New Technology, Old Argument

The argument regarding who benefits the most from AI – suppliers or intermediaries – rages on. However, there is a general sentiment that OTAs still have the upper hand because of their brands, customers, data and deep pockets. And now they can be free of Google. “OTAs no longer have to rely on search engines, but can become one,” said Agoda’s Morgenshtern. No one was more emphatic about this topic than the formidable and provocative Barry Diller. “The search monopoly experience of Google is going to end,” he declared, though Google itself will continue to thrive in other ways.

There’s another camp that thinks suppliers have the upper hand, and three industry titans have bet on that: Sanjay Vakil, CEO and Cofounder, DirectBooker and investors Richard Holden (formerly Google) and Steve Kaufer (founder, Tripadvisor). They believe hotels will triumph in an AI-powered ecosystem because they have access to more detailed property data and OTAs don’t connect to every single property. According to Vakil, the value of AI is that it all “happens in one place,” and in one flow, and that “the best answers come from suppliers” while OTAs are “pretty thin.” Even his former employer Google, he said, didn’t have access to loyalty rates or all the amenity content that hotels offer directly to consumers.

However, hotels’ past attempts at self-aggregation to circumvent OTAs have been challenging.  “Is that [AI] enough to change the power of the aggregators, to change the front door of travel, the top funnel, the gatekeeper, and ultimately the aggregators themselveds?,” challenged interviewer Chris Hemmeter, Managing Partner, Thayer Investment Partners. How suppliers can provide more helpful answers on AI-powered platforms remains to be seen.

While OTAs and TMCs may not be replaced, they will be forced to evolve.  Discussing the impact that “predictive and proactive servicing” will have on travel management companies (TMCs), Steve Singh, Executive Chairman and CEO, Spotnana, said in next few years (could be two, could be five), “you're going to have an agentic travel agent for life as an individual. It'll be an expert on you. It'll be an expert on your family, expert on the company you work for, the TMC that serves you and every city and venue in the world.”

It is this anticipation of personal, digital agents that makes the future of travel so compelling, even if there is a few years’ wait before it all happens. “There is still no single solution,” admits Booking’s Ranson. Most speakers agree that travel is an array of processes, both legacy and AI-first, that remain interconnected in a single universe. And don’t discount the human part, either. “I am going to count on human folk walking around, thinking, talking and relating to each other,” concluded Diller.

Center Stage at The Phocuswright Conference covered an array of other topics, including the Asia market, social search, B2B, loyalty, business travel, payments and hotel tech. With the theme, Game On, it’s clear that everyone is in position, regardless of not knowing how it all plays out.