Expedia, Travelocity ready India operations
Indian online travel agents say they are losing money, and hope the sector will turn profitable in 2-3 years
The world’s largest online travel provider, Expedia Inc., which makes online bookings worth $20 billion (Rs79,400 crore) a year on its Expedia.com travel portal, will start its Indian operations early next year.
Bellevue, Washington-based Expedia, which was originally promoted by software major Microsoft in 1996, is starting an exclusive website for India to facilitate online purchases of tickets for domestic and international travel.
The company offers a choice of more than 80,000 hotels across the globe.
Expedia’s plans for the Indian online travel space, already crowded by struggling domestic start-ups, coincides with the consolidation by another international player, Travelocity.com LP, here.
Travelocity.com, which had started hotel bookings in India in March, will start selling airline tickets on the Internet by December, a month before Expedia.com.
Online travel agents, better known as OTAs, are Internet-based travel agents that help customers in booking airline tickets, hotel reservations, car rentals, cruises, vacation packages and other services online.
Leading Indian OTAs are MakeMyTrip (India) Pvt. Ltd, Yatra Online Pvt. Ltd and ezeego1 Travels & Tours Pvt. Ltd, all three of which run eponymous travel portals, and Travelguru.com. Besides Expedia.com and Travelocity.com, other leading global OTAs include Priceline.com and Hotwire.com.
“The total travel spend in India (including hotels) is estimated at $46 billion. Out of this, 3% is done through OTAs. With this kind of growth, the travel spend is expected to grow sevenfold and the share for OTAs will shoot up to $5 billion by 2010,” said Vish A. Viswanathan, vice-president, business development, at Sabre Holdings, the parent company of Travelocity.
Worldwide, the total spending on travel is estimated at $1 trillion and 25% of this done through the Internet.
Executives at Indian OTAs— mostly financed by venture capital funds—while attending a seminar organized here by Eyefortravel, a global online publisher focusing on distribution, marketing and technology developments in the travel and tourism industries, admitted they are losing money and hoped that the sector would turn profitable in the next two to three years.
“We will be starting our own website in India shortly. We have the strength of our international experience and exposure. Based on that, we will build our Indian operations with a long-term view,” said Sharat Dhall, managing director for India at Expedia.
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source: P.R. Sanjai, http://www.livemint.com
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