Expedia Has a Google Problem – Barron’s
Google, owned by the Alphabet corporation, has been launching its own travel tools in recent years. In 2015, it began allowing users to book hotel rooms using Googleâ€™s interface (though the transactions were processed by third parties), and last year it released the Google Trips app that gathers travel information from usersâ€™ Gmail accounts.
The search giant has also made it harder for other companies to get free exposure from searches in some cases. Google expanded the amount of spots for its paid desktop search options last year. At times it has gotten more aggressive in promoting its own services when people search, coaxing them to explore Googleâ€™s travel options first instead of immediately directing them to Priceline or Expedia. That leaves less room for other brands to promote their offerings directly.
Google already has a $12 billion travel business, compared to less than $9 billion for Expedia, according to travel news and research site Skift.
Much of Googleâ€™s travel-related revenue comes from charging online travel sites like Expedia to advertise. But even if Expedia is a valued Google customer, it is also a competitor, and CEO Dara Khosrowshahi has made it clear that Google has been a challenge for its HomeAway vacation rental business.
Google has taken â€œmore and more of their screen space and monetizes that screen space,â€ Khosrowshahi said on a conference call following the companyâ€™s fourth quarter earnings release on Thursday. â€œBut players like ourselves donâ€™t have much of a choice because of Googleâ€™s market power.â€
Big Picture: Expedia could see a growing threat from Googleâ€™s expanded travel business.
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