IHG makes good on Expedia exodus

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NEW YORK -- Enforcing its new standards for Web distribution, InterContinental Hotels Group, as expected, pulled its inventory from Expedia and Hotels.com last week, cutting off 75 owned and managed properties and numerous franchisees from two of the biggest sales outlets on the Web.

InterContinental decided to stop selling merchant rooms on the two sites in August because they didnt agree to adhere to the hotel companys Web standards. InterContinental is making exceptions for some properties that had contracts in place prior to Mays implementation of the Web standards, which cover various technology, trademark, price transparency and consumer issues.

But the company said it will punish franchisees -- including pulling their flags -- if they refuse to comply.

The two Web sites, both units of IAC/InterActiveCorp, are continuing to sell rooms for an unknown number of InterContinentals franchisees. Some have waivers; others may not be complying with the initiative.

One property in the Southwest sold about 5,000 room nights and collected more than $500,000 in revenue through sales on Expedia and Hotels.com last year and is awaiting word on a waiver request to keep working with the two sites.

In the meantime, one official at the hotel said, "Its going to affect us, but were in a good market so we can pick up room nights in other ways.

"Itll take a couple of months and then well recover. I think it will [have a bigger impact] on smaller hotels that dont have group business."

Jim Young, InterContinentals senior vice president of global distribution, said the company has taken steps to assist franchisees. "To offset any immediate revenue loss, we have developed comprehensive, alternative channel-enhancement initiatives to assist properties which may be impacted," he said.

Overall, he said online travel booked through Expedia and Hotels.com amounted to 1% of the companys revenue. Certifying Web distributors is "a long-term investment," he said.

In addition to certifying Travelocity, Site59, Hotwire and Priceline, InterContinental has given the thumbs up to Asia-based Wotif.com and U.K.-headquartered LastMinute.com.

Young said InterContinental is evaluating hundreds of other distributors and is "very comfortable with the pace, as we are negotiating on behalf of more than 3,500 hotels worldwide."

To contact reporter Dennis Schaal, send e-mail to [email protected]

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