Largest hotelier group takes stance against last-room availability

November 11, 2009 | Hospitality Industry

AAHOA is opposing any attempts by the OTAs to compel hotel owners to relinquish control of their room inventory and their pricing in exchange for a listing on the OTA websites, because this will harm the hoteliers, the hotel brands and the traveling public, the association says.

On November 4, 2009, the Asian American Hotel Owners Association (AAHOA), the world’s largest association of hotel owners, achieved a new milestone by registering more than 10,000 members who own 22,000 hotels, which is forty percent of all hotels in the United States.

AAHOA continues to stand firm for its members, and has taken a strong stance on important issues involving the online travel agencies (OTAs) that provide booking services for the industry.

In recent years, OTAs such as Expedia, Hotels.com. Hotwire.com, Travelocity, lastminute.com, Priceline, Orbitz, CheapTickets, Lodging.com and others have offered planning services and booking capabilities to travelers, which have largely benefited hotel owners by attracting guests to their hotels and boosting occupancy with sales of excess rooms on low demand days. The OTA business has continued to grow as more travelers are seeking convenient and inexpensive ways to plan their trips and shop for discounted room rates through the OTA sites.

With the increased competition among the OTAs to capture billions of dollars in revenues from the traveling public, however, the OTAs have gradually been gaining control of certain important decisions that historically were made by the hotel owners. To protect its members from a loss of control of their hotel operations and long-term investments, AAHOA announced today that it is taking a strong stance against two of these OTA positions. AAHOA is opposing any attempts by the OTAs to compel hotel owners to relinquish control of their room inventory and their pricing in exchange for a listing on the OTA websites, because this will harm the hoteliers, the hotel brands and the traveling public in the upcoming months and years.

Specifically, AAHOA strongly opposes (1) any attempts by the OTA’s to absolutely mandate last room availability, which would require the hotels to list their last available rooms on the OTAs at discounted prices, regardless of the market strength and demand for such rooms, and (2) allowing the OTAs to command rate parity and preclude hotel owners from offering discounts on their guest rooms that were greater than what was listed on the OTA website.

“AAHOA cannot remain silent on these important issues,” said AAHOA Chairman Tarun S. Patel, CHA. “The demands of certain OTAs that the hotels give up control of their room inventory and pricing in order to be listed on the OTA sites will have a devastating impact on our members and the industry as a whole. AAHOA is sending a strong message that these terms in their current form are unacceptable. Hotel owners are growing increasingly frustrated with the continuing erosion of their ability to operate their hotels in a manner that allows them to provide excellent services to the traveling public. There must be a common sense approach to working together that aligns with the basic rights of hotel owners to control their own room inventories.”

“For many years, the OTAs have provided a benefit to the travel industry by offering excess hotel rooms at discounted prices,” said AAHOA President Fred Schwartz. “While we can’t have OTA sites usurping hotel branded sites, we do recognize the contributions that the OTAs have made to the traveling public and our industry. With the current economic conditions, it is critical for our members to maintain occupancy levels, but not at the risk of losing control of their room availability and pricing. AAHOA owners have invested their life savings in building and operating their hotels, and we cannot look the other way when third party agencies are trying to vest control from the members in order to gain a greater share of the market.”