Bing's Visual Search Has Me Seeing Stars

Bing introduced visual search in beta this afternoon and its prospects have me envisioning its applicability in travel.

Speaking at the TechCrunch 50 conference today minutes prior to the visual-search launch, Yusuf Mehdi, Microsoft senior vice president, online audience, told attendees that Bing has to take some major steps, as opposed to modest innovations, if it wants to compete with the likes of Google.

Mehdi placed visual search in that big-step forward category.

For now, Bing users can opt to search entertainment, famous people, reference, shopping and sports using visual search.

Users, for example, can search for HDTVs and then drill down and reduce the number of images by brand, type, screen size and resolution to pare shopping choices.

In an era when user interfaces are evolving with touchscreens, videos and imagery, substituting visual search for clunkier keywords seems like an appealing way to open up e-commerce and search to a segment of consumers who are looking for more intuitive ways to browse and take action.

Using images to search for HDTVs, cellphones, cars and movies seems like a way forward, but will it work in the complex world of travel where apples and oranges grow on the same vine?

I don't know precisely what Bing Travel will do in visual search, but I have to believe that it will get involved.

UPDATE: Bing Travel indeed has introduced a bit of visual search with a travel-related twist in the form of travel destinations with data partner Fodors Travel. There is no booking capability tied to this informational effort.

In the left-hand column, users can narrow their search by the best time to visit, continent, region and flight time, and then click on an image to access Bing links about that destination.

I didn't find it particularly useful, but this is day one.

Without tipping his hand, Hugh Crean, the general manager of Bing Travel, said Bing Travel "is working on launching a number of new and interesting travel scenarios."

So, there's more to come from Bing Travel in visual search.

Will we see consumers searching for hotels using property images and then whittling down their choices by brands, star ratings, price ranges and facilities like indoor pools or spas?

If the user interface is right, this could make for a more compelling shopping experience for some travelers.

Which would be easier and more interactive? Sorting out where to stay by clicking on a few images or plodding through pages of listings and links?

Many travel agents still prefer linear results on green screens to sexier GUIs, and some consumers will still prefer keywords to images.

But, visual search could open up paths for the more graphically minded.

Visual search has been tried elsewhere with poor to mixed results.

So, let's see if Bing can get things off the drawing board.

And, at the least, this Google-Bing donnybrook is great for consumers and innovation.

Google is so big it doesn't have to react tit-for-tat to Bing.

But, Bing's introduction of visual search will give Google another pesky nudge.

Priceline on Metasearch, Hotel Reviews and Mobile

My first blog post, Travel Metasearch: Frenzy or Finale? on March 12, took up the question of whether metasearch was "done." (By the way, it's not.)

Priceline.com President and CEO Jeffery Boyd weighed in on the issue at the 2009 Citi Technology Conference last week, arguing that metasearch "didn't live up to the hype."

Boyd has been a persistent metasearch critic, but Priceline long has participated in its advertising channels.

The Priceline CEO conceded that Kayak "has done very well," but he believes its success is more a testament to its user interface and technology than to metasearch having a superior business model when compared with that of online travel agencies.

With all of the OTAs having eliminated flight-booking fees, there now is "no magic bullet" when shopping at 100 websites for airline tickets, Boyd said.

He acknowledged that metasearch represents some threat to OTAs, but the key test for metasearch websites, in general, and for Microsoft's Bing Travel, in particular, will be whether they will be able to continue to deliver qualified leads to OTA advertisers.

On the advertising theme, Boyd said Booking.com, Priceline's Europe-based lodging business, has probably left some money on the table by refusing to initiate a media business and adding a lot of non-hotel products.

Booking.com has avoided these distractions because the upside of expanding hotel inventory for European travelers in Eastern Europe, Asia and North America is so "great" and "important" that dabbling with cross-selling these non-hotel products would be unwise, Boyd said.

Booking.com, Boyd said, doesn't have exclusive hotel deals across-the-board with independent hotels, but in practice it often has exclusive availability for many properties as a distribution channel of choice because of the demand it can generate for a property in far-flung countries and because of the advantages of the retail model.

Turning to other issues, Boyd said travelers' hotel reviews, after they completed a stay at a property, are "an element of social networking that is very helpful," and he sees the scope of reviews expanding with photos and videos that will make them "more engaging."

Looking into his crystal ball, Boyd sees several other areas ripe for increased attention, too.

Trip planning and trip organization, as is the focus of TripIt, is an "open playing field," Boyd said.

In addition, mobile will be among the "most-impactful innovations," Boyd added.

Boyd argued that over time mobile offerings and consumer behavior will change so that some travelers will feel comfortable booking hotels "on the fly" with a mobile device once they arrive at a destination.

He said Priceline and others will introduce technology, which would ensure that travelers would find great inventory and deals once they pick up their bags at a destination airport.

I'll interject here that with the expected proliferation of Wi-Fi on board airlines, shopping for last-minute hotel deals may give on-board entertainment whole new meaning if Boyd is correct that a segment of consumers will be open to very-last-minute hotel offerings. Anyone for Verylastminute.com? Oh, sorry, it already exists.

"I'll get the hotel when I get there," is how Boyd envisions the new -- as yet unproven -- impulse.

But, Boyd has confidence in the shift.

"If you are there ready with a product to support it you will win," Boyd said. "If not, you are going to lose."

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Google: We Won't Be a Copycat in Travel

After writing Kayak's Hafner Awaits Google Hotels and the Brave New World of Google Travel 3.0 , I spoke with Google's managing director of travel and learned a lot more about what Google won't do in travel.

Here are some headlines from my conversation with Rob Torres, who emphasized that all options -- including the build versus buy equation -- are on the table. Torres said:

• Google monitors all competitors, regardless of their market share, but "we are not going to copycat. We will only do something if we can do it 10 times better than what's happening today."

