MakeMyTrip’s Myra assistant now handles over 50,000 conversations a day, and more than 45% of the queries come from Tier-2 and smaller cities, according to MakeMyTrip said in February. The company announced on 18 February 2026 that OpenAI’s APIs had been integrated into the assistant.

On 30 September, Group CTO Sanjay Mohan took the stage at Inc42’s CTO Summit 2026 for a session titled ‘What Lakhs Of AI Conversations Are Teaching MakeMyTrip About How India Travels’. Inc42 reported his remarks. Five moves stand out, and each one carries a lesson for any travel business that sells in India.

1. One conversation replaces a sequence of steps

Mohan said users now combine flight preferences, visa requirements and payment offers in a single conversation. Those used to be separate steps, each on its own screen and in a fixed order.

Each hop between screens is a point where a traveller can drop out. For airlines, fare rules, visa documents and card offers belong in one answer. For hotels, the same logic covers room type, cancellation terms and the payment offer that applies. An OTA that keeps those answers apart is asking customers to do the stitching themselves.

2. Voice booking for users who find typing a barrier

Mohan said voice use is significant in Tier III and IV regions, where typing is a barrier. Myra 2.0, launched in May 2026, added voice booking in eight languages.

Most booking funnels assume a keyboard and comfortable written English. Voice reaches the customers those funnels quietly lose. Any airline, hotel chain or OTA selling to smaller cities faces the same gap, and speaking is a lower hurdle than typing a search.

3. Eight languages from the start

Myra works in Bengali, Hindi, Kannada, Malayalam, Marathi, Tamil, Telugu and English. The list fits the audience: more than 45% of queries arrive from Tier-2 and smaller cities.

Language coverage is a demand decision rather than a courtesy. A hotel group in Kerala or an airline flying out of Chennai receives questions in Malayalam and Tamil, and an assistant that replies in those languages keeps the booking inside the chat. MakeMyTrip cites over 87 million lifetime transacted users, so the audience it is serving is wide.

4. Complete bookings inside the chat

Myra 2.0 handles a complete booking in one chat, with integrated payments and passport OCR upload. The traveller does not need to leave the conversation to pay or to submit travel documents.

An assistant that only recommends sends the customer elsewhere to finish. One that takes payment and reads a passport upload closes the sale itself. On international routes, where document checks slow the process, that is where the time is saved, and where an airline or OTA stands to lose the fewest customers.

5. MakeMyTrip and OpenAI: meeting travellers where discovery starts

Rajesh Magow, Co-founder and Group CEO, said the OpenAI collaboration means that when a traveller begins a journey through conversation, MakeMyTrip carries on naturally from that discovery.

The OpenAI integration places MakeMyTrip inside the chats where trips now begin, rather than waiting for a customer to open its app. For hotels and airlines, the point is plain: if a traveller starts planning in a conversation, the brand that is present in that conversation gets the first look.

Key takeaway

The one thing to copy is the scope, not the technology: one assistant that carries a traveller from question to payment, in the language and the mode they use. Start with the step where customers drop out today, whether that is visa questions, offers or document upload, and put that step inside the conversation first.

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MakeMyTrip has launched Price Drop Protection on flight bookings, an add-on that pays travellers back if the fare falls after they book, BW Travel reported on 28 September 2026. It costs Rs 229 per person on domestic flights and Rs 349 per person on international flights, on one-way and round-trip bookings.

The launch shows India’s largest OTA changing what it sells. The ticket is now only part of the purchase. Around it sits a growing set of paid add-ons, each one covering a risk the traveller once carried alone after payment went through: a trip called off, a flight moved and, from this week, a fare that drops.

Price Drop Protection: from selling seats to selling certainty

MakeMyTrip’s protection add-ons already covered cancellation and schedule changes. Price Drop Protection extends them to fare moves after booking. Each risk now carries its own price at checkout, and each price is ancillary revenue for the platform rather than for the airline.

Before this, a cheaper fare after payment was simply money lost. A buyer who expected prices to fall had one option: hold off and hope the fare did not climb instead. That gamble now has a fixed cost, starting at Rs 229 a head, and the reason to wait goes away.

