A Google spokesperson tells WebProNews, “Consumers benefit from clear labeling in search results, and we have always clearly disclosed which links are paid advertisements. That said, not all search engines clearly disclose paid results, so we would support a fresh look by the FTC at search labeling and transparency practices.”

Though Google’s competitors are often eager to see scrutiny brought to Google, it’s not as clear if some of these same competitors are so eager to see such scrutiny brought to the entire industry.

When asked if they would support such a review from the FTC, Expedia and Orbitz, for example, did not return our request for comment. Microsoft, on the other hand, did return our request for comment, by saying, “No Comment.”

Sullivan had made points about Google not disclosing sponsored results on some of its vertical engines, even if such results came with the “sponsored” label, when appearing on Google’s main search product. For example, one might use Google’s Hotel Finder, but not necessarily know when a result was paid for. Sullivan also made the suggestion that there is an issue regarding device manufacturers who have accepted money from Google to select the search engine as its default, and how they should disclose this to customers.

As he pointed out in his letter to the FTC, there are plenty of similar issues among Google’s competitors.

Marvin Ammori from The Ammori Group wrote about the topic at GigaOm, saying:

I head a small law firm in Washington, D.C., where I advise technology companies, including Google, on public policy issues. As an advocate for open Internet rules, I’ve spent many years working on network neutrality issues, and I also took part in the SOPA and PIPA debates, as one of the opponents of unfocused copyright laws.

While advising Google on the FTC’s antitrust investigation, I have noticed an odd pattern: the companies complaining about Google’s actions all commit the same exact actions they complain about. If Google’s actions harm consumers, then so do its competitors. The competitors complain about some things that are not even a problem (such as using snippets of text in a search result) and other things that would be a problem if Google or any other company engaged in them (including deceiving users by mislabeling ads and search results).

Both Ammori and Sullivan talked about NexTag, who specifically made a point to call out Google in a Wall Street Journal op-ed, indicating that the company doesn’t disclose paid listings itself.

The point is, this is an industry-wide issue, and one that is not unique to Google, despite Google’s dominant market share, which already brings so much scrutiny to the search giant.

Just today, Google confirmed that it has offered a proposal to settle antitrust concerns from the European Commission. While we don’t know the details of the proposal yet, one has to wonder if Google is having to make changes to features that its competitors will continue to enjoy.

But what if those sites aren’t always showing us the best deal? Well, it turns out there’s evidence they aren’t. You may already have heard of the cookie trick: if you visit one of these sites and check hotel prices, then come back later from the same computer, the prices appear to have gone up. Clear your browser’s cookies, however, and they go back to the earlier rate. That, it seems, isn’t the only trick up the travel sites’ sleeves. According to a report today in the Wall Street Journal, Orbitz is deciding which hotels to show you based on what kind of computer you’re using. It seems that somewhere along the line, Orbitz users noticed that Mac users tend to spend more on hotels, so they started showing customers who visit their site from Macs more expensive hotels.

According to Orbitz’s data, Mac users tend to spend an average of $20-30 more per night on hotel rooms than PC users, and were as much as 40% more likely to book a 4-star or higher hotel. Of course, Orbitz officials are quick to point out that this isn’t a scam – they don’t show Mac and PC users the same rooms at different prices, they just show them the more expensive rooms first. They also point out that Mac users can still choose to sort rooms by price. They also said that the changes are still in an early, experimental stage, and that they had not rolled out site-wide yet. They also don’t rely solely on the kind of computer you’re using – location and your history with Orbitz count for a lot, as well.

On the surface, then, this practice seems pretty creepy and annoying. After all, why should Orbitz assume I’m willing to spend more money on a hotel just because I have a Mac? How do they know I’m not a broke college student who got the Mac as a gift? The fact that they still allow the same degree of customization, though, alleviates the creepiness a bit. Nevertheless, this sort of search result tailoring is one more example of online businesses using your browsing data in every way they can.

Orbitz predicts a revenue growth of 4-8% for the fiscal year, while Thomas Reuters only projects a 4% rise. Orbitz banks on Q2 revenue sitting between $205-211 million, in line with the $208 million projected by analysts. Orbitz lost $6.5 million at 6 cents share last quarter, as compared to the Q1, 2011 loss of $10.9 million at 11 cents per share, when analysts had predicted a loss of 8 cents. Across the board, revenue was up by 2.6% to $189.8 million, indicative of the increase in European hotel bookings. Orbitz had predicted a revenue sitting between $187 million and $193 million, and all booking combined grossed $3.14 billion.