• "Microsoft made a great acquisition in Farecast," but Google likely would take another route. "We don't have anything like that," Torres said, referring to Bing Travel, "and we don't intend to do something like that."

• Asked whether Google would acquire a company like Kayak or FareCompare, Torres said: "Would we acquire a Kayak just to be a Kayak? Probably not."

• "If anyone can come up with a game-changing opportunity" in travel, it would be Google, he said.

• Torres doesn't see Google introducing metasearch as an aforementioned game-changing opportunity. "The reality is that Kayak and others already are doing that very well."

• Kayak CEO Steve Hafner was being "highly speculative" and started from erroneous assumptions when he said Google doesn't care about flights and would bolster its stance in the travel business in the hotel sector. "We don't look at it as one versus another [air versus hotel]," but view the travel vertical "wholistically," Torres said. "I think our flight partners are very important. That's where they [most trip-planning queries] start."

• Asked why then Google did not further develop it's one-box flight search , launched in late 2005, Torres said "it has taken time to figure out the next step."

• Torres said Google's recent introductions of City Tours and Favorite Places, two travel applications leveraging Google Maps, were "nothing really big" in terms of the big picture and "not necessarily driving a travel product."

• A widely held view, Torres stated that the possibility of Google introducing a "transactional model" like an online travel agency are remote.

• Rather than attacking things piecemeal, Torres said Google looks to improve search across specific verticals and industries, including travel. He said Google has tremendous relatively untapped assets, including Google Maps, Google Base and YouTube.

So, now we know some of the things that Google likely will not do in travel.

Torres said that "time will tell" what steps Google would take.

Of the travel business, Torres said: "Certainly our interest hasn't waned over time."

Related Post

Google travel is coming… could it be a hotel PPC system?

Kayak's Hafner Awaits Google Hotels

Kayak CEO Steve Hafner thinks "it's only a question of time" before Google begins displaying hotel pricing, a move that could change the online-travel ecosystem.

Waiting for the other shoe to drop, so to speak, Hafner says he is much more concerned about how Kayak, the leading travel-metasearch player in the U.S., would navigate Google's souped-up role in facilitating hotel transactions than about the maneuverings of rivals like TripAdvisor, Fly.com, Bing Travel or Mobissimo.

"Google is by far the biggest source of travel information for consumers," Hafner says.

That point was confirmed for me last night when I drilled down a bit into what Google has been doing on the hotel front.

When I performed a Google search for Chicago hotels and then selected Hotel Allegro reviews, I accessed a link that produced:

• The property location in Google Maps;

• Overviews of the hotel and property details;

• Some 619 user reviews and ratings of Hotel Allegro from the likes of TripAdvisor, Priceline, HotelGuide and others;

• 50 photos and videos from the hotel itself and other content providers;

• 683 Web pages about the property, and

• Advertisements from Expedia, DealBase, Travelzoo and Hotelsmax.net.

The "look and feel" of this compilation is not very attractive, but that can be improved. And, with so many consumers launching their trip-planning through Google searches, you could argue that Google already is the most comprehensive "hotel website."

With speculation rampant about Google's next move in travel, Hafner believes he knows where Google is headed.

"Google doesn't care about flights," Hafner contends. "Hotels is where they'll enter."

He continues: "Hotels are a comparatively easy entry point and yield the highest margin for Google."

I blogged a couple of weeks ago about the Brave New World of Google Travel 3.0, arguing that Google may continue to build out its apps, from flight links to Google Maps, to put a heavier stamp on its travel offering, now that Bing Travel has raised its profile with its prominent integration into Microsoft's Bing search engine.

Hafner's theory on Google's evolution in travel is consistent with that line of thinking.

As it already does for products ranging from books to digital cameras, Google might display hotel price points in default displays and then advertisers could use Google Checkout to drive hotel transactions, Hafner says.

"So imagine a list of OTAs [online travel agencies] and suppliers, with Google Checkout to help facilitate conversion," Hafner says. "Pretty powerful."

And, Google already has another app, Google Base, featuring a data API, which perhaps could accommmodate hourly hotel pricing updates, Hafner says.

Some have argued that Google, with its market cap of $143 billion, doesn't worry about relatively little things such as Bing Travel.

But, I think with travel being such a large part of Google's advertising business, Bing's deft integration of Bing Travel in Google's own backyard has been an embarrassment to Google.

So, how would implementing hotel pricing -- and this could merely be Google's opening shot in travel-inventory pricing -- impact Google commercially?

"My guess is that it would be cannibalistic since many advertisers run their SEM [search engine marketing] campaigns on a same-session loss," Hafner says. "And, Google's opportunity to increase search share is relatively small (since it already owns 70 percent of queries in the U.S.) But, they'll probably need to move to this approach anyway to counter Bing etc."

In travel, as in other sectors, when Google bobs, the entire industry weaves.

There are lots of issues to sort out.

How would this impact the hotel-direct channel?

Who would be the winners and losers?

"It's an open question what role players like Kayak would have in a new ecosystem like this," Hafner says.

Google, by implementing hotel pricing (and who knows which travel segment after that), could certainly be disruptive.

Why would consumers navigate to TripAdvisor to read hotel reviews or to Kayak to compare prices, if they could do it all and get a more comprehensive look through Google?

Why go directly to a hotel website or to an online travel agency if you can get user reviews, maps and pricing on Google?

I received an inquiry from a business publication in Japan several months ago, asking me for answers when unfounded rumors were swirling that Google was going to launch "another Expedia."

Don't look for that sort of scenario. Google isn't going to become a travel agency.