“Travellers should not have to choose between booking early and worrying that fares may fall later. Price Drop Protection lets them book when it works for them, with the reassurance that if the fare drops, they are protected,” said Raj Rishi Singh, COO of Flights, Corporate, GCC and Marketing at MakeMyTrip.

How the cover pays out

The refund has a ceiling, set out in MakeMyTrip’s terms and conditions. A domestic one-way passenger gets the fare difference or Rs 2,500, whichever is lower. The limit is Rs 5,000 on a domestic round trip, Rs 3,000 on an international one-way and Rs 6,000 on an international round trip.

Cover runs from booking until 6 hours before the scheduled departure. Fare changes in those final 6 hours do not count. MakeMyTrip alerts the traveller when a drop occurs. A claim can be lodged on the platform only after the trip is flown, and within 30 days of the scheduled departure date. The refund goes back to the original payment method.

MakeMyTrip (India) Private Limited provides the protection. Across Assist Private Limited provides assistance services but not the protection itself.

What does not count as a drop

The terms rule out several kinds of cheaper fare. Flash sales and promotional offers do not count. Neither do coupon codes, cashback, loyalty or reward fares, non-public fares or system errors. A lower fare caused by a cut in government taxes, airport charges or regulatory fees is excluded too.

Any change to the trip voids the cover: a rescheduled or cancelled flight, or an amended booking, including a new date. Charter and non-scheduled flights cannot be protected.

BW Travel says the feature is “currently, in a testing phase” and that “among those who opted for it, a large number of people saw a price drop on both domestic and international flights”. It gives no figure. Moneycontrol also reported the launch on 28 September.

Who it hits

Airline revenue managers feel it first. A buyer holding the cover has less reason to sit on the fence, so demand that once waited for a cheaper seat can book earlier. Airline flash sales and promotional fares fall outside the cover, so they still pull buyers on the airline’s own terms.

Rival Indian OTAs, among them ixigo, Cleartrip and EaseMyTrip, now face a competitor that earns a fee from fare movement itself. The contest at checkout shifts from who shows the lowest fare to who takes the most risk off the buyer, and how many protection products a traveller will pay for on a single ticket.

For OTAs and airlines elsewhere in APAC, the terms read as a ready template: a flat fee per person, a cap by route type, a cut-off 6 hours before departure and claims only after travel. Hotels and DMCs that package Indian flights should note that the cover applies to the flight alone.

MakeMyTrip Group CEO Rajesh Magow takes the WiT Singapore main stage on 1 October, from 10:10 to 10:30, in a session titled “Building for the Next Billion: The India Story”.

Key takeaway

OTAs with a large flight business should test a fare-protection add-on now, and MakeMyTrip’s terms already show where to draw the lines: no promotions, a cut-off before departure and claims after travel. Airline revenue teams in India should ask OTA partners whether early bookings rise on routes where the cover sells. Hotels and DMCs can wait, because the cover changes when a flight is bought, not what the traveller spends on arrival. We will be watching whether Rajesh Magow takes the add-on story further in Singapore.

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ixigo Smart Lock launched on 17 September 2026, an agentic AI feature that watches eligible flight fares 24×7 in the background against a traveller’s target budget, for a fee starting at Rs 99.

The traveller enters a destination, dates and a budget. When the agent finds a fare inside that budget it locks the price for four hours and sends a notification. The feature is limited to domestic one-way flights in India for now. If no fare turns up inside the budget, the full fee is credited to the traveller’s ixigo money account, redeemable on future flight, hotel and bus bookings. “With Smart Lock, we are shifting that effort from the traveller to AI agents. Users can simply tell us where they want to go, when they want to travel and how much they are comfortable spending,” said Rajnish Kumar, co-founder and group co-CEO.

Every OTA and airline is piloting agentic AI travel booking this year. Most are starting with the agent. ixigo started with the pieces underneath it. Here are the five things it did that others did not.

