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A New World
Cheap Charlie · November 17, 1999

I just returned from a major conference with the top dogs of the Internet travel industry. Everyone who was anyone in the Web travel world was there -- Expedia, Priceline, 1travel, Travelocity, Preview Travel, SkyMall, TravelScape and more.

It was interesting and educational as well. The good news is that the Internet travel world is growing rapidly, more rapidly than any of us imagined. Plus, many of the bigger sites are beginning to form alliances and consolidate.

And competition for travelers who plan their travels on the Internet is fierce -- very fierce.

This competition will translate into lower prices for travelers using the Web for planning and booking vacations anywhere in the world. Tour packages and cruise line bookings are lagging airline reservation capabilities and car rental arrangements, but change is coming to every part of the industry.

One speaker asked for a show of hands of participants who were planning to raise investment capital in the next year. About 150 hands went up.

This speaker then asked, "How many of you are planning something new, where you will be first to market?" This time only about five hand remained up.

This means that the current systems for hotel, airline, automobile and tour packages will continue to be improved. With literally hundreds of new sited coming online, the sites already in operation will have to stay on their toes. Plus, the mainstays will learn valuable technology lessons from the newcomers.

Airline fares are already being influenced dramatically by Internet sites such as Priceline.com and 1travel.com. Each is taking a different tack when it comes to giving consumers a better deal. Consumers are winning twice.

Priceline.com has taken the approach of a form of auction where the user quotes a price he or she is willing to pay for transportation between two towns. If an airline agrees to their price, the ticket will be issued. Once you bid and the airline accepts, you own that airline seat.

The number of different airlines working with Priceline.com is continuing to expand. As that group expands, the number of bids that can be accepted will also increase.

1travel.com takes another approach. It has initiated a new "white label" sale that will be online in the next couple of weeks as well as a straight auction that is currently in operation. The White Label fares will provide simply point-to-point airfares (with up to one stopover) with no guarantee of airline and with times set within general guidelines.

For instance the customer will be able to say that he or she wants to travel in the morning between Boston and San Francisco. They will be given a price that they can either reject of accept. The prices will be significantly reduced since they will not interfere with airline yield management.

It will be a new world.

1travel.com also launched an auction site last week that offers trips throughout the world through a bidding process. All bids start at $1.00 and have a specific date that ticket flight and package bids must end. This is a section of the site that should be lots of fun to explore and you may find a bargain or two.

This is only the beginning. A new world for pricing and travel opportunities many of us never considered will be opening as the online travel market grows, old sites learn new tricks and new entrants bring different ways of doing business to the market.

Enjoy. I'll be reporting on the new sites as I have a chance to explore them.

Charlie Leocha is the Boston-based author of Travel Rights: Know the Rules of the Road and the Air Before You Go. Cheap Charlie appears every Monday on this site. E-mail him at charlie@ticked.com or access his Web site.