Online travel’s long, strange trip

By | March 2nd, 2001

Two cancellations didn’t kill it. Neither could a horde of furious suppliers or the flames of a thousand angry readers. As improbable as it would seem, this column – the Energizer Bunny of online travel – turns five this week.

Hard to believe, isn’t it? This feature was there at almost the very beginning, documenting the rise of Internet travel, profiling the personalities behind the sites and analyzing the industry before there were industry analysts.

And it’s a survivor. The most recent fatwah, in case you were wondering, was issued by a large online travel company that didn’t like being criticized for a string of blunders it had made before its launch. The dot-com remains in beta, but the column keeps going … and going … and going.

I will resist further rabbit metaphors. I will not liken suppliers who try to exterminate this column to Elmer Fudd’s futile pursuit of Bugs Bunny. No, I wouldn’t lower myself to doing that.

But looking back at more than 130 columns, that’s the first thing a casual reader would probably notice: how controversial these last five years have been. How, maybe, there should have been more death threats than there were. After all, online travel was born from the ashes of commission caps and it’s gone from a passing interest of second-tier travel companies to a big business dominated by large corporations.

Indeed, if interactive travel had a middle name, it would be “controversy.”

But look closer. Read a few of the archived columns and you’re likely to notice what Christopher McGinnis, another travel commentator, warned me about years ago: it’s the same story. History repeats itself in the online travel industry. There’s nothing new under the sun.

A lot of pundits who are new to this business continue to “discover” trends. They can be forgiven. It’s the ones who were there with me at the beginning who ought to know better.

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What do I mean?

– Dot-bombs are nothing new. On May 2, 1996, I wrote a column headlined What to do with a dead site? In it I mused about projects that had passed away without telling anyone. “Like flesh-eating zombies in a second-rate horror film, travel Web sites never really die. Their un-updated corpses stay preserved on the Internet as colorful monuments to their creators’ folly,” I observed. I was being facetious, of course. Even back then, there was a number of online travel ventures that had gone bust or were about to, including PC Travel and Destination Florida. The only difference between then and now is that more people are paying attention to the online travel business than before.

– A better booking engine? Right. On February 20, 1997, I chronicled FAO Travel’s efforts to build a visionary booking engine. It was one of the earliest innovators in the space, and few people noticed because it was being developed outside the United States for consumers outside of the country. If I didn’t know any better, I would think that the first truly innovative booking engine was developed by ITA Software. And that probably is because most of the industry observers’ memories don’t go back further than mid-1998, when the online travel business started catching fire. The more seasoned industry-watchers just yawn and ask: “What’s next?”

– The rules haven’t changed as much as you think. On January 8, 1998, I wrote about Preview Travel’s plans to use most of the $25 million it raised in an initial public stock offering to lure new travelers to its booking services in a new winner-take-all, America Online-style marketing offensive. “Within a year, we will dominate our competitors,” Preview president and CEO Ken Orton confidently predicted. At that time, the dot-com euphoria had just begun. Hopes were high that Preview could stand a chance against better-funded rivals and Expedia. But somewhere along the way, I think we lost our common sense. The industry thought the rules had changed to such an extent that the laws of gravity didn’t apply. Only a few months later I helped start the first stock index to track online travel companies. The index began at 100. By the beginning of 2001, it had sunk to 36.76. And Preview? It’s gone – acquired by Travelocity.

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– Are you paying attention? No, apparently everyone got so swept away in the giddy dot-com boom that my warnings fell on deaf ears. On April 22, 1999, I poked fun at the online feeding frenzy by suggesting that more suppliers should consider a Travelocity-style spinoff in order to boost their stock valuations. “AMR shouldn’t stop at taking Travelocity public; it should throw in for good measure. With the frenzy to bid up any stock that’s got a “.com” attached to it, AMR could easily get a valuation for that’s two or three times the price of the airline for which it books tickets,” I wrote. Even more surprising were the reactions I got from airline representatives when I called to ask if they’d considered such a spinoff. Only one airline – United – dismissed the question for the nonsense it was. Don’t laugh. This foolishness could repeat itself again.

– It’s all so retro. On October 4, 2000, I profiled, a company that specializes in last-minute package vacations. The venture, I noted, was “putting the finishing touches on the ‘configurator model’ project – a new application scheduled to launch in mid-November that will allow travelers to create their own customized packages. This reverse package builder is believed to be the first of its kind in the travel industry.” Expedia, of course, wasn’t far behind with its Expert Searching and Pricing (ESP) search engine, which builds package itineraries. Not to take anything away from either of these efforts, but packages are really nothing new, and what these sites are doing isn’t “stop-the-presses” news. It’s just good business. I’m surprised no one thought of it any sooner.

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– If at first you don’t succeed, recycle. On January 19, 2001, I reported on the comeback of Bruce Bishins’ agency-owned GDS, appropriately named Genesis. As he did on September 18, 1997, Bishins described an ambitious plan to introduce a new distribution system that isn’t based on proprietary technology that he says makes agents dependent on GDSs – and turns GDSs into “technology nannies.” The travel industry does have a tendency to recycle ideas, whether they’re good, bad or unworkable. The verdict is still out on Genesis, but Bishins provides a great case-in-point about the way in which we return to the same ideas over and over. Recycling isn’t just a good idea in online travel – it’s the law.

You would think that this part of the travel industry is boring, but the very opposite is true. Internet travel is a never-ending source of intrigue. During the last five years, the business has matured into a quirky offshoot of the travel industry where techies mingle with travel agents, venture capitalists work side-by-side with eccentric entrepreneurs, and suppliers get one-on-one with consumers in ways no one dreamed possible.

So what if it gets repetitive? At least it’s done in a creative way. That should be good for another five years of columns.

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