1. It sold the habit first, at Rs 149

Smart Lock is the second paid price product on the app, not the first. ixigo’s Price Lock starts at Rs 149, holds a fare for anywhere from four hours to 14 days, absorbs fare increases up to Rs 4,000 per traveller on domestic routes and Rs 8,000 on international, and passes on any drop in price. The Price Lock terms are plain: it is “a price guarantee and not a seat guarantee”. It works per traveller, needs a logged-in user, asks for no passenger names until the final booking, and refunds the fee if seats sell out before the booking is completed. A customer who has paid Rs 149 to hold a fare already understands what an agent that finds and holds one is selling.

2. It priced Smart Lock below the habit, at Rs 99

Smart Lock starts at Rs 99, Rs 50 under Price Lock, and it does less: a four-hour hold rather than up to 14 days, on domestic one-way flights only. The narrow scope is the point. The agent watches a small, well-understood pool of fares, the promise fits in one sentence, and the price sits below the product the customer already knows. Operators who launch an agent at a premium, with a wide remit, are asking the customer to pay more for something less proven.

3. It made failure refundable, into ixigo money

If the agent cannot find a flight inside the budget, the full fee comes back as ixigo money, which the traveller can spend on flights, hotels and buses on the app. Price Lock set the pattern: the fee is refunded if seats sell out before booking. The agent inherits a promise the customer has already seen honoured, and the refund stays inside the app rather than going back to a card. A failed search becomes a credit toward the next booking.

4. It built the funnel on trains and buses, with a 63% share

ixigo holds a 63% OTA market share in trains. Bus GTV grew 39% year on year in Q1 FY27. Hotels delivered 0.5 million heads on beds in the quarter after a 54.66% majority stake in Brevistay and 10,000 plus direct property contracts across 700 towns, according to the company’s Q1 FY27 release. The flight agent does not have to buy its audience. It sits in an app that travellers open for a train or a bus, and the ixigo money refund routes a failed flight search back into those same categories.

5. It shipped from a book that made money, PAT up 81%

Q1 FY27 gross transaction value was Rs 5,524.33 crore, up 19%. Revenue from operations was Rs 356.75 crore, up 13%. Profit after tax was Rs 34.24 crore, up 81%, and EBITDA was Rs 53.52 crore, up 65%, with adjusted EBITDA at Rs 29.24 crore. A Rs 99 agent that refunds itself when it fails is a small bet for a company at those numbers. The agent is an add-on to a business that already works, not the plan to make one work.

Key takeaway

The one thing to copy is the order. ixigo sold a paid, refundable, manual version of the promise for years before it let software make the promise on the traveller’s behalf, and then priced the agent below it. Any hotel, airline or OTA with a booking funnel can do the same: put a price on the hold, make failure refundable in your own currency, then automate the search. We expect the operators that start with the agent instead to spend the next year teaching customers what it is for.

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Technology continues to innovate how travellers are preparing for and enjoying their journeys, or how hotels are adapting to their guests’ changing preferences. So far, there has been much hype around travel disruptors such as Airbnb and Uber. However, the continual foray of tech giants into the travel space is what should be grabbing our attention right now.

Competition is actually coming in now from big technology players. The huge growth potential in the online travel space, particularly in Asia-Pacific, is attracting their attention.

Take the case of Google and Alibaba, who are already very much in the travel space. Combine the search engine giant’s complex algorithm with its products like Google Flights, Google Hotel Finder and Google Trips, and you will see how the company is slowly and steadily climbing up the trip-planning funnel. In the $2.3 trillion contributed to the global economy by travel and tourism, Google already has a large share of the pie. The company has been developing travel tools in the last four years, and is even starting to make them official. For instance, Google Flights came out way back in 2011, but they re-designed and launched the tool only in 2015, replete with exciting new features. The company has now made it easier for users to check out important hotel details such as rates, locations and reviews. Google users can also book some hotels directly while searching for particular properties. Moreover, when a user types in a query for a particular destination, Google also displays a list at the top of the page that provides travellers information about popular sightseeing locations.

