Orbitz in talks to sell to travel agencies
The company is in talks with a software maker that could help the travel site sell fares to traditional travel agents and avoid mounting legal hassles.
"We're in discussions for ways to make travel agents' lives easier by allowing them to leverage Orbitz technology," Orbitz spokeswoman Stacey Spencer said.
Aqua Software, a unit of corporate travel-management company Navigant International, is offering to construct a system by which brick-and-mortar travel agencies could book fares via Orbitz, which currently sells tickets directly to the public via the Web.
One of the top three travel Web sites, Orbitz has come under investigation by the government for its exclusive access to the heavily discounted Web fares of many airlines. Critics say that access amounts to a violation of antitrust regulations.
U.S. Department of Transportation Inspector General Ken Meade is currently reviewing Orbitz's business practices--the second time the company has come under government scrutiny since its founding in 2000. The Department of Transportation, Meade and the Senate Commerce Committee determined last year that Orbitz did not violate antitrust regulations at the time, allowing the company to proceed with it business plans.
Most traditional travel agents book tickets through Computer Reservation Systems (CRS), systems used to compile flight information and disseminate it all over the world.
But the airlines can bypass the booking fees that the various CRS systems charge by selling tickets online, using their own sites as well as Orbitz and other Web travel agencies. The airlines, mired in one of the worst travel slumps in the travel market's history, are eager to find ways to save money.
By cutting out the middleman, Orbitz claims to be the lowest-cost distribution method for the airlines. But a backlash has plagued the Chicago-based Orbitz, even before it opened for business last summer.
The president of Aqua, which provides technology that automates certain tasks faced by traditional travel agents, praised the idea of linking Orbitz and brick-and-mortar travel agencies.
"The best way to alleviate the competitive disadvantage facing travel agents, while preserving the cost savings that airlines can achieve in reducing their distribution costs, is to allow travel agents access to Internet-only fares," Rick Ferguson wrote in a letter to the chairman of the Subcommittee on Regulatory Reform and Oversight Committee on Small Business, which is holding hearings on how Orbitz is effecting small travel agencies.