Instead, there is plenty of room(s) for Google to expand its reach as a hotel kingmaker.

TripAdvisor Answers Back, Infers Fly.com Who?

Brian Saltzburg, a former Travelocity guy who is general manager of new initiatives at TripAdvisor, took great umbrage at my post yesterday, Fly.com Toe-to-Toe With TripAdvisor Flights.

Saltzburg didn't trash Fly.com specifically, but he made some pointed remarks about what he characterized as TripAdvisor Flights' organic-growth strategy versus those competitors which grow through unsustainable marketing spend.

Hint, hint: I think he was referring to Fly.com.

After all, Travelzoo reported this week that it spent $9.6 million in marketing in the U.S. and Canada in the second quarter, an increase of $2 million from the second quarter of 2008. And, Travelzoo attributed much of the jump to "a $914,000 increase" in Fly.com marketing.

But, first, here's Saltzburg's main beef.

Saltzburg, who heads up the TripAdvisor Flights metasearch effort, argued that the data which I used from Compete Inc. in yesterday's post "grossly under-represents" the number of searchers and visitors using TripAdvisor Flights and wrongly gives the impression that the gap between the TripAdvisor metasearch effort and Fly.com is surprisingly narrow.

The TripAdvisor official added that the Compete portrait of the metasearch market "doesn't accurately represent the trajectory of our business."

Michael Redbord , a travel analyst for number-cruncher Compete, told me yesterday that in an effort to get an apples to apples comparison between TripAdvisor Flights and competitors like Fly.com, Kayak/SideStep and Bing Travel, Compete measured traffic that came directly to domains like TripAdvisor.com/flights and TripAdvisor.com/cheapflights and didn't take into account searchers and visitors that arrived from "third-party lead generators."

Those lead generators, I believe, include Expedia Inc. units in the TripAdvisor Media Network, including SeatGuru, CruiseCritic and SmarterTravel etc.

Hence, that may be part of the reason behind what TripAdvisor perceives as a larger-than-advertised gap between TripAdvisor and Fly.com, both of which launched their metasearch offerings within a few weeks of one another in February.

Although TripAdvisor regularly boasts about its "more than 25 million monthly visitors," Saltzburg, citing competitive reasons, declined to disclose any numbers about TripAdvisor Flights.

However, Saltzburg did say that the number of searches conducted through TripAdvisor Flights in the second quarter was "significantly higher" than the 2.4 million that Fly.com disclosed.

Asked for Fly.com's take on the numbers and TripAdvisor's point that the gap is wider than Compete portrayed, Brian Clark, general manager of search products at Travelzoo, said: "Other data show Fly.com moving up the ranks as well. Hitwise shows Fly.com as the #18 most popular website under Travel – Agencies for June, which was only our 5th month of operation, and only slightly behind Bing."

Clark added: "I'm not sure where Hitwise puts TripAdvisor Flights. We’ve asked them where that site is in their rankings and they said they would 'look at the site.'”

Meanwhile, Saltzburg went on to show why he considers TripAdvisor Flights to be a different beast than its competitors.

"We are on a slow and steady growth trajectory that we feel great about," he said, adding that TripAdvisor measures itself against major OTAs and not against most of the metasearch crowd.

Saltzburg said TripAdvisor's strategy, unlike unidentified others (hint, hint) is to grow TripAdvisor Flights organically, to leverage the TripAdvisor Media Network, and to build the offering in a sustainable manner.

He claimed TripAdvisor Flights has used paid advertising to attract merely "a single-digit percentage" of its external traffic.

"We haven't had to invest negatively in our business," Saltzburg said, referring to companies who allegedly tear down profits to garner traffic.

Putting the TripAdvisor Flights-Fly.com faceoff into context, Travelzoo spokeswoman Mindy Joyce noted that "Expedia Inc. is a much larger company than Travelzoo Inc. -– over 35x larger ($2.9B to $80M annual revenues). They have many more resources which will help them drive traffic to TripAdvisor.

"With that said," Joyce continued, "we do have over 10 million active U.S, subscribers who receive deals from Travelzoo that drive traffic to Fly.com directly, and with recent fare calendar enhancements using Fly.com technology, Travelzoo e-mail subscribers have new tools that help finding airfares easier than with any other site. We are using the tools that we have very effectively."

Joyce pointed to Fly.com's 85 percent growth in traffic from May to June as evidence of Travelzoo's leveraging of its subscriber base.

"It does make us a highly relevant player in the space, only 5 months after we launched," Joyce added.

So, is Fly.com's growth strategy, replete with its marketing spend, a sustainable endeavor?

I went for an answer to someone renowned in the travel industry for having a point of view.

And, Steve Hafner, the CEO of Kayak, inferred that the jury is out on Fly.com's marketing strategy.

"I really wouldn't know if it's sustainable or not," Hafner said. "We spend a lot more and it's been sustainable."

Meanwhile, like TripAdvisor, Kayak has its eyes on other issues and competitors.

Said Hafner, "Overall, I'm not terribly interested in Fly.com, TripAdvisor or Bing. I'm much more interested in navigating a potential Google entry."

I blogged about where I thought Google was trending in The Brave New World of Google Travel 3.0.

Hafner has a somewhat different take on Google's possible entry.

Fodder for another day:)

Fly.com Toe-to-Toe with TripAdvisor Flights

Travelzoo's Fly.com is displaying surprising strength in metasearch when measured against TripAdvisor's flight-search tool in terms of unique searchers and unique visitors when you consider that Travelzoo is starting from a much smaller base.

TripAdvisor flights and Fly.com were launched within a couple of weeks of one another in February.

