Old school will buy start-ups

Katie Fehrenbacher, a new staff reporter at GigaOM, wrote an interesting post on online travel recently titled: Online Travel: Out With Old, In With Next Web. The general message is that the established online travel players "are seeing slowed growth, largely because of a new found aggressiveness by both airlines and hotels that are getting web-savvy and the next generation of online travel aggregators".

Specifically, the "out with the old" crowd is missing earnings and revising (down) estimates:

"Cendant’s Travelport division, which owns Orbitz and Cheaptickets saw lowered earnings last year, and Expedia, the number one site in the U.S., saw its stock drop dramatically, after the company slowed its growth and missed its earnings predictions."

And the "in with the next web" crowd are providing competition by:

"creating meta-search sites that find fares more quickly and easily than there older cousins" and "... combine social networking, blogging and community-based travel."

Sites mentioned as innovators were: Sidestep, Mobissimo, Kayak, and Farecast.

Here is the additional blurb on Farecast: "Farecast's site predicts how airline tickets will fluctuate, helping the buyer purchase when the ticket is cheapest. The site went out of beta last week, though for now only operates for the Boston and Seattle areas."

Katie's bottomline is that "The old school online travel sites could become the likely buyers of newly funded start-ups, and their fancy services."