Image source: Gravity Flow

Alibaba’s Fliggy is not far behind. The company recently announced a joint venture partnership with Marriott International to redefine the travel experience for the hundreds of millions of Chinese consumers traveling abroad and domestically every year. The joint venture will leverage Marriott International’s global portfolio of brands and unparalleled hospitality expertise to revolutionize the travel experience as well as Alibaba’s digital retail leadership and its role as a gateway for international brands to reach over 500 million mobile monthly active users across its platforms. Drawing on resources from both Marriott and Alibaba, the joint venture will manage Marriott’s storefront on Fliggy, Alibaba’s travel service platform. It will also market directly to Alibaba’s customer base, provide a link between Marriott’s loyalty programs and Alibaba’s loyalty program, and support Marriott hotels globally with content, programs and promotions customized for the Chinese traveller.

We can also see non-traditional travel actors in payments space or general online retailing, like the Amazons of the world, developing the travel component. Closer home, Paytm is an example. On the back of raising $1.4 billion from SoftBank, Paytm is making aggressive moves to challenge existing players in verticals like travel and hotels with the help of deep discounts.

And we will keep seeing many others in the space, too. Travel is a very interesting space for many of them as it is accessible for anyone who has online retailing experience. There is definitely a good basis to build a travel marketplace then. Moreover, considering that companies like Apple and Google already own 90 per cent of the mobile ecosystem, it allows these tech giants to easily capture travel data and get insights on what they’re looking for. Plus, the tech companies are heavily leveraging machine learning and artificial intelligence to draw insights from that data in real time to create optimized results.

Calling attention to the areas that are broken in the current systems is precisely what tech companies are now doing. This, however, does not spell doom for the traditional players. In fact, with tech giants attacking weaknesses, it gives the industry an opportunity to wake up and think about change, thus making them more open to the adoption of new technology. And that is always going to be a win-win for everyone.

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London Stock Exchange-listed tourism company TUI has set its sight on the fast expanding Indian online travel market. It recently shut its business of distributing holiday packages and launched an online platform in early May for hotel and flight bookings and to compete with players such as MakeMyTrip and Yatra.

Having identified India, China and Brazil as future markets to gain significant share in the growing online travel bookings space, TUI Group has devised the ‘TUI 2022’ strategy. As part of this exercise, the Group’s subsidiary TUI India has been transformed to a digital provider exclusively focusing on the online business. Its website www.tui.in now allows Indian consumers to combine flight and hotel offerings within seconds. The change in approach is underpinned by the appointment of Krishan Singh as CEO of TUI India. Krishan joins TUI India from Yatra.com where he served as Senior Vice President.

With its TUI 2022 programme, the Group will achieve a fully digital market entry based on standardised, globally scalable and uniform software architecture in India, China and Brazil. By 2022, TUI Group aims to win additional turnover of EUR 1 billion and 1 million additional customers from these future markets.

TUI launched its classical tour operating business in India in 2005. The business has now been realigned to reflect India’s rapidly expanding Internet usage and significant growth of online travel bookings. In 2017 alone, revenue in the online travel booking market in India climbed by more than 30% year-on-year to USD 22.5 billion.

Alexander Linden, Director Future Markets, TUI Group, “India is one of our future markets to deliver additional growth for the TUI Group. Realigning the local business with a strong digital focus under our TUI brand offers enormous opportunities. I am happy to have Krishan and his team onboard, they will ensure business expansion and deliver future growth.”

The Indian online travel market has been seeing a rapid growth led by steep discounts and offers from market leaders such as MakeMyTrip and Yatra. While nobody else is making much money in the space, TUI is clear that it wants to have a sustainable and profitable Indian journey.

Besides selling hotels and flights, TUI will also focus on growing the flights-plus-hotels segment to short-haul destinations such as Singapore, Dubai and Mauritius.

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Hotel Technology is one of the fastest growing segments in the hospitality industry. The development of affordable applications that make advanced technology accessible at scale, rather than it being the prerogative of luxury hotels is another important development. Aiding this change is AxisRooms, a technology-based channel management system that helps hoteliers improve their distribution, both for online and offline channels. Whether it is getting adequate exposure for the property or allocating the correct price for rooms in time, AxisRooms’s single dashboard gives hoteliers a seamless experience in inventory management.