In dueling presentations with financial analysts this week, Expedia Inc. CEO Dara Khosrowshahi said TripAdvisor's flight metasearch offering is performing "extraordinarily well," with its searches exceeding the 2.4 million in June which Travelzoo attributed to Fly.com during the Travelzoo conference call.

Khosrowshahi said he wouldn't release TripAdvisor flights' numbers, but I will detail some. Please note that Travelzoo cited "searches" and I will detail "unique searchers." Here are some numbers that the travel team at Compete Inc. put together for me:

• Unique searchers in June: Kayak/SideStep 7,263,159; Bing Travel 1,525,604, TripAdvisor Flights 1,066,847 and Fly.com 913,637.

Compete travel analyst Michael Redbord puts Fly.com's strength in perspective.

"Compared to Fly.com, when you consider the pre-existing monthly traffic delta between respective owners Travelzoo and TripAdvisor, you're talking 4 million versus 12 million uniques (Compete June numbers)," Redbord says. "The opportunity for TA to leverage its existing engaged user base is probably at least 3 times as large as Travelzoo leveraging its own to drive traffic to Fly.com."

In terms of monetizing metasearch, the number of total searches is a more relevant metric than unique searchers or unique visitors. The number of searches that a unique searcher might conduct can vary widely from website to website.

But, Compete's unique searcher numbers, if they are to be believed, portray some better-than-expected Fly.com strength in relation to its competitors.

And, Compete's June numbers place Fly.com ahead of TripAdvisor flights in terms of unique visitors, 1,257,037 to 1,241,229. Again, that shows some unexpected muscle from Fly.com, a sort of David versus Goliath story.

Fly.com and metasearch is a key part of Travelzoo's growth strategy, along with subscriber growth for its deal newsletters. As part of that subscriber growth strategy, Travelzoo began publishing show and event advertising in its North America newsletters and is starting to do likewise in Europe and Asia-Pacific.

With the kind of unique searcher numbers and total searches that Fly.com is starting to post, it looks like Fly.com has the potential to fly.

Travelzoo reported that it spent $9.6 million in marketing in the U.S. and Canada in the second quarter, an increase of $2 million from the second quarter of 2008. And, Travelzoo attributed much of the jump to "a $914,000 increase" in Fly.com marketing.

Thus, Fly.com already is a player.

After all, the advertising/media business is hot.

TripAdvisor revenue accounted for about 10 percent of Expedia Inc. revenue in the second quarter.

Now, you know why the rise of metasearch start-ups seemingly is endless while the online travel agency business is saturated.

Thursday's Travel InsideOut

Oh, those doubters. Both the street and TheStreet.com express doubts about the Yahoo-Microsoft partnership, pointing to the distraction factor and the lack of “boatloads” of dough up-front payment for Yahoo. As the process unfolds, will travel companies place their confidence in Yahoo/Bing advertising?

The Street.com: Against the Grain: Buy Google: Marek Fuchs tells traders not to punish Google reflexively. View It

The Wall Street Journal: For Bartz, Some Potential Pitfalls Arise: Yahoo Inc. confirmed it will replace its search and search-advertising technology with offerings from Microsoft Corp., a long-awaited deal that could help the companies more effectively compete with Google Inc. Read more

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Now that Microsoft and Yahoo are cozying up to take on Google, what will that mean for Yahoo partner Travelocity and Microsoft subsidiary Bing Travel? Will it lead to a clash of online travel agency versus metasearch engine?

Dennis Schaal Blog: Bing-Yahoo Alliance Could Be Long-Term Issue for Travelocity: The ink barely is dry on the Yahoo-Microsoft search partnership in which Yahoo will use Bing technology as the default search engine on Yahoo websites and will lead both companies' sales efforts on CPC advertising. Read more

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Was it overkill when American Airlines filed suit against a former middle manager who took a similar job at Delta? After an adverse opinion, American moved to dismiss its own suit.

Travel Weekly: American moves to dismiss lawsuit against former employee: American filed a court motion to dismiss a lawsuit against a former corporate manager who left the airline to work for Delta in a similar position. Read more

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In fallout from the swine flu mess, Mexico City is offering travelers an unusual perk -– medical coverage.

Los Angeles Times: Mexico City offers travel insurance for tourists: Officials in Mexico City hope to lure skittish tourists with unusual bait: complimentary health insurance. Under a new program, tourists who stay in the city’s hotels are eligible for free coverage for emergency medical care, hospital stays, prescription drugs and ambulance services. Read more

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IATA says the outline for airlines appears "bleak" as cargo loads fell even faster than passenger numbers in June.

Yahoo Finance/Reuters: UPDATE 1-Airlines carry less cargo, fewer people in June-IATA: GENEVA, July 30 (Reuters) - Airlines carried 16.5 percent less cargo and 7.2 percent fewer people in June than the same month a year ago, with no sign yet of the global recession lifting, an industry body said on Thursday. Read more

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Major carrier Continental Airlines, playing catch-up with its low cost carrier rivals, is channeling some new mojo by installing satellite TV in seatbacks.

USA Today: Continental installing live satellite TV on planes: Venturing where only low-cost carriers have gone before, Continental (CAL) has become the first big legacy airline to offer satellite TV, a move that could push its peers to follow suit at a time when competition is the fiercest it's been in years. Read more

Travel InsideOut is a Dennis Schaal Blog daily feature. Get a thorough-going look at the day's travel industry top and tangentially interesting stories. Feel free to comment on them below.

Travel InsideOut is Copyright (c) 2009 by Dennis Schaal. All rights reserved.

Bing-Yahoo Alliance Could Be Long-Term Issue for Travelocity

The ink barely is dry on the Yahoo-Microsoft search partnership in which Yahoo will use Bing technology as the default search engine on Yahoo websites and will lead both companies' sales efforts on CPC advertising.