Orbitz is a leading worldwide travel company, founded in 1999 through investments from American Airlines, Continental Airlines, Delta Air Lines, Northwest Airlines and United Air Lines, and went online in 2001. In related news, Orbitz has recently launched a new Business Express Booking platform, which allows users to better coordinate their work travel.

“With the launch of Orbitz for Business Express, we are uniquely equipped to support any size organization,”

“Whether it’s a global Fortune 100 firm needing a robust Orbitz for Business solution or a startup that requires a streamlined approach through Orbitz for Business Express, our broad array of managed travel solutions can be tailored to meet every corporate travel need.”

Travel is always a hassle, I don’t care how much you do. There is always a delay, a mixup, someones running behind schedule, the weather changes, so many things can go wrong. It is nice to have a group like Orbitz keeping you connected and informed during the whole process. Did you know that there are over 30 million business travelers in the US? Almost 70% of them don’t utilize any such service for travel accommodations.

Another great feature is access to detailed reports about your travel expenditures and other relevant voyage particulars. This could be a real time saver for those who need to file such reports for company record and reimbursement.

If you do a lot of travel, you should look into Orbitz for Business Express. Travel is hard enough and this new service from Orbitz could make it just a little easier. Take some time and check it out. It might be worth the trouble.

The lawsuit states that while the companies have been collecting these taxes from consumers all along, they have only been paying a portion of the taxes to the state and keeping the rest as profit.  Florida says the practice denies it of millions of dollars every year in tax revenue.

"Consumers are already paying ‘taxes and fees’ when purchasing a Florida hotel room online, yet the online travel companies have been keeping too much of those taxes as profit," said Attorney General McCollum.

"If these taxes are due to the State, the companies should pay them for the benefit of the people of Florida."

For transactions not completed via an online travel company, Florida hotels pay the "transient rentals tax" similar to a sales tax on the rate they charge the consumer for the room. The hotel which receives the consumer’s payment for the hotel room owes the tax and is responsible for paying it to the Florida Department of Revenue.

According to the lawsuit, online travel companies purchase hotel rooms at a lower, wholesale rate they negotiate directly with hotels. The companies than resell the rooms to consumers at a higher retail rate and keep the difference as profit. The online travel companies are the merchant of record in these transactions and are responsible for paying the taxes to the state.

The Attorney General’s lawsuit claims Orbitz and Expedia have admitted they do not pay taxes to the state of Florida based on the amount a consumer is charged for the hotel room. Consumers are unaware that taxes have not been paid to the state on the rate they paid for the room.

Florida is the first state to file this kind of lawsuit, which will help clarify the application of state tax laws to online travel companies.
 

You can read the lawsuit here.

Related Articles:

> Turkey Asks Google For $47 Million In Taxes

> Legalized Online Gambling Would Bring In Billions

> NY Lawmakers Approve Internet Tax

Matt Holliday reported, "Orbitz has launched a new Facebook Connect integration to help anyone making travel plans through the site share their flight and hotel details with friends and family on Facebook."  Which sounds nice enough – like something that users will even appreciate, even.

Holliday then continued, "With the new Connect implementation, Facebook friends are able to see users’ complete travel plans in their News Feed when Orbitz users share those details on Facebook.  By clicking on the feed story, they’ll be taken to the Orbitz site, where they can book a similar trip."

This last bit might represent more of a stretch than the 1-800-Flowers development; the average person will more readily spring for a $40 bouquet than book a flight to Panama.  It’s still an interesting move and a nod to Facebook’s importance, however.

Also, as with the 1-800-Flowers news, it’s possible that this will lead to something of a domino effect in terms of companies embracing Facebook.

Orbitz has introduced "Total Price" hotel search results which now show base rate, taxes & fees per night upfront on the initial search results page.

Barney Harford

The company says it is now the only online travel agency that displays total pricing information up front and that its competitors only show base rates on their initial search results pages. Only later in the booking process do consumers see the total price they pay on other travel sites.

"With the launch of Total Price hotel search results we’re making it dramatically easier for consumers to search for hotels," said Barney Harford, president and CEO of Orbitz Worldwide.

