AllThingsD » airline

Kayak Will Now Compete Directly With Expedia by Launching New Hotel Booking Option

Tricia Duryee — Mon, 14 Mar 2011 12:45:33 +0000

Kayak.com is now giving its customers the option to book a hotel room directly through its Web site.

In doing so, it moves from an independent third-party aggregator to a competitor of the hundreds of travel sites it compares on a regular basis, such as Hotels.com, Hotwire, Priceline and Expedia.

The feature was released today in a limited beta, and will be fully functional in a few weeks, both online and on its iPhone application.

Since Kayak was founded seven years ago, it has been aggregating airline and hotel listings from hundreds of sources to give visitors the best options and price. But it was not known for selling directly to the consumer.

The company, which has filed for an initial public offering, traditionally has earned revenue from sending referral traffic to companies like Expedia and Orbitz. In fact, Expedia accounted for 25 percent of its revenues in the first nine months of 2010, and Orbitz made up 19 percent of its revenues.

In that period, it generated $128 million in revenue and processed more than 469 million user queries for travel information.

Now, the Norwalk, Conn.-based company has decided to go head-to-head with some of its biggest customers.

To do so, the company is partnering with the Travelocity Partner Network, which will be processing the transactions and providing customer service to anyone who books directly on Kayak.

In an interview, Paul English, Kayak’s co-founder and CTO, told us he believes the two businesses can co-exist because they still provide an extremely low-cost lead generator for all of their partners.

While the feature is being rolled out online and on mobile, he said the decision to start booking directly had more to do with the consumer’s experience on the mobile phone.

In a statement, Steve Hafner, Kayak’s CEO and Cofounder, said: “Our users value that we give them choices on where to book, though some people would prefer to complete their purchases without leaving KAYAK…For people who use KAYAK’s mobile app in particular, this will make booking much easier.”

Currently, if a customer is searching for a hotel and wants to book something, they will be kicked out of the app and redirected to another company’s web site in the browser in order to pay for it.

The poor experience causes many people to drop off, and conversion rates are low.

If the transaction can be completed inside the application, a user’s payment options can be stored, and it can be completed in a couple of clicks.

English would not say how much traffic its mobile application is getting, however, as one of the more popular travel apps on the iPhone, it makes up a notable number of its three million daily searches, he said.

So far, its mobile applications have been downloaded more than five million times, and he said there are some users who only search Kayak from the phone.

Government May Sue Google to Block ITA Deal

Arik Hesseldahl — Thu, 13 Jan 2011 20:00:21 +0000

Regulators at the U.S. Department of Justice are mulling a lawsuit against search giant Google over its proposed $700 million acquisition of ITA Software, the company behind many airline ticket and booking sites.

Bloomberg reported today that agency staffers are preparing documents for use in a possible case against Google, but a decision on whether or not to bring a case hasn’t been made. Google–clearly eager to get the deal closed, as it has been six months since it first moved to acquire ITA in July–invoked a federal law that gives the government 30 days to rule thumbs up or thumbs down.

Since then numerous companies, as varied as Microsoft, Expedia and Travelocity, have opposed the deal and formed a coalition called Fairsearch.org to air concerns that Google could stop other companies that depend on ITA’s technology from using it, though Google has said it will continue to offer licenses after the deal closes. Orbitz Worldwide ~~supports~~ is neutral on the deal.

Shopkick Checks In With Target–CEO Cyriac Roeding Talks About Social Shopping

Kara Swisher — Tue, 16 Nov 2010 18:28:13 +0000

The idea of being rewarded for being a consumer is getting a lot of heat of late, as retailers seek to take advantage of the fast-moving social phenom among consumers, especially young ones.

Thus, a wide range of efforts to combine location-based mobile apps with purchasing, both online and offline.

Earlier this week, BoomTown posted on a funding for one such start-up, Topguest, which links check-ins with airline and hotel loyalty programs.

Today, another company in the space, shopkick, announced it had added another store–Minneapolis-based Target–to its list of retailers deploying its platform and mobile app.