Using this, hotels have a better visibility of the demand and are able to serve guests better. Currently, it has 6500+ hotels on its platform spread across 20+ countries including brands like CGH Earth, Leisure Hotels, OYO Rooms, FabHotels, Keys Hotels, Park Regis, ITC WelcomeHeritage, and more. It is backed by Seedfund, India’s leading early-stage venture capital fund.

Here are some excerpts of an interaction with Anil Kumar Prasanna, Co-founder & CEO, AxisRooms.

1.Can you tell me something about the history of company?

We started out in 2011, February. We understood the complexity behind the whole inventory allocation system, which is mostly like a quota-kind of system; not good for business in the long term. So, we thought why not build a platform like this that would overcome the difficulty of managing inventory, provide real-time availability, dynamic pricing, and help hotels optimize revenue management. We wanted to change the way the hotels are working currently.

2. How many people started this and how big is the team now?

We started with three people and now we’re more than 50 people in the organization.

3. What is driving this market – channel and revenue management, and hotel property management?

Our success has been the channel management system and the revenue management system. You do have a couple of other platforms of course, but most preferable-to-use platforms are these two.

4. How often do you feel the need to upgrade or innovate technology and how do you do it?

It’s constant. We need to keep working on new things. We have to keep innovating because you know things are changing, technologies are changing, competitors are changing their technologies. Today, our training management systems help hotels in so many ways. For instance, I can probably handle 300 different types of customers, but my hotels can’t handle, so I have to make a training system for that, and we have to constantly update our platforms. We need more and more data to achieve this and new algorithms might be a factor for everything.

5. Do independent hotel also come to you?

My biggest customer base, is in fact, independent hotels across India. We also work for chains across Sri Lanka, Dubai, Thailand. We also have big partners in Sri Lanka and Bhutan.

6. What according to you are the best practices to manage hotel distribution channels?

I think the simple thing that a lot of people don’t do, especially from the Indian market perspective, is that they don’t open their inventory fully. And second thing is they are very short on plans. They don’t plan ahead. If you look at international markets, they plan for the coming year also, so there is no pressure later. These are the basic things that a lot of hotels should keep in mind. Holding back inventory impacts the business.

7. Why do you think that happens?

In India, October to March is peak season, and then monsoon is considered off season. However, dynamics have changed. Airlines take you everywhere, there are so many airports, the way people travel has changed. But old-school hotel managers are not changing the way they work.

8. Do you sort of counsel these hotels who work on an old legacy system?

Very much. Today in fact systems are so fragmented. Large partners, like 5-star hotels are also fragmented. They do have multiple systems, but they do not work in an integrated way. The systems are broken.

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TourRadar, the online travel agency (OTA) that targets the multi-day touring market, has raised $50 million in Series C funding. The Vienna, Austria-headquartered company, which also has offices in Brisbane and Toronto, was founded in 2009.

Consisting mostly of primary funding, the round is led by the Silicon Valley growth VC firm TCV, with participation from existing investors Cherry Ventures, Endeit Capital, Hoxton Ventures, and Speedinvest. TCV has previously backed Expedia and Airbnb, and has a decent track record in the travel space.

Erik Blachford, a venture partner at TCV and already an angel investor in TourRadar, has joined the company’s supervisory board. Blachford was previously President and CEO of IAC Travel, managing all of IAC’s travel assets including Expedia and Hotels.com.

More than 600 operators, such as G Adventures, Contiki, Collette, Intrepid Travel, Topdeck Travel, Trafalgar, and Uniworld, sell more than 25,000 tours via TourRadar. The company intends to hire employees and invest in its technology.

Last year in October, the company had secured $10 million in Series B, which it had used to double its headcount, mainly in its tech and product department across all offices in Vienna, Brisbane and Toronto.

TourRadar was one of the first online marketplace for the touring industry and aims to offer travellers the easiest way of booking multi-day tours at the click of a button. The company believes the addressable market for multiday tours is about $55 billion worldwide.

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Blockchain is emerging as a strong technology tool that is all set to change the status quo of the travel industry. This is largely because it has the potential to dramatically alter the way in which information or data is stored and used, enhancing transparency and security, while also improving transactions. One of the most crucial aspects of blockchain technology is that data is decentralised, with information shared across a peer-to-peer network.