I have few solid answers at this point, but only questions about what this might mean for Travelocity, which is the air, car and hotel provider for Yahoo Travel.

As you know, when Microsoft launched Bing, it integrated Bing Travel (Farecast), the metasearch and advertising/media business that Microsoft acquired, into the Bing search engine.

A new Yahoo-Microsoft website outlines some of the terms of this new search alliance.

Among the key planks:

• "Microsoft's Bing will be the exclusive algorithmic search and paid search platform for Yahoo! sites. Yahoo! will continue to use its technology and data in other areas of its business such as enhancing display advertising technology.

• Yahoo! will become the exclusive worldwide relationship sales force for both companies' premium search advertisers. Self-serve advertising for both companies will be fulfilled by Microsoft's AdCenter platform, and prices for all search ads will continue to be set by AdCenter's automated auction process.

• Yahoo! will innovate and 'own' the user experience on Yahoo! properties, including the user experience for search, even though it will be powered by Microsoft technology."

This latter element presumably is a key safeguard for Travelocity regarding what might happen to the Yahoo-Travelocity contractual relationship. That is, Yahoo will "own the user experience" on Yahoo sites and undoubtedly maintain its contractual home page link to Yahoo Travel, aka Travelocity.

But, in my opinion, this new Bing-Yahoo alliance greatly buffs up Bing Travel -- and also helps Bing Travel partner Orbitz -- because Bing-Yahoo will get about 30 percent of the U.S. search market compared to Google's roughly 65 percent.

So, six months or so from now, when consumers search for New York to San Francisco flights from the Yahoo home page using Bing search technology, one can only wonder how Yahoo will handle the display.

Will it be branded Yahoo but look like this with a link to Farecast's predictive technology?

Will the search display integrate Yahoo Travel in a way that is absent now?

Today, a New York to San Francisco air search on Yahoo displays Yahoo Travel as the fourth organic search result.

The prominence that Bing Travel gets in Bing search results is absent for Travelocity when consumers use the current Yahoo search box for travel queries.

As a company that specializes in metasearch and facilitated search, Bing Travel may have an edge over Travelocity through the Bing-Yahoo alliance because Travelocity, unless it enters travel search in new ways, focuses most of its efforts on its role as an online travel agency, although it, too, is trying to build its advertising/media business.

However, the Yahoo-Bing alliance may benefit Travelocity, too, in the short term, as advertisers welcome a viable alternative to Google.

As you may recall, there were some people who accused Travelocity of killing FareChase by offering Yahoo a sweeter deal a few months ago and convincing a restructuring Yahoo to drop its own FareChase metasearch offering.

So, I wonder if, a few years from now, we might look back at today's Microsoft-Yahoo alliance as a harbinger of the phasing out of the Travelocity-Yahoo relationship.

Nothing on this front is certain, of course, but I am sure that I am not the only person today who thought about this type of scenario.

Meanwhile, today's Microsoft-Yahoo news means that Google undoubtedly will be dusting off plans for the Brave New World of Google Travel 3.0.

Along with Twitter yesterday introducing a search box of its own on a new Twitter home page, the past couple of days have ample potential for disruption.

Is Orbitz Poised for a Priceline-like Comeback?

I reported yesterday how Barney Harford, the Orbitz CEO six months or so into his tenure, is stirring things up at 500 W. Madison St., Chicago, in trying to come to grips with building the Orbitz hotel business.

I spoke to a handful of analysts about Orbitz's prospects and they agreed that a rebound would take a protracted effort.

The Orbitz situation, in its broad outlines, sort of reminds me of Priceline's struggles when its stock was trading at $1.31 on Dec. 29, 2000. Orbitz Worldwide stock, trending upward, sits at $2.41 before this morning's open, a lowly figure when compared with Priceline's stock at $122.72.

I speculated a few weeks ago, that some sort of Orbitz-Kayak combination could be in the offing because Orbitz, with all of the consumer traffic that it draws, needs to leverage its potential in the advertising/media business.

One of the parties called my idea "ludicrous."

Alas, my ideas have been called worse.

But, there indeed was something to my speculation because Orbitz recently relaunched Trip.com, a facilitated-search vehicle, to take advantage of all those lookers who don't book.

In researching this post about Orbitz, I also learned that there was speculation late last year and early this year that Orbitz separately had talks with Priceline and American Express about merger agreements.

A Priceline combination with Orbitz might have helped Priceline expand into European and Asian markets that it has yet to penetrate.

However, I'm told that an Orbitz consolidation with American Express, which didn't lead to a contract signing, was much closer to fruition than the Orbitz discussions with Priceline.

Amex has yet to distinguish itself in the online travel arena -- far from it, actually. Perhaps its rumored talks with Orbitz were a bid to jump-start that effort.

However, the feeling I'm getting now from speaking with a handful of analysts is that nothing is imminent on the Orbitz consolidation front, including other scenarios such as an Expedia-Orbitz merger, a Travelocity-Orbitz marriage or a Kayak-Orbitz joining of forces, although all of these players undoubtedly have pondered these strategic combinations.

Tom Botts, a partner in Hudson Crossing, says there would be too much conflict in an Orbitz-Kayak merger because Orbitz "has staked out a position as a friend to many," including its relationships with Bing Travel, FareCompare and Kayak, among others.

Botts believes Orbitz will pursue a go-it-alone strategy for now.

Along the same lines, Soleil Securities analyst Jake Fuller believes an Orbitz-Kayak combo is not on the table, noting that Orbitz buying Kayak "wouldn't work."

With the Orbitz balance sheet loaded down with $652 million in debt and a market cap of $200 million, Kayak would need to access hard-to-obtain external capital if it were to ponder an Orbitz acquisition, Fuller said.

