Accommodation Association of Australia (AAA) is currently in the midst of an appeal to the competition watchdog in an effort to break a duopoly in the industry that’s ramping up hotel room rates for consumers.
According to the AAA, guests are paying up to 15 per cent more on room rates than they should because of the control leading online booking websites, such as Expedia and Booking.com, have on the market.
Latest figures show that these two agencies specifically control about 80 percent of the Aussie market.
In order to break this strong-hold on the market and give more control back to hotel operators to set rates, the AAA have lodged a formal request to the Chairman of the Australian Competition and Consumer Commission (ACCC) in the form of a letter.
In the letter, AAA CEO Richard Munro voiced the concerns of the industry who argue that the recent ACCC ruling to allow online travel agencies to advertise their rooms at the lowest possible price is unfair, as it means hotels can’t offer a cheaper price unless they were contacted directly by a prospective customer.
According to AAA CEO, Richard Munro, hotels are often able to offer much better rates when booking directly through them because of the commissions charged by Expedia and Booking.com:
“The commissions are as high as 20 per cent. They’ve almost doubled in recent years and it’s only going to get worse for as long as these two command such control.”
Richard Munro, CEO, AAA.
“To say members of the AAA are angry with the outcome of the ACCC investigation is an understatement,” Mr Munro stated in the letter.
“The ACCC is seemingly unaware that the overwhelming majority of accommodation bookings in Australia in 2016 are made via the internet, and very few bookings are made directly with accommodation businesses and/or through walk-ups.”
Stay tuned to KarryOn for future developments on AAA’s appeal to the ACCC.
Source: News.com.au