In the 1800’s the British were exchanging heroin with the Chinese for porcelain and silks. The Chinese emperor objected and took action so naturally the British went to war. The result - the British East India Company got beautiful Chinese goods to sell to the global market in exchange for drugs.
Two centuries later tourism is becoming the world’s biggest activity. More and more tourism businesses are finding that it is difficult to get to the global market except through an OTA, which not only typically charges 15%-25% but also captures guest’s data for future business.
Why are the OTAs (eg Priceline, Tripadvisor, AirBNB) in this oligopolistic position?
There are three primary reasons:
The first is money. Because they have captured the market and therefore have a lot of dosh, they can spend squillions with Google – Priceline alone is said to give that nice Mr Google $2billion plus a year.
The second is power – Wall Street just loves them and they fight every fight. Whether it’s parity pricing or taxi driver’s strikes – they are there slugging it out like Uber.
And the third is the acquiescence of the destinations, which I don’t get. If the OTAs built a real paywall around New York you can imagine what Mr Bloomberg would say. But a virtual $trillion paywall? That’s for the techies!
They say when the going gets tough the tough get going – so where are the tough destination politicians?
SHARING ECONOMY – MORE SHARE, LESS FAIR: AirBNB – who’s sharing with whom?
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TAKE OWNERSHIP OF RESPONSIBLE TRAVEL - warts and all #rtweek16
BRUSSELS SET FOR SUSTAINABLE destinations ETIS EU meet:
SISTERHOOD OF NEPALESE SURVIVORS, tech park, treetop walk, honoured by UNWTO
TRANSFORM THE WORLD says the International Ecotourism Society in Tampa
TOURISM VALUE UP and up thanks to China and USA: 1.2billion destination opportunities –for who?
Comments, by the way always very, very, very welcome indeed.
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Valere Tjolle – Principal
Eagle House: Batheaston: BA1 7EH: UK
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