It's also unknown, Fuller said, whether the Blackstone Group, which controls Travelport and Orbitz, are in a selling frame of mind.

Another industry veteran, who declined to be identified, suggested that an Orbitz-Kayak merger would be a winner in terms of its potential in travel search and the media business, but some sort of paradigm shift would have to occur to make it financially feasible.

"Something would have to happen," this analyst said, mentioning that perhaps Blackstone would forgive some of Orbitz's debt for the right kind of deal.

Forrester Research travel analyst Henry Harteveldt says he doesn't see Orbitz combining with another online travel company like Priceline, Expedia or Travelocity because of antitrust reasons, but he could envision OTCs picking off parts of Orbitz Worldwide, such as ebookers or HotelClub, if OWW conducted a fire sales of its pieces.

"I think the Orbitz franchise is solid," Harteveldt says. "The challenge for them is to rethink their user experience. The shopping experience hasn't changed much since they launched."

Another analyst, who commented anonymously, said Orbitz must focus on generating enough free cash flow to pay down its debt much quicker than it has been doing.

He doesn't believe Orbitz, under Harford, whom he termed "the smartest guy in the room," will become insolvent, but could face a protracted struggle with its "product not becoming very big."

The up-side, this analyst said, is that Orbitz could rebound, if some of its hotel initiatives take hold, in two to three years.

Several analysts said it was too soon to tell whether Orbitz can make the kind of comeback that Priceline began to pull off some seven or eight years ago.

All were awaiting some hint of Orbitz's prospects from the release of its second quarter financial results Aug. 5, and wanted to assess OWW's results for the rest of 2009 before taking a position on OWW's fate.

Said Botts of Hudson Crossing: "I don't know enough yet to say if it is the phoenix rising."

Monday's Travel InsideOut

Twitter, the social media site with the nebulous business model, apparently is getting set to make good on its pledge to start charging for premium services, including business accounts. In a move widely interpreted as a step in that direction, every Twitter page now has a Business link on the bottom, leading to Twitter 101, a business guide to Twitter. The business guide includes case studies, including the following one tracing the evolution of JetBlue’s use of Twitter.

Twitter: @JetBlue: It's Fun, But Does it Scale?: When JetBlue joined Twitter in the spring of 2007, it was one of the first major brands to do so. Today, the company has nearly a million of followers, and its account is often cited as an example of smart corporate twittering. But the company started out on Twitter with modest goals. It wanted to help customers. Read more

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Getaroom.com’s unpublished hotel discounts over the phone sound like a great idea so I dialed for dollars, so to speak, and put its value proposition to the test.

Dennis Schaal Blog: Getaroom.com's Phone Rates and Manner Fall Flat: I briefly and unscientifically tested the getaroom.com call center experience and wasn't impressed with its unpublished rates over the phone and its customer-service style.

Hotwire offered much steeper discounts for properties with the same star ratings and city areas in two instances, while getaroom.com's phone rate bested Hotwire's opaque rate by a few bucks in a third test. Read more

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With their Star Alliance collaboration given the green light, United and Continental plan to get very cozy in their technology relationship.

Travel Weekly: Continental, United to seek shared technology platform: Continental and United plan to forge a common information technology system as part of their new relationship as Star Alliance partners, Continental CEO Larry Kellner said. Read more

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Yahoo and Microsoft reportedly are moving closer to a search deal, an alliance that could positively impact Bing Travel if the partnership makes Bing a stronger competitor against Google.

Advertising Age: Do You Bing? Yahooers May Soon Search With Microsoft: NEW YORK (AdAge.com) -- Yahoo is close to making Microsoft's Bing its search provider. The deal, which would make Microsoft a more credible competitor to Google, is likely to be announced this week, and seems likely to be based on a revenue share, not on a big fat check upfront, as some at Yahoo had hoped. Read more

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Times are tough for the airline industry. But is it prudent to gouge your customers a bit more during the height of a recession by increasing checked bag fees?

Yahoo Finance/Reuters: AMR raises bag check fees for domestic flights: CHICAGO (Reuters) - AMR Corp (NYSE:AMR - News), parent of American Airlines, said on Friday it would raise by $5 the fee it charges to check a first or second bag on domestic flights. Read more

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Global distribution systems have their developer agreements, enabling third parties to build applications to their systems. But Farelogix, in making its Hawkeye point of sale application available for public download, did something completely different -- it released the application’s source code. Here's an update.

Dennis Schaal Blog: Open Source Experiment in Travel Industry a Modest Success: I was reading about open source Mozilla's challenges now that Google has entered the browser market with Google Chrome, and that reminded me that it was time to get an update about the travel industry's own open-source experiment. Read more

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In some quarters, swine flu concerns have subsided, but the problem promises still to be a thorn in the travel industry’s side. Britain recorded “a huge rise” in cases and started screening cruise passengers.

Times Online: Swine flu screening at UK airports amid fear that NHS could be overwhelmed: NHS intensive care services could be overwhelmed by a huge rise in swine flu cases, researchers have warned, as Britain’s port authorities started screening incoming passengers for the first time. Read more

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Travel InsideOut is a Dennis Schaal Blog daily feature. Get a thorough-going look at the day's travel industry top and tangentially interesting stories. Feel free to comment on them below.

Travel InsideOut is Copyright (c) 2009 by Dennis Schaal. All rights reserved.

Brave New World of Google Travel 3.0

With Google’s recent introduction of City Tours and Favorite Places, speculation is rife that Google will 1) enter the travel market, 2) launch an online agency and become another Expedia, or 3) develop or acquire a metasearch engine to compete with Microsoft’s Bing Travel.