As with customers of Macy’s, Best Buy and others, users of the shopkick app will receive points and other rewards, as well as instant mobile coupons, just for walking in the store.

The point being: Retailers need to reward foot traffic and not just purchases.

The Target partnership is limited now to 242 stores in the Chicago, Dallas, Los Angeles, Miami, Minneapolis, New York City and the San Francisco area.

Target will also offer scannable mobile coupons to customers for redemption at checkout.

It will be interesting to see how effective apps such as shopkick are as they roll out, as consumers test them.

Unlike others that offer quick deals–from Foursquare to Facebook to, now, Yahoo–shopkick uses its “kickbucks” as an enticement simply for being present in a store or scanning certain barcodes.

It’s certainly easy enough–my son, Louie, did it with ease and definite enjoyment–although a user does need to remember to fire up the app when entering a participating store.

There is also a small device retailers need to install need to make the shopkick ecosystem work.

CEO Cyriac Roeding, a former EVP for CBS’ mobile unit, created the concept for the Menlo Park, Calif.-based start-up while an entrepreneur-in-residence at Kleiner Perkins.

The company has raised $20 million in venture funding from Kleiner’s iFund, longtime Silicon Valley investor Reid Hoffman, as well as Hoffman’s home at Greylock Partners.

Here is a video interview I did with Roeding about where shopkick is going next:

[ See post to watch video ]

Meet the Yahoo Board: Something Old, Something New–But Will They Do Something?

Kara Swisher — Thu, 14 Oct 2010 16:00:49 +0000

With all the noisy swirl around Yahoo of late–from its executive turmoil to its flat growth to its dashed partnerships in Asia to its brash CEO–its board has been unusually quiet of late.

Comatose, some might say.

In fact, many do say exactly that, pointing to the trauma of their disastrous performance when they fended off a hostile takeover attempt by Microsoft (MSFT) for above $30 a share as the cause.

Since then, the stock price of Yahoo (YHOO) has been mired in the low teens.

That is, until yesterday, when even more rumors of new plots emerged in the media, with private equity firms, media companies, Web rivals, big shareholders, Wall Street and others all machinating about trying to grab all or some of the Internet giant.

Now, it will be interesting to see if its directors will shake themselves out of their typical comfort zone of inactivity to actually do their job.

Which, as former GE (GE) star exec Jack Welch–in a recent smackdown of a spate of controversial moves by the Hewlett-Packard (HPQ) board–said in a recent interview, is to “pick the CEO, help them shape strategy, make them feel good about themselves, and, if the CEO isn’t doing a good job, to ‘get them the hell out of there.’”

According to sources close to the situation, the Yahoo directors are in a quandary, even as they are on the receiving end of a flood of suggestions and demands from big investors, ranging from merging with AOL (AOL) to aligning with News Corp. (NWS) to selling off the company’s lucrative Asian assets to replacing CEO Carol Bartz.

You get the idea.

But that might not happen as quickly as some want. Sources said that while the eight-person board has some strong personalities on it, there is no one who has emerged as a powerful leader, aside from Bartz.

Yahoo has recently tried to attract two execs who might be able to go toe-to-toe with her–OpenTable (OPEN) CEO Jeff Jordan and Akamai (AKAM) President David Kenny–but was turned down by both.

Neither apparently wanted the headache of dealing with Yahoo’s struggles.

The same goes for some on Yahoo’s board.

Said one person who had spoken to a few board members recently: “Each of them tells me, ‘I’m only one person and I can’t act alone.’”

Indeed not, which is why you have a board. Stone soup, people!

In any case, it is high time to put the spotlight on the Yahoo directors, which I have done in the past in other crisis moments.

Here’s a rundown, with their photos from Yahoo’s shareholder Web site, along with some BoomTown analysis:

Carol Bartz, CEO:

We all know her, the tough-talking longtime Silicon Valley software exec who was brought in to clean up Dodge in the wake of the rocky tenure of former CEO and co-founder Jerry Yang. She is under pressure here for not doing that well enough, of course, despite a very, very big compensation package.

Still, with an aggressive personality and a wimpish board, she might be able to stave off any challenges to her power.