Banking on its subsequent adoption and tremendous growth potential, Singapore-based GOeureka is planning to launch their online hotel booking platform at the end of 2018, which will be utilising blockchain technology to deliver an industry-first solution that will disrupt the current OTA business model.

This next-gen solution that will shape the future of online booking, will be built on top of the Ethereum platform, an open software platform based on blockchain technology that enables developers to build and deploy decentralized applications. GOeureka will challenge the status quo by removing hefty OTA commissions paid by hotels.

Image source: GOeureka

The booking engine will also allow users to earn cryptocurrency tokens (Go Tokens issued by GOeureka) for online bookings made on the platform which can then be used for future bookings on the portal. The company’s goal is to deliver greater transparency in the booking process and drive better value for the consumer by allowing users to transact directly with hotels through smart contracts. GOeureka will eradicate the current commission model adopted by online travel agents and work on a much more cost-effective fixed-fee model with their hotel partners. This will decrease the costs that hotels incur when a booking is made through a third party booking engine.

By reducing the financial commitments of hotels to third-party booking platforms, the company’s vision is to enable hotels to focus more resources on providing better intrinsic value and services to travellers around the globe. Other features the company plans to release is to facilitate interoperability of hotel loyalty points and a rebooking system that will deliver the best possible room rate for travellers.

“Think of GO Tokens as loyalty points which users can utilise to unlock a range of benefits across our platform. One of the distinctions between our tokens and traditional loyalty points is that GO Tokens will also have monetary value as they can be traded on crytopcurrency exchanges. Having said that, the intrinsic value of our tokens is its utility across our platform” said Manraj Rai, GOeureka’s founder and CEO. GOeureka also plans to enable booking payments through traditional methods such as credit cards and other forms of cryptocurrency.

GOeureka has already launched its GO token sales, after which it plans to launch product Beta test with its partner hotels. This will be followed by the launch of the platform, and a digital marketing campaign by the end of this year. The company has already received a successful seed funding for the purpose, and currently has a 19-member strong team spread across Singapore and Malaysia.

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More than 300 million registered users who book trips through online travel agency Ctrip will now have more personalized options and service from AccorHotels as well. The Paris-based global hotel chain and Shanghai-based online travel platform have recently signed a memorandum of understanding to enhance their existing partnership.

The agreement has four components: more prominent promotion of AccorHotels on Ctrip, building a flagship store for AccorHotels, joint development of loyalty programs and cooperation on technology.

Commenting on the partnership, Jane Sun, CEO of Ctrip, said, “With the ever-growing number of outbound Chinese travelers, we are always looking for ways to provide better services for our customers, and with the deepened AccorHotels relationship, we are able to offer magnified experiences and property choices. With the diverse range of hotels offered by AccorHotels, Ctrip customers will have access to a vast majority of its hotels globally.”

AccorHotels’ portfolio currently offers 4,300 hotels and 10,000 private homes in 100 countries, ranging from luxury brands to mid-scale and budget properties.

Chinese outbound tourists have long been a high-priority group for many luxury brands, but the demands and habits of younger travellers are changing rapidly, as they seek out more digitally personalized experiences, including superior guest services and smart device integration.

Image source: Luxuo

A report titled ‘Chinese Luxury Traveler 2016’ states that the continued growth of China over the next several years will ensure that its consumers remain prime targets for brands for the foreseeable future, as even a slowed China exceeds the growth rate of western nations. As a result, travel brands will need to make a connection to this group, the first born in a fully modern China, in the interest of long-term success.

According to the report, personalized service is still the biggest consideration in travelling for luxury Chinese travellers. Besides a liking for amenities, being able to choose pillows of different firmness and having a butler or personalized service through digital channels are also important. While 73 percent demand WiFi, 55 percent want smart TVs, while unique art and design are also high draws. AccorHotels, with its CRS, mobile app, loyalty programs and products like Adobe that it uses to personalize the guest experience with targeted offers and other information, is best suited for this crop of Chinese travellers.

