HOLLYWOOD, Fla. -- Travel agents who turn away from niche cruise
lines because of the bankruptcies last year of Premier and
Commodore are harming themselves and their clients, according to
Ron Kurtz, former president of Commodore Holdings.
"When there is reduced competition and the public loses choice,
the channels of distribution are at risk," said Kurtz, who was
president and chief marketing officer at Commodore Cruise Line and
Crown Cruise Line, both of which were operated by Commodore
After Commodore filed for Chapter 11 in the last days of
December, following the demise of Premier in September, many agents
said they believed that niche cruise lines with older ships cannot
compete with large lines and their new megaliners.
"When agents talk about the permanent demise of the smaller
carriers, they seem to be showing no appreciation for market and
product segmentation, and that's a danger to the industry at both
the retail and supplier levels," Kurtz said.
"That attitude will discourage innovation and product variation,
which I don't think is good for the consumer."
Pointing to the airline industry, he said: "When you have
consolidation and only a few players, agents get hurt by a
reduction in commissions, and consumers get hurt by a loss of
service. I'd hate to see an extrapolation of those trends to the
Kurtz, who left Commodore Holdings two weeks before its Dec. 28
bankruptcy, argued that Commodore and Premier did not fail because
they were smaller lines and operated older ships.
He contended that both companies failed because they made
expansionary new investments in a worsening economic
"They had a lot of debt compared to equity," he argued, "and
they took on more debt by starting up new ventures, which they
weren't in a position to take."
Admitting that small companies may face special problems, he
added: "I don't say it isn't difficult for small players, but their
objective is to have a product and a market segmentation that big
lines aren't serving adequately."
Kurtz said that Commodore and Crown were operating with
relatively high load factors and attracting satisfied
"We were filling our ships, and, given market conditions, were
getting a pretty good yield."
He continued, "A smaller, older ship that is well maintained can
offer an attractive difference to certain segments of the
Further defending the role of niche lines, he went on: "We
recognize the big numbers [of passengers] are for the big new
ships; that's where the public wants to go.
"But many passengers, including mature travelers, don't
necessarily find that exciting. Many find it intimidating to get
around those ships."
Kurtz, who was president at Sea Goddess Cruises and later a top
executive with Windstar Sail Cruises, was a consultant to Oslo,
Norway-based ResidenSea before joining the Crown and Commodore
He now heads his own consulting firm, Management Resource Group,
in Aventura, Fla.