Roy Bostock, Chairman:

The longtime airline board member and advertising exec has been at the top of the Yahoo board since 2008 and on it since 2003.

Which is why I called for his resignation after Yang and former Yahoo President Sue Decker gracefully stepped down, after their management was called into question.

Bostock was right there with them, making all those decisions, which turned out to be disastrous in hindsight. Still, he does not seem to be much for the honorably-falling-on-your-sword thing.

In fact, sources said he has been making the rounds of investors recently trying to gauge the mood. Memo to Roy: It’s bad.

Eric Hippeau

Now the CEO of the Huffington Post, the longtime Web investor and publisher has a lot of online experience and should be one of the leaders on the Yahoo board. Hippeau has certainly been a director long enough to be one–since 1996, as an early investor in the company.

He’s also known as a super-nice guy in Internet circles, which means he is no head-smacker. Too bad.

One idea floated to me by an investor: Yahoo could buy the upstart online media darling and install him as CEO. Pretty please, because the entrance of the fab stylings of Arianna Huffington into this mess would send me into the stratosphere of reporting nirvana.

Vyomesh Joshi

Also a very endearing dude, the top HP exec was one of those on the short list for CEO of the tech giant recently. He runs its gigantically profitable printing and imaging business.

He’s been a Yahoo director since 2005 and should be a key decision maker, since he is an experienced operator. He’s not been, unfortunately.

Arthur Kern

Also a lifer, also having been on the Yahoo board since 1996, the investor and radio exec has also worked in marketing at Digitas.

Among the board members, he seems to be the quietest of the bunch, so I am not sure what to say about him except that he has very white teeth.

Gary Wilson

Another investor–in private equity, he has been on the board of airline companies (what is with this plane stuff on the Yahoo board?), as well as a top financial exec at Disney (DIS) and Marriott (MAR).

Again, a nice résumé, and he should be a leader. He was definitely more involved in the Microsoft situation than others.

Since then? Meh.

Sue James

The accountant. Retired from Ernst & Young. Used to work for Bartz, as lead partner for audit work for Autodesk (ADSK). Joined the Yahoo board early this year.

Probably just figuring out that this whole thing might not be adding up.

Patti Hart

Also new, since June. Worked in the digital video business, and is now the CEO of a “global provider of electronic game equipment and systems products.”

Say what?

Okay, I will go with it, as I am liking that Bartz has brought on two women to the board, which has mostly been stacked full with men.

Brad Smith

The president and CEO of Intuit (INTU), the financial management software powerhouse, also joined in June. This guy should be able to shake the trees, right?

But he is probably still trying to learn everyone’s name. Brad, not to put too much pressure, but everyone is counting on you.

Jerry Yang

Last, but certainly not least, the man who is ultimately the power player here.

The Internet pioneer and industry legend checked out of Yahoo for a bit after he stepped down in early 2009–time to tee off!

But many sources said he has been back at Yahoo for a while–glad-handing advertisers, meeting with entrepreneurs, sussing out trends, piping up in strategy meetings and doing the behind-the-scenes thing that he does so well.

Reports vary on how much he likes Bartz–he expresses support for her to some, but seems to have soured on her to others.

Who knows with the endearingly prickly Yang, whom I have been covering for a dog’s age and who should return my emails once in a while, like in old times when I stalked him.

Dinner is optional, but I will pay this time (see video below of our last semi-enjoyable meal).

Still, here is what I know for sure: Yahoo is Yang’s creation and legacy, and he’s the one who has to make sure that it survives and thrives.

For all the uncertainty surrounding Yahoo once again, that much is true.

[ See post to watch video ]

Web Meme: BoomTown and the Internet Is on #TeamSlater and His Inflatable-Slide Rage

Kara Swisher — Tue, 10 Aug 2010 15:15:56 +0000

The story of JetBlue flight attendant Steven Slater–who, after being abused by a passenger, did a full “Norma Rae” and huffed off the airplane via an inflatable slide–spread like wildfire across the Internet yesterday, almost immediately after the incident occurred.