Of course, travel and advertising insiders know that Google already is a huge travel industry player, having become a king-maker ever since it debuted Google AdWords in 2000 and acquired Applied Semantics and its AdSense product in 2003.

Jonathan Rosenberg, Google’s senior vice president of product management, spoke publicly last week about how Google intends to make its travel advertising, and advertising in other verticals, more effective.

“I think it is the case on the vertical side that there is a lot of opportunity to get incremental monetization gains where you can further qualify the leads better for the advertisers,” Rosenberg told analysts. “So for example, the finance area and the travel area are areas where there’s a lot of opportunity to do that, so that you end up putting more information in the ad and then incrementally getting more information from the customer so that you can further qualify whether or not the customer in the finance area is interested in a particular type of mortgage, and then you send them to an advertiser with whom they are more likely to consummate a specific transaction that that advertiser is willing to pay for. So there’s a lot of opportunity there.”

But, clearly the early, but too-soon-to-call success of Bing and Bing Travel, may have caught the Googlers in Mountain View a tad off guard.

However, any Google further foray into travel is not just about Bing Travel, the metasearch and fare-prediction engine formerly known as Farecast.

After all, Google quietly unveiled Flight Links, a BookingBuddy-like flight-search engine, in October 2005 and at the time Google officials were adamant that Google would not enter the travel metasearch arena.

The prevailing thinking among Kremlin -- I mean -- Google-watchers at the time was that Google would not expand its presence in the travel industry because it would then be competing with its largest advertisers and that would crimp its AdWords program. Expedia, Marriott and American Airlines would be very angry.

But, as one industry wag reminded me yesterday, that was then and this is now.

The world has changed -- as it has a tendency to do.

Consider that in addition to Microsoft’s integration of Farecast into Bing Travel:

• Orbitz has relaunched Trip.com for air, hotels, cars, packages and cruises, featuring booking engines from Expedia, Hotwire, hotels.com, Priceline, Travelocity, Kayak, fly.com, Holiday Inn, Orbitz, CheapTickets and many more.

• Expedia’s TripAdvisor introduced flight metasearch.

• Travelzoo, which long has published deals and operated SuperSearch, entered the metasearch fray with fly.com. (A comparison of SuperSearch and fly.com is a good illustration of the differences between multi-booking-engine search and classic metasearch.)

• And, travel firms like TripIt, Kayak’s TravelPost, TripAdvisor and FareCompare, with its more than 170 Twitter accounts, are getting their social-media game-faces on.

The days when Google had to be overly concerned that entering the travel sphere in a deeper way would alienate its advertisers are long gone. Just look at Trip.com, BookingBuddy, igoUgo, BingTravel, TripAdvisor -- the list is endless -- to see incestuous travel industry advertisers participating in their competitors’ products and playing click arbitrage.

So, with a huge proportion of vacation planning and booking beginning with Google search, what will Google do next in travel?

I don’t think it will launch an online agency and become another Expedia. After all, the online agency business model is under pressure and that’s why we now call them online travel companies.

They are edging away from over-reliance on the needle-in-a-haystack endeavor of trying to convert hordes of travel lookers into bookers and are ratcheting up their media/advertising businesses. See Trip.com as the most recent effort.

Google could buy a Kayak or another metasearch company to bring Google's travel offering up to speed to compete against Microsoft’s Bing and Bing Travel.

But, with all of that brain power in Google Labs, it might not need to buy anything. After all, Google has operated Flight Links for years, and certainly has the know-how to do something special on its own in travel or travel metasearch.

A third path for Google would be to accelerate the development of its travel apps like Flight Links, City Tours and Favorite Places, monetize the hell out of them and roll them up into something new, as-yet-undefined and very Web 3.0-ish.

Whatever path Google takes to further develop its travel offering, one thing is certain: With apologies to Kayak and Bing Travel, there will be no debate that Google's offering indeed will have its own "look and feel."

Update: Why Bing Travel Went Down

You might consider this a redundant question of sorts, but this is why Bing Travel went down for some 36 hours over the July 4th weekend when a transformer blew out much of the power at the Fisher Plaza facility in Seattle.

In the heat of the crisis over the weekend, much of the detail behind the incident was unavailable, but Bing provided me with some background today.

Bing Travel, known as Farecast before it was rebranded with the launch of Microsoft's Bing search engine, had "redundant counterpoints" for its core networking systems, databases and Web/applications servers, but they all were located within Fisher Plaza, said Bing spokesperson Whitney Burk.

"Microsoft has invested deeply in fortifying the Bing Travel infrastructure to handle high-volume server loads and emergency failure situations, and the amount of redundancy was increased in anticipation of the Bing launch [which took place in the beginning of June]," Burk said.

When the incident occurred last weekend, Microsoft already was in the process of transitioning the "legacy Farecast servers" to Microsoft's cloud computing platform, "the goal of which is to prevent this sort of unforeseen situation from impacting our customers," the spokesperson said.

Citing the complexity of the task, Burk said Microsoft hopes to have Bing Travel moved to cloud computing by the fall.

I will let Burk explain how cloud computing gives computing management systems new, well, "repurpose," and lessens reliance on specific hardware and specialized configurations in disaster-recovery situations.

Says Burk: "Fundamentally, cloud computing platforms offer a layer of hardware abstraction to applications that run on them. This means applications, when retooled to run on the cloud, no longer need to be sensitive or aware of the number of machines available to them running in production. Another distinction of cloud computing technology is that configurations with specialized hardware are avoided. When individual machines fail (which they sometimes do), the cloud computing management systems will automatically detect the failures and repurpose new or existing machines to run the applications.

