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From Looking to Booking: Online travel comes into its own Since the Web's early days, searching for travel information has been one of the most popular online activities. The Web, however, has become much more than a library of travel information. Internet users are booking their travel through online services at a rapidly growing pace, making online travel one of the most important e-commerce categories and causing upheaval in the travel industry. Bizrate.com recently reported that 85% of online shoppers plan to use the Internet to help them with their holiday travel plans, while a Forrester Research analyst told Business Week that approximately 9 million Americans will book travel online this year, resulting in nearly $8 billion in online travel revenues. At the same time that online booking creates opportunities for travel sites, it is also beginning to pose a threat to traditional travel agents. A recent survey from PC data found that online shoppers purchased more than twice as many tickets over the Internet as they did from travel agents, with 38 percent of U.S. Internet users going online to buy their Thanksgiving travel tickets. Travel sites such as the one created by the recent merger of Travelocity & Preview Travel rival top online retailers such as EBay and Amazon.com in registered users and revenues. Combined, the newly merged travel companies boast over 17 million members with sales projected to exceed $1 billion for 1999. Flying with the net The speed with which consumers are choosing to go online for travel purchases has not gone unnoticed by the major airlines, which are scrambling to position themselves for the transformation of their industry. Earlier in the month, United Airlines, Delta Airlines, Northwest Airlines and Continental announced they would form their own online travel portal in the first half of 2000. The portal will enable consumers to compare and purchase tickets from multiple airlines. Business Week noted that this move signals the airlines' intention to move aggressively into booking tickets, something that will put pressure on traditional travel agents as well as online travel sites. The major airlines have also thrown considerable support behind Priceline.com. The company's name-your-price service matches travellers -- who submit the price they are willing to pay for tickets -- with the airlines' best offers. Priceline.com recently added United Airlines, US Airways and American Airlines to its service, agreeing to pay the airlines over $1 billion for their support. While Priceline paid dearly for the agreements - TheStreet.com's Aaron Task estimated that Priceline will have to sell 46.2 million tickets to recoup the charges - most major media were agreed that the deal lends further legitimacy to Priceline's business model. With these agreements, Priceline is rapidly emerging as a major player in airline travel. The company has now reached deals with eight of the nine major U.S. airlines and is selling over 50 000 airline tickets a week. Related links & sites Priceline.com
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