UK’s OTA investigations largely have lacked teeth
 
UK’s OTA investigations largely have lacked teeth
02 JULY 2018 7:17 AM

The U.K.’s Competition & Markets Authority seems at long last to have gotten tough with what it sees as misuses of practice on hotel booking websites, but cynics might say we have seen this all before.

The United Kingdom’s business fairness watchdog, the Competition & Markets Authority—the U.S. equivalent of the Federal Trade Commission’s Bureau of Competition—has bitten again, and it might just be that the teeth of this government body have been somewhat sharpened, for the first time in a long time.

Might just be.

On 28 June, the authority announced it had sent out instructions to “a number of hotel booking sites” asking them to review their online selling techniques.

It does feel a little Groundhog Day, I have to say.

The CMA also stated in a news release that as part of its ongoing investigation, it “has identified widespread concerns,” which suggests to me the investigatory process has some time to run.

Recent triumphs from the CMA included the September 2015 decision to close one previous round of mild sabre-rattling after seemingly being satisfied with changes in practices and policies implemented by online travel agencies themselves.

I seem to remember some noise about it all being far better left to the European Union’s own investigations into other areas of alleged OTA abuse.

The EU, to my knowledge, has never come out with a set of regulations on the matter. Supposedly it could wipe the table clean with one swish of rules, but it seems to prefer to leave it to individual countries to set their own tables.

France banned rate parity, for instance, but it is not difficult to picture individual nations as individual nations and the OTAs as super-continents, or as my early geography lessons would have put it, a Godwanaland.

Back in the U.K., on 5 July last year, the CMA released new guidance stating that “hotels can choose to offer a lower price on other OTAs than they offer on Expedia and/or Booking.com … (and) hotels can also decide to offer other OTAs better availability or conditions (such as room extras or ‘breakfast included’) than on Expedia and/or Booking.com.”

As if OTAs did not have a host of other tricks to play with in regards to price, offer, conditions and search algorithms. And the cynic in me rather supposes government does not like to interfere with business, especially ones where the deal is of the most importance to the customer, not the machinations of the deal or where their money ends up.

In July 2016, the CMA sent hoteliers a questionnaire to gauge the effect of OTA practices on their businesses.

More kicking the can down the road, and I am not so sure it will be much different this time around.

Then again, all these alleged bad practices pale into comparison, I feel, or at least are on equal terms with airlines overbooking their planes and then bumping passengers who might have to be somewhere.

This is what will happen. The hotel booking sites will change a few things, but not so many; then they will come up with ingenious new ways of maintaining share of wallet; the CMA will take an age to see not a great deal has happened, at which time it will send out a questionnaire to hoteliers; the government will get a sack of tax income; and maybe another letter will be sent to alleged miscreants to put their houses in order.

Maybe.

Or maybe we can hope the CMA has sharper incisors than the last time the dentists came over.

German hotel dip?
One thing rarer than a cordial discussion on rate parity between an hotelier and an OTA executive is a German loss in football.

The unimaginable happened last Wednesday when in the group stage of the FIFA World Cup 2018, Germany had to beat South Korea to get through to the knockout round after it already lost to Mexico and survived by the skin of its teeth with a last-minute goal against Sweden.

It did not beat South Korea. It lost 2-0. It is out.

It will be interesting to see the effect on Germany hotels and hospitality. Hotel bars probably did well during the three games Germany played before exiting the tournament, but will they do equally well for the rest of the competition, which ends on 15 July?

Maybe the bars will be full anyway (with presumably the sports channel not selected) with people enjoying hearty German fare and warmth, or maybe all Germans are now searching for deals at a hotel near you so as to escape football and Germany.

I shall keep an eye peeled for data.

And I should add that England has largely been hopeless in the World Cup in the last number of tournaments, so we might soon be experiencing the same desire for escape and quiet.

Email Terence Baker or find him on Twitter.

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