Travel Weekly's Technology E-letter: Nov. 17, 2004

JUST A SMIDGE: In Worldspan's third-quarter conference call, Rakesh Gangwal -- who wears most of the hats over there, including the chairman, president and CEO titles -- said the company gets "a smidge over the contractual minimum" number of bookings in its contract with Orbitz, which runs through 2011. He said he believes that the contract will run through its "life cycle" even though Cendant, which already has Galileo in the fold, acquired Orbitz. On another front, Gangwal declined to specify -- as did Expedia -- what percentage of bookings Expedia is migrating to Sabre now that Expedia is using both Worldspan and Expedia as GDSs. Gangwal also noted that Worldspan has the vast majority of its Web-fare deals in place, although it is negotiating with Air Canada and low-cost carriers, primarily in Europe. For the third quarter, Worldspan saw net income rise 54.5% to $9.8 million on revenue of $233.8 million, a 1.9% increase over third-quarter 2003. Transactions in North America declined 0.2% to 40.4 million.

AGGREGATING OR AGGRAVATING? The travel-search engine craze got more crazed last week with AOL taking a minority stake in Kayak Software. That follows Yahoo's purchase of FareChase in July. AOL and Kayak plan to launch a travel-search service early next year that will be on "the open Web" -- as opposed to the members-only AOL service. Travelocity will continue to power the AOL Travel Channel, where it is the exclusive air, car and hotel provider, and Yahoo Travel, as well. Although AOL and Yahoo call Travelocity a valued partner, officials at the Sabre online unit may find those words ringing hollow. Travelocity, for instance, recently dropped out of Kayak and FareChase. Terry Jones, the chairman of Kayak and former Travelocity CEO, noted that AOL will be able to promote the travel-search engine to its 23 million AOL subscribers and beyond, and that the comparison-shopping site will have a "look and feel" different from the Kayak beta site. Kayak, he said, will continue to promote www.kayak.com and will pursue deals with other players.

CRYING OUT: Viator, the destination tour provider, plans to introduce this month its Direct Connect Web service for sightseeing, attractions, passes and transfers in partnership with several U.S. and European suppliers and software developers. Web services use various software standards, including extensible markup language (XML), to connect disparate computer platforms over the Internet. Viator proposes that its Web service become the basis for an Open Travel Alliance standard for the industry. "This sector [add-on travel products] has been crying out for some direction on connectivity, and this initiative certainly delivers it," said Tom Blankley, president of ATCO Systems, one of the software companies that collaborated in the Web service. The Viator Web service covers basic availability requests and booking confirmations, automating what is now a manual process, Viator said. The suppliers and developers that created this add-on Web service were Viator, ATCO Systems, Mary Charles & Associates, Evan Evans Tours, American Trans Data, InterRez, TS.com and Historic Tours of America.

DARA IN, ERIK OUT: After just a year in the post, IAC Travel CEO Erik Blachford will leave the company early next year, IAC/InterActiveCorp said. Dara Khosrowshahi, the chief financial officer of IAC, will succeed Blachford. An IAC Travel spokesman said Blachford resigned because he prefers working at companies on an operational level; wants to spend time with his family, including a newborn; and hopes to participate in an iron man competition. Khosrowshahi doesn't have much experience in travel, but helped IAC chairman and CEO Barry Diller patch together USA Networks, as IAC was previously known, and knows how to crunch numbers. He will probably need that skill, given that the company's growth in the hotel sector is slowing as occupancy rises and the chains become more stingy with inventory. Blachford will remain in his post at least through January and will help Khosrowshahi in the transition.

PEGASUS SOLUTIONS renewed its agreement with the DER Group, and part of that entails Pegasus providing hotel inventory to the group's new German Web site at www.derhotel.com. The contract extension runs through 2007.

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