"Because cloud computing platforms usually consist of thousands or tens of thousands of machines, adding capacity to handle increased load is simply a matter of changing some basic configurations and deploying more copies of the services and applications to additional machines. This also true for geo-redundancy. A new instance of an entire website can be brought online relatively quickly; it’s simply a matter of configuring a set of available machines in the cloud and letting the management software perform the software deployments and traffic routing."

With its data-mining and predictive technology, Bing Travel seemingly indeed runs on a complex system, and it reportedly was the last of the affected websites in Fisher Plaza to begin humming again.

Real estate website Redfin, which had redundancy capabilities at a second location, reportedly was back online in about five hours.

Meanwhile, asked about the business impact of the outage to Bing Travel, Burk declined to comment.

Outage Hit Bing Travel as Integration Slated for Fall Completion

The Geekword blog reportedly has some information from Microsoft on why Bing Travel (the website formerly known as Farecast) was down and unavailable for 36 hours after a fire late Thursday night (Pacific Time) took out the power to Fisher Plaza, which housed Bing Travel's servers.

Although Microsoft acquired Farecast for $115 million in April 2008, the integration is ongoing. Geekword quotes a Microsoft spokesperson as saying that the company is in the process of transitioning Bing Travel to the Microsoft Cloud Computing Platform (presumably in a Microsoft-owned building), and that the process is scheduled to be completed by the fall.

A bunch of other websites were taken down by the transformer failure, but Bing Travel was said to be among the slowest to come back online. The Microsoft spokesperson attributed the delay to the complexity and scale of the Bing Travel system.

Hey, all of that database mining for fare predictions doesn't come easy.

During the outage, a notice on the Bing Travel website suggested that travelers book their trips on Microsoft partner Orbitz.

Apparently Bing Travel didn't have a redundant system in a different facility, And, TechFlash reported that Redfin, after going through a similar drama at Fisher Plaza a year earlier, did. Redfin apparently was up and running Friday morning, some five hours after the power outage.

Shouldn't it just be standard for websites to co-locate redundant systems in separate facilities? Or is that just too costly?

It would seem to be a no-brainer, but perhaps cost-prohibitive.

Given Bing Travel's protracted outage over the weekend, other travel companies should be examining their disaster-recovery plans anew first thing on Monday morning.

Update: Bing Travel Appears to Be Up and Running

I was able to access Bing Travel today, July 4, around 2:30 p.m. EST.

There's still no word on why a power outage in one facility took the travel site down for a day and a half.

I guess Bing Travel loyalists can resume using its flight search tools and won't look, as previously advised, to travel partner Orbitz first.

The travel link to Bing Travel on the Bing home page also has been restored.

Hopefully, Bing Travel will stay up, with the problem resolved.

Happy 4th everyone. Could someone pass me a beer?

Bing Travel Outage a Real Downer

As of this writing, Bing Travel (a.k.a. Farecast) has been down for almost a day-and-a half.

Various news reports, including this one, indicate a fire in a downtown Seattle data center, probably caused by a blown transformer, took down Bing Travel and a host of other nontravel websites.

A photo depicts an unidentified person from one of the impacted websites hauling a server out the door of Fisher Plaza, the site of the fire.

A notice on Bing.com/travel stated:

Sorry, Bing Travel is currently unavailable

A fire occurred at Fisher Plaza in downtown Seattle just after midnight on Friday morning, July 3. A blown transformer knocked out power to the entire building, which is home to the Bing Travel servers. This is isolated to Bing Travel only, and there has been no impact to any other aspects of Bing. We're hard at work to restore service following this unexpected event and appreciate your patience.

In the meantime, you may use Microsoft's travel partner, Orbitz, for your travel needs.

The usual travel link on the Bing homepage was removed, but the outage seemingly doesn't impact other services on Microsoft's new search engine (excuse me, "decision engine"), Bing.

The Bing Travel outage, however, does impact Bing's slew of travel industry partners, including technology providers, airlines and hotels, and certainly won't inspire consumer confidence.

However, the reputation hit may be short-lived. After all, there are few customer service issues involved because Bing Travel, as a metasearch site, is not a travel agency and doesn't book any travel.

There's no further detail yet from Bing Travel about what happened and why a back-up system, if there was one, didn't kick in. Bing Travel is a relatively small company, but Microsoft would certainly have the monies and resources to power a solution for such outages.

There will be lessons learned from this fiasco about data center security and redundancy. Many large travel companies, including Amadeus, have back-up data centers. Amadeus's data center is located in Erding, Germany, and a clone of that one is positioned 30 kilometers away.

TechFlash reported that a fire occurred at the same data center in June 2008, and a Redfin official outlined some of the steps the company took to avoid what author James Baldwin might have characterized as "The Fire Next Time."

Especially since 9/11, data center security is paramount.

Meanwhile, it was interesting this morning that a Google search for Bing Travel retrieved Bing Travel's outage announcement as the top organic result.

Conversely, a Bing search for Bing Travel produced no word of the Bing Travel unavailability, at least on the first page of results.

And, the second-highest Sponsored Link in a Google search for Bing Travel was from Kayak, which reportedly has accused Microsoft of copying Kayak's look and feel.

The other day there was a Twitter debate about whether some of the underlying technologies that help make Bing Travel and Kayak go dictate the allegedly similar GUI. I'm no expert on that question, but I tend to doubt it.

Both metasearch sites use ITA Software to power the bulk of their air searches so they can largely avoid scraping airline websites.

And, both Bing Travel and Kayak count Orbitz as a key online travel agency partner.

No, for conspiracy theorists out there, I don't think the Bing Travel outage was the result of a foray by a Kayak hit team.

Seriously, Kayak and Bing Travel, while ardent competitors, have a lot of respect for one another and both have great products.

I was just about to write that both Kayak and Bing have great tech teams, too. Well, for Bing Travel this weekend, the jury has to be out on that question.