Booking a hotel online may soon get more expensive, hotels warn

A looming merger between two of the Internet's biggest online booking services, Expedia and Orbitz, will lead to higher prices for consumers and make it harder for small hotels and bed-and-breakfasts to survive, an industry trade group said. The $1.3 billion deal would combine the second- and third-largest online travel agencies in the country, leaving behind a "duopoly" in Expedia and its even bigger rival, Priceline, said the American Hotel and Lodging Association. "With that kind of consolidation, there are two big losers: consumers who will have less choice, and small and independent hotels who will have very little leverage against this behemoth," said Katherine Lugar, president of the AHLA. Competition concerns have been swirling for months around the proposed deal, which must be approved by antitrust regulators at the Department of Justice.

The agency made a second request for information about the deal from Expedia and Orbitz in March; the two companies have said previously that such steps are routine, but did not respond to requests for comment. In July, top lawmakers on a Senate antitrust panel wrote to the Justice Department warning that the deal could end up hurting the industry. Hotel reservations account for some 15 percent of all transactions conducted over the Internet. The $152 billion-a-year industry supports more than 50,000 hotels nationwide, and consumers frequently turn to alternatives such as Hotwire.com, Kayak.com and Travelocity.