It’s too much to hope that someone on the JetBlue (JBLU) flight had a Flip camera and is uploading the incident on YouTube right now, but video is unnecessary after the tale of flight rage got out and details piled upon details.

This is just the kind of silly, but true-to-life, story that everyone loves to share, and share it they did, with #teamslater quickly gaining ground on Twitter, and online comments and news stories exploding.

And why not? Everyone has encountered the entitled jerk who gets up before the plane has stopped, grabs his bag from the overhead compartment and then shoves his way to the front. Slater was simply doing his job by asking this passenger to sit down, and then decided he had had it when the bag struck him and he was cursed at.

We’ve also had our share of surly service from airline personnel, but this incident shed light on exactly why they might be a little more tetchy than we expect at times.

Maybe the cursing back on the intercom system and the dramatic beer-drinking exit was a bit over the top, but so what?

Slater is now, for better or worse, a Web hero.

Just like Norma Rae, seen in the video clip from the movie’s big scene below:

(The image is from Slater’s MySpace page here.)

Skype on a Plane? Please Don't.

Peter Kafka — Thu, 11 Mar 2010 21:46:41 +0000

More and more airlines are adding in-flight wireless, which means you can now Twitter from 30,000 feet. Go ahead and tell your friends–over and over and over.

But while it’s technically possible to use that same technology to Skype with your friends or families or whomever, airlines won’t let you do it.

The reason should be self-evident, but not to Federated Media’s John Battelle. Who apparently does this all the time.

Except on a flight this week, when a United Airlines attendant told him that using Skype in flight is a security violation.

That’s not true. But with the help of the Web–and, apparently, State Department employee Katie J. Stanton–Battelle pieces it together: Airlines ban in-flight video chat because it’s incredibly annoying for everyone who’s not chatting.

Or in Federal Aviation Administration-speak, the airlines are “simply responding to the overwhelming majority of their customers, who prefer silent communications to the public nature of Voice-over-Internet-Protocol (VoIP) calls.”

Battelle insists his Skype chats provoke nothing but “amusement” from his seatmates. But my hunch is that it’s only dumb luck that has kept him from getting pummeled by a fellow passenger to date. That United attendant did him a real favor.

Almost Famous: Mehdi Maghsoodnia of BookRenter

Drake Martinet — Fri, 05 Mar 2010 09:35:13 +0000

A feature wherein All Things Digital looks at up-and-coming and innovative start-ups you should know about.

This week: We took a coffee break (and made an interview and video) with Mehdi Maghsoodnia, CEO of BookRenter, a company that claims to be “numero uno” in online textbook rentals, a bone of contention between it and larger competitor Chegg.

Who: Mehdi Maghsoodnia

What: Chief Executive Officer

Why: BookRenter is in a battle with competitor Chegg. Mehdi freely admits that Chegg holds more market share, but says his model has the staying power to outlast it. Presumably, Chegg begs to differ.

Where: bookrenter.com (Web site); @bookrenter (Twitter); Campbell, Calif. (analog place)

Who else: BookRenter is in a battle for the hearts and minds of college students everywhere. On one side, it competes with college bookstores, Amazon (AMZN), and a trial-rental program from Barnes & Noble (BKS). Once a customer goes the way of rental rather than purchase, BookRenter has to fight with Chegg, the textbook service now led by longtime Silicon Valley exec Dan Rosensweig and whose eggshell has been stuffed with $144 million in venture funding.

Five Stats You Won’t Find in His Facebook Profile

Worst Job Ever: I used to sweep the grounds for a hotel in San Francisco, called Roberts at the Beach Motel (it’s still there). It was right next to the zoo, and the wind would blow all the dust, sand and junk into the hotel, and my job was just to sweep the floor. That was not at all fun.

Geek Crush: I’m a fanatic in terms of business models, and I track the careers of people I admire. I keep track of Maynard Webb, who used to be the COO at eBay (EBAY). I track people with clever minds and clever ideas.

Gadget of the Moment: I love my Apple (AAPL) iPhone–for the first time recently I traveled without my laptop. It was great. The app environment is fascinating. If you look on my phone, the apps are in two distinct sections. One is all the games that keep my kids busy, and the second category is functional things for me. News feeders, banking…and I watch all kinds of videos on the TED app when I’m traveling.

