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Microsoft, Amex team for travel

In another sign of the online travel boom, Microsoft and American Express preview a new reservation service for companies.

In another sign of the online travel boom, Microsoft and American Express today previewed a new reservation service for companies.

Named AXI, for American Express Interactive, the service allows companies to use their preferred air carriers, discounts, and travel policies in a customized profile. It is designed to get the lowest fares and allow travelers to make last-minute flight changes--without a travel agent.

In today's demonstration, Amex executives booked a flight between Chicago and Dallas, a rental car from Hertz, and a hotel room online in less than 10 minutes. The service typically will cost up to 40 percent less per transaction than a traditional booking, excluding set-up fees, said Mike Mulligan, a senior vice president for American Express. He said the product goes into beta in July and will roll out this fall.

"More than a quarter of our customers--representing $4 billion in annual travel bookings--say they want to try this," Mulligan said. The reason: Travel and entertainment often is the third-largest expense for companies, behind labor and data processing. U.S. companies spend $15.8 billion annually in this market, he added.

For Microsoft, it is the latest example of the company's expansion into new interactive ventures. The service is not meant to compete with Expedia, the Microsoft travel service aimed largely at consumers.

Microsoft and American Express are well-recognized brand names, but the venture faces competition from other online services and established travel agents.

Sabre, controlled by the parent of American Airlines, offers a similar service for corporate travel. Yet another is the Internet Travel Network.

Online travel is projected to be one of the fastest-growing segments of e-commerce.

Still, many companies prefer to have in-house travel agents on call. Their employees prefer face-to-face contact, and some of them complain that the services are too time-consuming and hard to use.