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The Expedia-Travelocity agreement in particular may also set the stage for a greater focus on branding and brand-building for online travel as opposed to strictly fulfillment. LM: We did not see this specifically, but expected something like it.
That says that there’s a belief that perhaps Travelocity’s brand equity is undervalued by the market and/or consumers and that’s something that Sabre thinks can be addressed relatively quickly.
Quickly, as in fast enough to positively influence an IPO.
Much like a sports team signing a player to avoid him playing for a rival.
The Expedia agreement is also in contrast to Travelocity Business and other global assets, which have been sold outright.
EFT: Did Expedia’s growing mobile portfolio play a big part in this deal?
LM: The complete Expedia technology suite had to play a role.Can any other firm now acquire a stake in Travelocity? Eyefor Travel’s Ritesh Gupta explores this agreement with Lincoln Merrihew, VP, Transportation at the research firm Millward Brown Digital.EFT: How would you describe the Expedia-Travelocity strategic marketing agreement?So in this case, there’s a build it or buy decision on the back-end and Expedia has proven it’s a low-risk choice.What makes this deal interesting is that it is not a sell-off of the US and Canada Travelocity assets.Isn’t it too vague to be called a strategic alliance?LM: Right now I’d call it a business partnership, or ‘power dating’, where Expedia has shifted in this case from rival to vendor.No doubt Expedia did its own due diligence on that.The scale of the Travelocity deal also gives Expedia some ‘industry-standard’-like bragging rights, which could help future similar sales.EFT: Would you say it is a big victory for Expedia as it is now essentially powering more traffic with the same technology?LM: Certainly any sale to a formal rival can be considered a technological, business and pride-inducing victory.