International Businessman of Mystery: I was born in Iran. Then, we moved to London. I traveled a lot and lived all over. I realized early on that a consequence of that is I’m culturally very unmarketable. It’s pretty impossible to market to me. Which, by definition, means I’m not the greatest marketer, because I don’t know what makes people want to buy things.

It’s All in the Family: I sit on the board of Nature Air, an airline in Costa Rica. It’s the first regional green airline, and it’s the family business.

Bio in 140 Characters

Mehdi grew up global, but landed in Silicon Valley. He spent time as a VC then moved to head CafePress. Now he’s CEO at BookRenter.

The Five Questions

Let’s get right into this. How are you guys different from Chegg?

When I was at CafePress, we were the biggest online t-shirt retailer in the world. We spent a lot of time getting shirts in from China, organizing them, putting them in bins, tracking them, printing them and so on. I observed how much of our management bandwidth and resources went into back-end fulfillment as a retailer. I came out of CafePress and was sitting on the venture side when I saw Chegg and BookRenter. I said, “These are two teams satisfying specific demands out there, but with totally different business models.”

Chegg was trying to do everything–taking on warehousing, buying the books, etc. There were many companies doing that, by the way. Amazon among them. The BookRenter team was clever, and they said, “Let’s flip this on its head.” Investing in a book as stock is a losing venture, because your individual investment on the book loses value over time. You also lose money on leasing the warehouse, forklifts, all of it.

At BookRenter, we have all kinds of partnerships that handle those logistics, including recent partnerships with school bookstores themselves. We are in a cyclical business, where maybe four months out of the year we are handling books, and, in the other eight, the books are in the students’ hands. Our costs adjust within those cycles as quickly as changes happen.

How do you track and price all the books when you don’t own them?

So, most of the business is done today on an inventory capitalization model. That is to say, you have a position on what books you have. Everyone buys books and then has to find a match for that book in a rental relationship.

BookRenter takes a very different approach. Our software system creates rental relationships in real time, which means it figures out prices and availability for every new rental. If you come to us and say you want to rent a biology book, the system turns around and queries our suppliers and decides who will be able to get us that book at the lowest overall cost. Our cost algorithm is complex and takes into account things like the reliability of the provider for meeting its commitment on that book.

Once the determination has been made, only then do we take a position on that book and add it to inventory. I can offer as many books as [Chegg] or anyone else, because I’m offering that book virtually. I only pay when I have a paying customer.

You’ve got a lot to say about how you are going to gain on Chegg. Is this really a market that is worth the fight?

Oh yes, the market is growing very fast. We saw 300 percent growth year over year in January. The textbook business is a $9-billion-a-year industry. Someday we hope that a third of that is rentals. The value proposition is there. Renting is cheaper than buying. It’s even cheaper than buying used. Eighteen months from now, we are still going to be a smaller player, but we have the longevity.

Do you do this for the competition, or is it something else that drives you?

I’ll be honest. The best possible outcome for us is that Chegg stays prosperous. Both of us are fighting the same battle in terms of converting some of the buying market to a renting market. So, we are all in the same market development boat. But what I really like about this is the process. I see our business as a 0.9 version, so there are so many things we can still work on.

Organizationally and market-wise, it’s a very exciting thing to design a system for. You have to balance the needs of all kinds of partners. It’s like playing multidimensional chess with very good players. It’s just fun. Also, the growth factor is great. If I had to solve these problems in a business that wasn’t growing, that’s not a lot of fun.

I’ve been there man, that’s deadly. You put a lot of intellectual work into it and you can’t get anyone to care.

As a current student, I’ve got to ask: How have you dealt with undoubtedly the biggest customer problem–highlighting?

[Laughs] You know, that was a real issue early on. Our early policy was no highlighting at all, of any kind. It turned out that students didn’t seem to mind [the highlighting], and in fact many liked it. It was like someone had already done the work of showing them the important parts of the book. Today, we will only charge for damage if there’s been a real issue, like, someone spilled water all over the book and really ruined it.

