online travel site launched this past June, reported to U.S. Department of
Transportation officials today that its business has introduced much-needed
competition in the online travel sector, resulting in significant consumer
savings and convenience.
“Orbitz has energized competition in online travel,” said Jeffrey Katz,
President and CEO of Orbitz. “Due to Orbitz and its innovation, consumers now
have a comprehensive array of travel options at their fingertips that makes
travel cheaper, easier and more accessible than ever before.”
In June, Orbitz generated the largest launch of an e-commerce website
since 1999, as measured by Nielsen/NetRatings. Since that time, over 2.8
million consumers have registered to use Orbitz and made purchases of more
than $500 million, quickly making Orbitz the third-largest online travel site.
As the only online travel site displaying flight and fare information in an
unbiased manner, Orbitz provides consumers with access to the broadest array
of travel choices and information in a simple, easy-to-use format.
Research data provided to DOT today, and released by Orbitz, confirms its
pro-consumer benefits. A fare study conducted by Professor Darryl Jenkins and
BACK Aviation Associates found that Orbitz meets or beats the lowest price
quoted by Expedia and/or Travelocity on the same itinerary more than 80
percent of the time, and when Orbitz finds a lower fare, it beats the
competition by $75 per ticket on average, across all itinerary types. The
results of the study conducted in October are consistent with an earlier pre-
launch report by a leading accounting firm that found that Orbitz met or beat
Travelocity and Expedia over 80 percent of the time, with an average consumer
savings of $59 per itinerary.
“Consumers are telling us that they are shopping on Orbitz because we
offer them unbiased information with technology that is easy to use and
provides more low fares and the best travel deals available,” said Katz. “Our
launch has had a pro-competitive impact on the marketplace as other sites move
to enhance their customer service and offerings.”
That high level of competition was also reflected in Nielsen/NetRatings
findings that showed that consumers who express a strong preference for
Orbitz, Travelocity or Expedia are not reluctant to visit the other sites as
well. And, a recent study by Vividence suggested that a significant number of
consumers who had a prior preference for Travelocity or Expedia now favor
Orbitz after using the site, noting ease of use, more low fares and a better
overall display of travel information.
The 6-month progress report filed to DOT was requested by regulators in
April, after an exhaustive review by the department which ultimately dismissed
the claims of other travel distributors that Orbitz` technology and ownership
structure would be anticompetitive. Katz said that the Orbitz filing confirms
the DOT`s earlier conclusions about the competition and consumer benefits that
the Orbitz launch would bring.
“Despite the setbacks suffered by the entire travel industry after
September 11, our traffic and sales continue to grow as consumers recognize
the value of direct access to prices and schedules,” said Katz. “More and
more people are tapping into the Internet to make their travel purchases. Our
unbiased displays and customer service programs are critical elements in our
The Orbitz Traveler Care program that includes Travel Watch, Orbitz news
and information hub, has become an even greater resource for consumers since
the tragic events of September 11. Orbitz Care Alerts not only helps
travelers avoid airport delays, but also alerts them, as well as family or
friends, to changes in the flight schedule, arrival and departure gates or
baggage claim. More than 15,000 Orbitz travelers use the Care program every
Katz noted that the website`s Consumer Advisory Board had filed a
supplemental report to the DOT, cataloging the commentary of users and their
favorable response to the Orbitz technology, wide selection of low fares and
excellent customer care and service.
Orbitz reported that it has also lowered distribution costs for travel
suppliers, saving airlines, hotels and rental car companies millions in
commissions and booking fees over the last six months that would have
historically gone to the oligopoly global distribution companies that control
the reservations systems.
Katz said Orbitz will continue to make improvements, and expects more
airlines, hotels and car rental companies to partner with the site as “charter
associates,” which will allow them to make their website specials and other
publicly available travel deals available on Orbitz. In addition, a new
hotel search engine is already in place, and other enhancements, including the
expansion of customer service programs and an improved international airfare
search capability are in the works.
Orbitz is a new full-service online travel agency offering consumers the
widest selection of low airfares, as well as deals on lodging, car rentals,
cruises, vacation packages and other travel. Orbitz` state-of the-art flight
search engine searches 450 airlines—up to 2 billion flight and fare options
—offering the most unbiased and comprehensive list of airfares and
schedules. Founded by the world`s leading airlines—American, Continental,
Delta, Northwest and United airlines—Orbitz also has the Internet`s biggest
collection of low-cost, web-only fares—from a wide array of airlines.