Additionally, China’s travellers, especially the young ones, get most of their travel information digitally, largely from official WeChat accounts. Ctrip, Qunar and Tuniu are popular third-party platforms in the country, making this MoU worth the while for AccorHotels that is aiming to position itself on the Ctrip website and in the Chinese travel market.

AccorHotels will also launch its own program to train and certify at least 250 hotels by 2020 on Chinese Optimum Standards. These properties will be trained to answer major Chinese guests’ expectations. Ctrip says it may invite additional partners to be featured on its platforms as it pursues its goal to provide members with “dedicated experiences and better services to become a one-stop travel shop.”

Chinese residents will make 90 million outbound trips in 2020, with that number increasing by an additional 36 million over the following decade, according to a report by Euromonitor, making them one of the most lucrative audiences for travel providers across the world. By tapping into personalization such as mobility, language customizations and other services, many other brands like AccorHotels can create differentiated experiences that will eventually help enrich services and gain valuable customer insights in the process.

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Not long ago, the two segments within the hospitality industry – OTAs and hotels – maintained a friendly relationship. Their cooperation benefited everyone, including them; hotels gave online travel agencies their long-standing business to market to, and OTAs returned the favour by providing hotels the visibility that would improve their bookings.

That relationship has slowly soured, as OTAs have gradually widened their market share and raised commissions, undercutting hotel companies’ bottom lines. In a recent case involving Westgate Resorts and Swiss website Amoma.com, the former has accused the latter of selling Westgate rooms for unauthorized wholesale rates, taking the matter to federal court. According to Westgate, Amoma was securing its wholesale rates from travel site operators and then offering these low rates directly to consumers with only small markups, which was undermining Westgate’s established business model.

This is definitely not the first case to have put the spotlight on the frosty relationship between hotels and OTAs. Last year, Hyatt and Expedia were at loggerheads over crafting a new agreement on commissions and other issues. Like many of its peers, Hyatt also wanted to negotiate lower commission rates from Expedia.

Online travel agencies came into the picture in the 1980s and gained more momentum in the next decade. Today, reports predict that the Priceline group (which includes Booking.com) and Expedia alone will account for 94% of all online bookings by 2020. While so far, hotels have been happy to take increased visibility, but on the flip side it has meant less money for them, with a sizeable chunk of their revenue stream now going to OTAs. As hotel companies are growing their technology capabilities, major players are questioning the need for OTAs when they now have the capacity to get customers directly. Hotels are trying to better capture the guest through improved user experience, user-driven design, and an emphasis on making booking as easy as possible. For instance, hospitality giant Hilton introduced a global advertising campaign ‘Stop Clicking Around’, complete with broadcast and digital spots that encouraged consumers to book directly through Hilton rather than waste time on third-party sites.

Commenting on these efforts by hotels, Sanjiv Agarwal, Chairman & CEO, Fairfest Media, said, “Rate parity and MFN led to imperfections in the market. Hotels have rightly fought against these practices. The whole point of the hotels seemed to be that they should be able to compete in a free market by showing prices lower than the big OTAs. Now by the same logic, a hotel should not mind an OTA offering lower price to consumers. Hotels would also do well to keep in mind ‘direct’ business does not come free.”

The hotel lobby has long been asserting that OTAs are practising a sort of monopoly. This, however, is not possible, because travellers have many options, online and off, besides Expedia and Priceline. Besides, OTAs don’t set the retail prices; it is the hotels that set pricing, based on multiple factors. OTAs only set commission and contracting terms.

The reason that the skew towards OTAs remains is due to the fact that travellers associate cheaper costs with them. Hotels have limited control of their operational costs, have less inventory than OTAs and invest significantly less in marketing initiatives, which leads to consumers being exposed more to OTAs.

So, how will all of this ultimately play out? Considering all the efforts that hotels are putting towards increasing direct booking, it will grow. That, however, will not prove detrimental to OTAs, as independent and boutique properties will continue to benefit from their offerings. The question that will ultimately beg an answer is how the short-term attempts by hotels to divert business from OTAs will convert into bringing long-term, brand loyalists on board.

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