23 airlines join big four on travel Web site

January 13, 2000 CHICAGO - The Web-centric travel sellers are getting some more online competition. Today, it was announced that 23 US and foreign based airlines will become charter associates in the new Web-based travel business being developed by Delta Air Lines, United Airlines, Northwest Airlines and Continental Airlines.

The big four airlines announced their Web site collaboration last November. Most analysts saw this move as a response to the booming success of Web-centric travel sellers such as Expedia, Travelocity and Preview Travel. "The Web site will provide far more for consumers than other travel sites," said Ben Burnett, a Chicago-based vice president at the Boston Consulting Group, which, as interim management for the new airline company, is overseeing the development of the Web site. "We are creating the most customer-centered travel site on the Web. "These agreements with 23 additional airlines indicate tremendous progress in the development of the new Web site. We expect other key industry leaders, with whom discussions are in progress, to join us in the near future," Burnett said.

The airlines are marketing the new Web site as "the Internet's most complete choice of travel products and services at prices equal to or lower than those available from any other travel source." As US-based charter associates, American, US Airways, ATA, AirTran, Hawaiian, Midwest Express, Midway and Vanguard will make available on the Web site comprehensive seat inventories at fares as low or lower than those available from any other source. The foreign-based carriers that have signed identical agreements are Air Canada, Air Jamaica, Air New Zealand, Alitalia, All Nippon Air, Austrian, British Midland, COPA, CSA Czech, Iberia, KLM, Korean, Mexicana, Singapore and Varig.

All participating carriers said they will offer the most comprehensive collection of their Internet-only fares on the Web site. The site will offer consumers "one-stop shopping with the Web's most complete selection of travel products and services from virtually all air carriers, hotel chains, car rental companies, cruise lines, vacation packagers and other travel suppliers worldwide, " Burnett said. As with the founding airline partners, the Web site's additional airlines announced today will provide a number of services to the site. These services include co-op marketing programs, access to customer loyalty programs and exclusive marketing support.

Discussions are ongoing with additional airlines and other travel providers such as major hotel operators. The name for the Web site, which is scheduled to launch during the second quarter of this year, is expected to be announced within 90 days.

All participating airlines will continue to operate their respective Web sites as well as participate in other travel Web sites. The new company will be managed independent of its suppliers. A search is underway for a management team.

"By combining the vast amount of Internet experience of all the launch partners, we will create a site that is superior to all travel sites," said Vince Caminiti, senior vice president at Delta Air Lines, when the mega-site was announced in November. "The new site will offer the most convenient features of any online travel vehicle." Caminiti said that by "using innovative search capabilities," travel consumers will be able to use the site to find travel information on many of the world's most popular travel products. He said price conscious customers, for example, will be able to use a special price search feature to locate products suiting their budget needs. Customers concerned with convenience will use a special flight schedule search engine, he said. "Our site will offer customers the best of everything," said Al Lenza, vice president at Northwest. "The best collection of Internet fares in one location, the best search capabilities and the best travel-related content," Lanza said.

However, as the airlines step up Web spending with the goal of bypassing intermediaries, some online travel agencies are actually benefitting, according to a report released last week at the PhoCusWright LIVE99 Conference in Miami Beach. The report says the major U.S. airlines each are spending between $5-10 million on their Web site initiatives this year. Though significant, these investments won't put online travel agencies out of business. As a whole, the online travel agency market will remain viable, according to results from The PhoCusWright Yearbook 1999: Analysis, Assumptions And Assessments For The Online Travel Marketplace. Online travel agencies' market share will even increase slightly from 51% in 1998 to 52% in 2001.

Source: WebTravelNews.com