Travelocity.com is set to announce a new, stronger hotel price guarantee and a reduction in hotel booking fees, marking the latest salvo in the battle of the online travel sites: Travelocity.com, Orbitz.com and Expedia.com.

Travelocity is planning to announce that travellers who book hotels on its site, and then later find the same reservation at a lower price online, anytime before the day of check-in, will be refunded the difference between the prices, effectively guaranteeing the lowest hotel rates on the Web - except for name-your-own-price deals.

And until Dec. 31st, Travelocity will also throw in an extra $50 discount toward your next trip. The company first launched its price and service guarantee in 2005. Travelers need to send a screen grab or other proof of the lower rate to Travelocity.

“For several years, the Travelocity Guarantee has been a key differentiator for us,” Tracey Weber, president of Travelocity North America, said in a statement. “For it to remain that way, we realized that it was time to bring our competitive prices more to the forefront. Giving our hotel shoppers the most flexibility and peace of mind when they book through us was the logical place for us to start.”
Travelocity will also announce that it’s dropping or lowering its hotel booking fees. The agency, for instance, will drop its change or cancellation fees for hotel rooms and regular vacation packages (last-minute packages are excluded).

Travelocity, a unit of Sabre Holdings, is in competition with other major online travel-agent companies such including Orbitz and Expedia, all seeking a larger slice of the hotel-booking business.

All these major online travel agents now forgo charging a booking fee for airline tickets, decimating those sales as a source of revenue.