"Until today, there was no convenient way for consumers to compare multiple hotels on a Total Price basis. Consumers had to click through to the details page for each hotel to see how much it would cost to book. With Total Price hotel search results, Orbitz is changing that."

Orbitz hopes its latest move will help create loyalty while attracting new customers.

The company also launched the "Hotel Fee Cut" promotion, which reduces fees on all of its hotel rooms booked by July 15.
 

Orbitz.com replaces the Microsoft founded Expedia in the U.S. and affiliate ebookers.com will serve the MSN UK site.

Orbitz says the deal could attract 3.5 million visitors per month to Orbitz through MSN Travel. Orbitz did not offer data on how many visitors it could bring to its ebookers site.

"Our partnership with MSN will provide additional visibility and traffic to both Orbitz.com and ebookers.com, strengthening growth in both the United States and the United Kingdom," said Steve Barnhart, CEO and president of Orbitz Worldwide.

Microsoft said it choose Orbitz because of the travel site’s features and customer service.

Orbitz and ebookers.com will provide all of MSN Travel’s offerings, including air, hotel, vacation packages, cruise and rental car bookings.

"Orbitz provides an excellent online experience for its customers and has unique customer-focused services," stated John Russell, senior channel manager of MSN Travel at Microsoft Corp.

"Microsoft is committed to delivering innovative features that help our MSN Travel customers make smarter decisions, and the integration of Orbitz’s technology is another step toward fulfilling that commitment."
 

When asked if they would take a less convenient ore more expensive flight in order to have Wi-Fi service, 56 percent of business travelers said it was not a necessity, while 36 percent say they would try to book a flight with Wi-Fi available, but would be content if it were not. Only eight percent said the wireless service is very important, and would take less convenient or more expensive flights to have access.

Cell phone usage on commercial airlines faces obstacles and safety concern from the Federal Aviation Administration (FAA) and Federal Communications Commission (FCC). If never approved, it would not bother most travelers on planes, as 57 percent of business travelers oppose cell phone usage in-flight.

"Technological advances have made business travelers today more productive than ever before," said Dean Sivley, senior vice president, COO and general manager, Orbitz for Business.

"While there are those who use flight time to catch up on work, and Wi-Fi will enhance that ability, there are also many who view it as valuable downtime. If ever endorsed, many travelers feel it would be hard to rest with the person next to them talking on a cell phone."

Eighty-four percent of business travelers said they try to be as quiet as possible when on call, and are annoyed by those who don’t do the same. Only four percent admit they will do whatever they need to while working and traveling, no matter how it affects others.

Fifty-nine percent of business travelers said they would use Wi-Fi for both business and entertainment, while 21 percent said they would use it strictly for business. Twenty percent said they would use Wi-Fi only for entertainment.
 

That is particularly tough for cell phones, which access the mobile web, since small screens do not leave much room for advertising. If you feel that a major slice of mobile Web activity will be via sound technology, then there is an additional challenge. Who wants to wait patiently listening through a sound advertisement until they get to the information they were seeking?

Nevertheless the rewards will be high so it comes down to finding out the best way to make acceptable sound advertisements. Part of that acceptability will come from the desirability of the information being offered. An early contender in the field is 1-800-Flights. According to a NY Daily News item, this Houston, Texas company has developed a service, which will give you specific flight status information. The new service, which officially launched this month, covers 141 domestic and international airlines at all 432 U.S. commercial airports, as well as 173 international airports. Along with flight status, 1-800-Flights provides terminal and gate information.

All you do is call and give the flight number, which is picked up by voice recognition technology. You’ll then hear a short commercial while a computer checks the flight information. “The idea behind 1-800-Flights is to offer U.S. air travelers a simpler, more convenient way to check flight status while offering advertisers a one-to-one opportunity to reach these affluent, educated consumers,” said Sam Stolbun, president of the Houston-based company.

1-800-Flights is the first application of voice-recognition technology to flight information throughout the U.S. market although other Web services, including Orbitz and Google, provide flight information on your computer or as a text message to your cell phone. 1-800-Flights is currently a wholly cell-phone-based service, however clearly it could be easily extended to integrate with Web-based services.

If, as we believe, the sound-based mobile Web will be a major sector, then this type of sound advertising will be a sector to watch.

Related:

How Will Advertising Influence Mobile Web Growth?

That ringing sound is Google on the phone

Comments

Tag: