TMCs Seek Rejiggered Hotel Revenue, Drawing ‘Shell Game’ Accusation

Big travel management companies are beefing up their hotel programs. They say it's a content play. Aggregating inventory, special prices and perks counteracts fragmentation. It gives their clients' travelers less reason to stray from managed programs. That improves reporting and risk management. All good stuff. But, wait. Follow the money.

First, a bit of history. U.S. airlines chipped away at base commissions in the years before and after the turn of the century. That led to an overhaul of TMC economics. Transaction fees charged to clients became the norm. But TMCs didn't forego revenue from suppliers. They . . .

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Author: David Jonas

David Jonas in 2006 co-founded business media firm ProMedia.travel after ten years as a journalist with Business Travel News. David rejoined BTN in 2010 as executive editor when its parent company acquired ProMedia, and in 2014 co-created The Company Dime. David has a bachelor's degree in communications from Cornell University.

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Grant Caplan
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Grant Caplan

Great job as always. Bob Langsfeld’s advice is, as always, excellent. It would be different if the industry were more forthcoming, but the frustrating part is the glad-handing that goes on in the name of getting the business (and then changing terms half-way through the contract period without notifying us as their travel-buyer clients). If the truth were told more often, it would be easier to deal with — not just in our industry, but many industries. This is why I treasure the relationships I do have where I believe truth is being told.