If Travel is Down, Why Are Travel Web Sites Doing Well?

Both Priceline and Orbitz reported higher revenue and profits than expected in the third quarter, despite a travel industry-wide lull. So, why are the online travel agencies doing well when other aspects of travel are flailing?

Some say it’s because the leisure travel market is recovering faster than business travel, but I also think that an online travel agency has far less risks than a major airline or hotel chain.

In fact, from previous reports, we know that such Web sites are muscling lower hotel prices when possible and can be seen as competitors more than collaborators. In several scenarios, OTAs gain profits while their member hotels lose them. Many critics of the Web sites say it’s the price hotels and airlines are paying for not offering great deals directly to consumers.

Get the full story at: Bnet