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Expedia pulls Choice hotels

October 23, 2009

Expedia said it has stopped selling Choice Hotels properties because the two companies were unable to reach an agreement on a new contract.

Choice has some 5,000 hotels around the world operating under a variety of economy and mid-priced brands, including Comfort Inn, Comfort Suites, Quality, Sleep Inn, Econo Lodge, Rodeway Inn, Clarion and Cambria Suites.

Expedia said Choice’s contract expired more than two years ago but the two had been working under extensions.

"While it is not our policy to discuss the terms of contract negotiations publicly, many of the issues under discussion were principles which both parties had been operating under during the prolonged extension period, and are commonplace throughout the hotel industry," Expedia said in a statement.

"It is very unfortunate that Expedia and Choice were not able to come to an agreement on terms for working together going forward, especially considering the potential adverse effects that this may have on many of Choice’s individual franchisees."

In a statement, Choice said negotiations broke down after Expedia "looked to dramatically alter their agreement, asking for full control of our franchisees’ room inventory and pricing, including last-room availability."

"This would, in effect, no longer make Expedia a supplier but rather a revenue manager, which would not be in the best interest of our franchisees," the company said.

Choice said it was willing to resume negotiations with Expedia.

In the meantime, Choice said it is ramping up advertising and marketing campaigns, including emails to Choice Privileges members. It is also launching an advance-purchase rate program.

Expedia, meanwhile, has sent Choice franchisees a letter expressing regret about the decision and saying "Choice inaccurately lays the blame" on Expedia.

"We are disappointed that Choice has decided to take what amounted to good faith negotiations … and publicize them in such and inaccurate and misleading manner," the letter goes on to say.

From 1 to 5 of 27 Comment(s)

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#27November 09, 2009
You will get better accomodations booking Choice and better service booking Choice through a travel agent, than price shopping for a room and booking online through Expedia: http://www.victimsofexpedia.com/EN/index.php AND http://expedia.pissedconsumer.com/
#26November 09, 2009
@#23 I fail to see your point. At their root, Expedia is a Software Management company, using multiple GDS's, they are an internet-based travel reservation website, selling other companies' inventory. The only service they provide is a distribution system. Their only interest in managaning revenue is to put more in their own pocket. Therein lies the problem between Expedia and Choice. If I were Choice, I'd tell Expedia the same, your terms are unrealistic especially concerning your desire to control OUR invenotry, replace OUR management. We do not need you, as bad as you need invenotry. Without inventory you are out of business. On the other hand, we have inventory, and our own distribution system, which is augmented by several others. #25 makes a good case in point.
#25November 07, 2009
It doesn't seem to hurt Southwest telling Expedia to get lost!
#24November 04, 2009
GO CHOICE! I am happy that they made this decision.
#23November 03, 2009
expedia equals business of revenue management....... choice hotels equals business of brand segment management.......
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