Helloworld Limited has terminated its ‘Strategic Alliance Agreement’ with Orbitz Worldwide – signed in 2013 and envisaged at the time as lasting 10 years.
The current helloworld.com.au site will transition to a new platform on 31 August 2016, a Helloworld company statement said, adding that the decision followed discussions with Orbitz’s new owners, Expedia Inc.
This week, Andrew Burnes, Helloworld chief executive, said that the strategic alliance between Helloworld and Orbitz had not delivered the revenue streams initially envisaged by both parties and had created too much conflict with Helloworld’s branded and associate members.
“While Helloworld.com.au, utilising the Orbitz technology, has been in one sense a success in that it attracted a lot of new online customers to the portal, the financial investment by Helloworld Limited in its development is over AUD 18 million to date and between the ongoing losses of the .com operation and the channel conflict with the online site carrying the same brand as our branded and associate members, we have decided to transition the site to a more agent-aligned portal” Burnes said.
“I said from the outset that, in my opinion, it is our responsibility to drive business in the door of our agency members, onto the phones of our agency members and onto the portals of our agency members including Helloworld.com.au and our members should share in the commercial outcomes of those transactions in the same way.
“I stand by that view and consequently once we transition the site, Helloworld.com.au will continue to provide full transactional functionality for air, land, car hire and other travel products and services, however, from September the site will match the available microsites for our individual agencies and the commissions from bookings made on the site will be allocated to agencies in the same way as if a customer walked in the door, called, or sent an email booking,” Burnes said.
“This operation has been costing about AUD 6 million a year over the last two years plus capital expenditure and these losses will now come to an end as a result of the decision to transition to a new site and end the current agreement.”
The current deal with Ready Rooms will also come to an end on 31 August 2016 and Burnes indicated that Helloworld would enter into a new agreement with Expedia Inc. for access to Expedia’s global hotel content via the Expedia Affiliate Network (EAN).
“Our Ready Rooms trade portal has been going very well. Up until now, content has come from Orbitz and from our internal wholesale businesses however we are in the process of replacing the Orbitz content with Expedia content and bolstering our internal content by adding AOT’s significant content in Australia, New Zealand and the South Pacific and the amount of available rooms on the Ready Rooms site will more than double once these two connections are complete” Burnes said.
Edited by Peter Needham