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(c) Elliott Publishing.

Cozy Relationships
Kirby's Korner · October 8, 1999

It's not often that we get to break news on Ticked.com, but I have an announcement for faithful readers. Microsoft said late this week it is spinning off Expedia.com and its related technologies as a separate company.

This follows by a week the announcement that GetThere.com, developer and current owner of the Internet Travel Network Web site and technologies, hopes to sell stock to the public.

It's not yet clear what -- if anything -- all this means to the typical traveler who prefers buying tickets online. I'll discuss the possibilities next week; bring your stock portfolio when you return. In the meantime, if you have any thoughts, I'd like to hear them.

The announcements that these ventures want to go public tie closely to the most recent major trend in online travel sales, which, in turn, brings to mind a couple of early columns in Kirby's Korner, dealing with my suspicion of airline Web sites and readers' responses to those suspicions.

The travel trade has seen a steadily growing integration of airlines and other major travel suppliers and agencies with online travel sales efforts. This could be problematic for all of us.

Advertising, cross-promotions, and sponsorships have existed online for nearly as long as companies have been selling tickets through the Web. Some of us got a good laugh out of two early online promotional efforts: Soon after Expedia started, it did a promotion with American Airlines at the same time Travelocity.com, a sister company of American, was working with Northwest Airlines, which was using a booking engine at its Web site developed by Expedia.

Beginning last year, however, we've seen travel providers take ownership interests in online agencies.

It started, hidden from public view, around 18 months ago when Delta Air Lines obtained the right to buy stock in Priceline.com in return for providing seats Priceline could sell. This information only came out when Priceline filed papers with the U.S. government in anticipation of becoming a publicly traded company.

The trend continued when, a year ago, United Air Lines bought part of Internet Travel Network (now, as indicated above, named GetThere.com). ITN got needed cash and a key customer; United got an online booking engine and other technology.

The pace has picked up in just the past couple months. United announced a partnership with online retailer Buy.com to create BuyTravel.com. Plans aren't finalized yet, but the Web site likely will sell regular tickets for all airlines along with discounted seats on United flights.

Air Canada, America West Airlines, and Northwest have invested in GetThere. Brick-and-mortar agency American Express also invested in the company and, apparently, will be taking over the ITN consumer Web site.

Mega-agency Rosenbluth International bought the financially troubled Biztravel.com online travel sales operation, with minority investments from Continental Airlines, Marriott International, and British Airways.

Some of this has been anticipated. One of the wisest men in the electronic travel distribution field, John F. Davis III of Pegasus Systems, owner of TravelWeb, wondered last year why more "real world" agencies hadn't moved online quicker.

The trend will only accelerate. Marriott and British Airways said they invested in Biztravel to learn more about online sales. Other companies, Davis told my newsletter, will climb on board the investment train as they learn how financially successful investments such as Delta's in Priceline have been.

For years we've seen a love/hate relationship between airlines and hotels, on one hand, and online agencies, on the other. As they cuddle now in the same beds, where does that leave consumers?

It could be good for them. It could mean more information and a reservations process that more tightly ties together regular air prices and, for example, weekend specials.

I'm not holding my breath. As the noose grows tighter, I think we'll see fewer choices and less information. I hope relatively independent online sellers like Preview Travel -- and independent online sources of information like Ticked.com -- flourish.

David Kirby is the editor of the Interactive Travel Report. His column appears on Friday. You can reach him at dbkirby@pressroom.com.