The In Living Color Interview

[ See post to watch video ]

United Might Break Guitars and the Funky Wedding Video Has Buzz, But Will It All Have a Susan Boyle Ending?

Kara Swisher — Thu, 06 Aug 2009 15:30:48 +0000

Oh, who doesn’t just love, love, love the two latest viral videos to hit the Web?

One, called “United Breaks Guitars,” is a very funny music video about an experience singer Dave Carroll had when the airline murdered his guitar and then refused to say sorry.

It has had close to 4.7 million views on YouTube.

The other, even better, is a joyful wedding dance of Minnesotans Jill and Kevin, along with their many grooms and bridesmaids, all of whom hilariously boogeyed down the aisle.

Current count: 17.1 million views.

While that’s all well and good, like a lot of these kinds of viral phenoms, neither is likely to go the distance in economic rewards.

While Google (GOOG), owner of YouTube, has been making noise about the wedding video causing a spike in sales of Chris Brown’s “Forever,” which is the music the wedding party shimmies to, this kind of one-off is not really a sustainable way to make video a true financial windfall.

And herein lies the problem–the Internet is most excellent at surfacing and distributing these delightful videos, but it still is not so good at revealing an organized, massive way they will all pay off.

That’s because much of it relies on buzz, which is simply unguessable.

And, even though more advertising efforts are being aimed at premium content on sites like Hulu, the revenue still remains much smaller than costs.

Consider the Susan Boyle sensation, which can doubtlessly be called 2009′s Web powerhouse. The video of her astonishing rendition of “I Dreamed a Dream” from the musical “Les Miserables” on the television show, “Britain’s Got Talent,” was a huge hit.

So far, the show’s YouTube post alone has 75.2 million views, but–due to a number of reasons–it did not make such sensational amounts of money.

Obviously, as consumers shift more and more time to watching Internet video, advertising allocations will be shifted too.

And, with media moguls like News Corp. (NWS) CEO Rupert Murdoch making copious noise about charging for content, it’s likely the most popular videos might begin to get some lucrative gating at some point.

But for delightful hits like the wedding dance or “United Breaks Guitars,” it will be interesting to see if they ever become more than watercooler wonders.

In any case, please enjoy the videos gratis!

Jill & Kevin:

United Breaks Guitars:

Susan Boyle:

This Is Your Captain Speaking: Will the Gentleman in Seat 21A Please Stop Surfing Porn

John Paczkowski — Fri, 12 Sep 2008 18:33:03 +0000

Now that air-to-ground broadband has added Internet porn to American Airlines’ in-flight entertainment offerings, the company’s flight attendants are asking that it be taken off. The Association of Professional Flight Attendants, which represents 19,000 AA employees, is urging the airline to block access to Web content it feels is family-unfriendly.

“We’ve heard a lot of complaints from flight attendants and passengers,” union spokesman David Roscow told Bloomberg, though he didn’t offer up any actual incidents as proof. Which isn’t all that surprising, really. After all, travelers have been able to bring pornography on flights for as long as there have been commercial airlines. For crying out loud, airport gift shops and newsstands sell porn. But it’s rarely a problem in-flight because … well, who wants to be the creepy porn guy in seat 21A? And if you don’t mind being that guy and your presence troubles other passengers, your airline obviously have ways of managing that. Said American Airlines (AMR) spokesperson Tim Smith:

Our policy is to provide Wi-Fi capabilities the way customers are most familiar using [them] at home, office, coffee shops and on the road–with unfiltered connections that allow customers to get what they need, when they need it. While it does provide a new access point for information and content, customers viewing inappropriate material on-board a flight is not a new scenario for our crews who have always managed this issue with great success.”

Bill and Jerry's Excellent Ad Venture

John Paczkowski — Fri, 12 Sep 2008 18:00:09 +0000

[ See post to watch video ]

Bill and Jerry's Excellent Ad Venture

John Paczkowski — Fri, 12 Sep 2008 18:00:09 +0000

[ See post to watch video ]