When they say that mergers beget mergers, they're often right.



We first heard the phrase applied to airlines in the 1980s. They were right then, and they were right in the last decade, when it truly seemed that the merger of Delta and Northwest begat the merger of United and Continental, Southwest and AirTran and American and US Airways.

The history of the cruise industry shows a similar pattern, so it's hardly surprising that the news of the Norwegian-Prestige combination was followed almost immediately by speculation about who could be next.

It didn't take long for armchair analysts to notice that Norwegian's acquisition of Oceania and Regent would leave Royal Caribbean as the only family of cruise lines without a top-tier luxury brand such as Regent or Carnival Corp.'s Seabourn.

The transaction would also leave Silversea and Crystal as the two major independent luxury lines. If more dots are going to be connected, these are some obvious candidates.

But whatever its aftershocks, the marriage of Norwegian and Prestige strikes us as an OK merger and a smart strategic move for Norwegian, which stands to benefit by having a broader product line that extends to the upper reaches of the luxury segment. If it triggers further consolidation, we'll just have to cope with it, as we coped when Carnival snapped up Cunard, Costa and P&O Princess in the span of five years over a decade ago.

What the cruise industry has managed to show, in a way that the airline industry has not, is that diversity and competition can survive consolidation, with just enough new entries from time to time to keep it loose.
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