?

“Why does an American have to pay more for the same travel between countries over here than a British person or a French person?” she wonders. “And when I’m in the UK, why does Expedia have to threaten me that I have to use the UK Web site every time I sign on to my computer?”

Good question.

I asked Expedia spokeswoman Katie Deines to answer. Here’s what she said:

There are a number of factors that could result in travel pricing variances between geographies. These could include currency conversion, airline capacity, and the dynamic nature of travel pricing in general.

It might be similar to what you’d find if you searched for different products on multiple Amazon sites, or to the difference in the price of a shirt you buy at the Gap in New York vs. the Gap in Tokyo.

Before I go further, it’s important to note that Expedia does not set airfares – the airlines do, and would probably be a better source for explanation of the dynamics that influence pricing across international geographies.

That said, different airfares have different terms and restrictions. For example, a fare sold in the UK might have a specific stipulation in the fare terms that it can only be sold in the UK. International airlines may have higher fares from points of sales outside of their home market, perhaps because outside the home market the airline’s competitive low-cost carriers are not as easily accessible.

Also, in order to make a purchase on any given point of sale, a customer would require a credit card that is tied to an address in the respective country. It’s a fairly universal fraud reduction measure for Internet retailers.

As it pertains to Expedia, each of our points of sale typically offers certain fares negotiated specifically for that market and intended by the supplier for travelers located in the local geography. We want our customers in each of the geographies we serve to have the most relevant selection and experience for them.

The general rule is that the travel selection on each Expedia point of sale is catered specifically to travelers accessing the site from that market, which is why Ms. Peterson is directed to the UK site when accessing it from a UK IP address. She should be able to access the US site just as easily, however, and if she has a credit card tied to a US address, she has the ability to book travel on Expedia.com or Expedia.co.uk according to which best fits her needs for the trip at hand.

In other words, Sharon, not only do the airlines make travel agents do it. They also place these restrictions on themselves to prevent fraudulent purchases.

Here’s my take: I think these rules are benefiting no one but the airline or travel supplier in question. If you take the potential for credit-card out of the equation, you’re left with an inescapable conclusion — that this is a money grab.

I don’t fault Expedia, or any other online agency, for this. It’s the travel companies that are responsible.

So Sharon, if you can find a way around these silly restrictions, go for it.

Christopher Elliott is the author of Scammed: How to Save Your Money and Find Better Service in a World of Schemes, Swindles, and Shady Deals. Critics have called it “eye-opening” and “inspiring” — it’ll “grab your attention and won’t let go.” Order your copy now on Amazon, Barnes & Noble or iTunes.

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