Our weekly Online Travel Update for the week ending February 3, 2023, is below. This week’s Update features of number of stories detailing the Biden Administration’s growing efforts to address “unfair” fees, including hotel resort fees. Enjoy.
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- Biden Calls for Legislation Limiting Unfair Fees. Add ticket agency fees (thank you Taylor Swift) to the growing list of “unfair” fees being targeted by the Biden Administration. In comments at last week’s meeting of the White House Competition Council, the President called on Congress to pass legislation (the Junk Fee Prevention Act) limiting fees in several industries, including an outright ban on “surprise resort and destination fees.” The likelihood of any substantive legislation coming out of Congress – particularly given the strong business interests that will likely line up to oppose any such legislation and the general divisive (dysfunctional) nature of Congress – is very low. While federal legislation may be a remote possibility, the same headwinds may not hinder similar efforts at the federal regulatory level (FTC) or individual state level. This week’s news of possible federal legislation on the issue comes as several clients are hearing rumblings or actually receiving written notice of increased efforts to reign in resort fees at the state level.
- Google’s Overall Advertising Revenues May Be Down, But Not for Travel. While overall Google’s parent, Alphabet, saw a fourth decline in overall advertising revenue, travel advertising revenue actually increased over the latest quarter.
- Rising Interest Rates Increase Value of Merchant Bookings. With Expedia reported to have earned $20 million in interest income in the third quarter of last year, in part, on funds held as part of prepaid guest bookings, it is no wonder other platforms are getting into the payments business (yes, we recognize that there are many other benefits as well). Airbnb earned $58 million in interest income.
- Event Platform, CVENT, Reportedly for Sale. If a sale does occur, it won’t be the first time the platform is taken private. This time, private equity heavy weight, Blackstone, is the rumored suitor. Will a sale mean changes to the platform’s management (and impossible contracting practices)? Likely not, as CVENT’s management stayed largely intact through CVENT’s many prior transitions.
Have a great week everyone.