Duff on Hospitality Law

This week’s Update features a recent Skift story that tries to answer a question that I know many of you have asked...What’s Barry Diller’s next move with Expedia? Enjoy.

Expedia Group’s Trivago Found to Have Misled Consumers
(“Trivago's 'cheapest' hotel-room offer misled consumers, Australian court finds,” MLex Insight on Jan 20, 2020)
In a ruling issued last week, the Australian Federal Court found that Trivago breached Australian Consumer Law by making misleading statements about rates on its website and in television advertising. While Trivago claimed to provide travelers information on hotels with the lowest hotel rates, the Court found that instead, Trivago provided travelers with rates for hotels that paid Trivago the highest click-through fees. The Court further found (like regulators in many other countries) that Trivago’s use of strike-through pricing gave travelers false impressions as to the relative value of the advertised rate.  According to the Australian Competition & Consumer Commission (the Australian regulator that brought the clams), the Court’s decision “…sends a strong message to comparison websites and search engines that if ranking or ordering of results is based or influenced by advertising, they should be upfront and clear with consumers…”

This week’s Update features a number of stories on growing online travel platforms – including the launch of an entirely new travel application and the possible resurrection of an old familiar travel application.

Blackrock Embraces Hotel Technology Space
(“SiteMinder Gets Funding Boost as Financial Titan BlackRock Bets on Hotel Tech,” Skift Travel News, January 16, 2020)
Another billion-dollar unicorn is possibly in the making. Last week, Blackrock, the world’s largest money manager, led an investment round in channel manager, SiteMinder, that values SiteMinder at a staggering $750 million. To put this in perspective, SiteMinder reported revenues of only $67 million in its most recent fiscal year that ended on June 30, 2019. To justify such a large valuation (and Blackrock’s bet on the channel manager), SiteMinder will need to find a variety of new products and services to offer its existing and prospective hotel customers. So why SiteMinder? Why now? Is Blackrock’s embrace of this relatively small channel manager an anomaly or the sign of more things to come?

Russian Investigators Looking into Booking.com’s Practices
(“Russian competition watchdog opens investigation into Booking.com,” Reuters on Dec. 30, 2020)
On Monday, December 30, Russia’s Federal Anti-Monopoly Service (FAS) announced that it was launching an investigation into Booking.com and its practices. According to the announcement, Booking.com is alleged to require rate parity among the distributions channels used by Russian hotels participating on the distributor’s platform. If found to have violated Russian anti-monopoly laws, Booking.com faces penalties of 1-15 percent of its Russian revenue.

With 2020 now upon us and 2019 in the rearview mirror, I thought this would be a good time to take a look back at the stories (and the themes that the stories represent) we covered in 2019 that I believe will have the largest impact on hotel owners and operators in 2020 and beyond. I hope that you will enjoy.